In depth: XM and Sirius merger

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On 19 February 2007, XM Satellite Radio and Sirius Satellite Radio announced a move that will change the face of satellite radio in the United States and Canada: XM and Sirius will be merging, creating a single satellite radio provider.

Wikipedia

Wikipedia has more about this subject:

XM/Sirius merger

This in-depth page will track Wikinews and outside articles to provide you with up to date information about the merger deal. As new actions regarding the merger occur, they can get posted below.

Current Events

2007

Feb 19: Merger Announced

Feb 20: A public conference call between XM and Sirius occurred on Feb 20, 2007 at 8:30AM EST. PDF. Audio Webcast.; The Consumer Coalition for Competition in Satellite Radio, a group of Washington DC law students, issues a press release opposing the merger.

Feb 21: US Representative Bob Goodlatte (R-Va) is calling for a hearing on the merger.

Feb 22

ADWEEK has posted a summary of the issues facing the merger here: Hurdles for XM, Sirius Union

Feb 23

Yahoo News has posted an OP-ED supporting the deal: Sirius and XM together makes sense for listeners

Feb 25

This Retuers article analyzes the merger deal from the perspective of the record labels: "Labels weigh potential fallout of satellite merger"

The Q4 2006 Earnings Call contains some useful information about the merger. Specifically, Hugh Panero states that "XM and Sirius today are continuing to operate as separate businesses and we will do so until the merger is finished." He also stated that "No consumer will have an obsolete radio whether they signed up for service a year ago or sign up today or tomorrow."

Feb 27

Arbitron: Satellite Channels Account For 3.4 Percent of Radio Listening From FMQB. - Part of these figures seem to be in dispute. Specifically, Arbitron claims that the average satellite radio listener listens to 14 hours of terrestrial radio for every 10 hours of satellite raadio. Posts on two XM Radio fan sites dispute these findings: [1][2]. This could this be symptomatic of errors in Arbitron's data-collection, or forum posters could be atypical.

500 Broadcasters Get Front Seat On Legislative Process In D.C. - Terrestrial radio operators are making their concerns known to officials. Rep Greg Walden (R-OR) sided with the broadcasters. Among other things, he talked about removing the ownership caps currently in place. This would allow large conglomerates to buy up even more of the local radio and television stations in one market.

Feb 28

Sirius CEO visits congress: Sirius CEO Mel Karmazin went to Washington DC today to defend the XM/Sirius merger in front of a newly formed Antitrust Task Force, part of the House Judiciary Committe.[3] One note is that Karmazin stressed that he is committed to not raising prices, instead trying to lower them.

March 1

Both XM and Sirius have posted letters on their web sites regarding the merger, specifically about equipment and channels

Read the XM letter

Read the XM FAQ

Read the Sirius Press Release

Read the Sirius FAQ

March 7, 2007: FCC Chairman: Consumer Impact of XM-Sirius Merger Remains Unclear; Second House Subcommittee Hearing Held On Satellite Merger; XM-Sirius merger may cost more: Karmazin
March 20, 2007: XM and Sirius submit FCC transfer request; A second Antitrust hearing was also convened today.
May 31, 2007: The FCC has not yet started the 180 day merger-review clock. Orbitcast sums up the situation succinctly: The longest application-to-clock delay in FCC history. At this point, it's unlikely that a decision will be rendered until 2008, making this even more of a political football: With more primary elections happening at the beginning of 2008, the announcement will likely be made amidst serious Presidential primary campaigning.
June 8, 2007: The FCC started the 180 day merger-review clock. Since this review period takes 6 months, the decision will probably not be rendered until next year. More information is in the FCC Announcement.

More information

For more information on the merger, including background on the merger and on both companies, see the Wikipedia Article.

Frequently asked questions

The same questions keep popping up on forum posts, blog posts, and even news articles over and over again. We will address some of those here, but keep in mind that this section is speculation, and that things could change at any time. However, this is based on the most current information that is available, and as news is presented that conflicts with or supports this information, it will be updated to remain current.

Will I need a new radio?: The answer is "maybe". Conflicting reports have been popping up from different people in Sirius. Both companies have made statements that subscribers' existing receivers will continue to work. However, some people involved with Sirius have said that duplicates will be removed. The problem is that there is only room for so many channels, and if the company wants to bring new content, some channels will have to be removed. Also, there is no cost savings in running all of the existing channels. Most of the music stations on each network have a parallel station on the other network. Also, the duplicate simulcast stations (CNN and Fox, for example) can be cut from one network. Without having exact figures, it's likely that Sirius and XM together could cut 1/3 or more of their channels without losing content. Under this scenario, it's possible that one set of radios would lose an entire genre of music, such as XM losing its Urban category and Sirius losing its rock category.

Will the universal receiver fix this?: Yes. It can receive and decode signals from both satellites. However, it is not being produced yet, and probably won't until the merger is either complete or is a "sure thing."

Will XM listeners get Stern? Will Sirius listeners get Oprah?: The most popular shows will probably be simulcast to both networks, but there is not enough bandwidth to completely duplicate all of the shows on both networks. So Howard Stern and Oprah, for example, will probably make their way to the other network. This will almost certainly happen at the expense of other programming. What will suffer is anybody's guess.

What about price?: Karmazin and others have said again and again that they do not want to raise prices. But the exact interpretation of their statements is vague. Probably, you will get the same channels you get now for your $12.95 a month, and to get more content (such as Stern for XM listeners), you will need to pay a little bit more. How much more? Nobody knows.

What about signal issues?: Signals from the XM satellites will work just like they do now, and the same goes for Sirius signals. Things would only change if some channels are moved to the other network (or cut in favor of a similar channel on the other network).

What about Clear Channel programming?: Clear Channel Communications has an agreement with XM and is a shareholder in the company. It is likely that Clear Channel will end its relationship with XM in 2008. For more information, see XM Satellite Radio on Wikipedia.

Will the audio quality get better? worse?: Nobody knows. Hopefully, part of the process of duplicating channels will be that some bandwidth is freed up and will improve the overall audio quality of both services, but it's just as likely that the bandwidth will get used for something else, and that neither service will improve.

Should I wait before buying a radio?: By all accounts, no major changes will occur until 2008 or later, and the universal tuner probably wouldn't be available until even later. So if you choose to wait, you will be waiting for more than a year.

Sources

Mark Hefflinger. "Congressman Seeks Hearing on Proposed XM-Sirius Merger" — Digital Media Wire, February 21, 2007
C3sr. "Consumer Group Ready to Oppose Satellite Radio Merger" — C3SR, February 20, 2007