Oh...

 

P.S. As soon as I saw that you'd replied to the thread, I knew what your comment was going to be.

 

I don't think the chances of that actually happening are all that great.

they make the argument that they have to for cost reasons, but that's after they pay stern 500M and MLB more than that. In order to make that warranted, stern would have to bring in 500M in additional margin. he doesn't come close.

 

I agree that their finances are pretty bleak and they look doomed. I do, however, think that the merger will be allowed. The reasons are mostly because they are both losing money, they are competing with free radio, and HD radio. I am sure that XM/Sirius will argue precedence citing the acquisition of Direct TV on the television front.

 

The satellite tv merger was disallowed for monopoly concerns. There are many parts of the country where people are dependent on satellite tv, and have no alternatives. The end result is there's been virtually nil innovation with either service.

Satellite Radio is a different commodity. There are generally free alternatives throughout the country. In addition, unlike tv, a case can be made for other competitors such as CD's and mp3 players. Preliminary comments from the FCC do not favour the merger. There are also lobbying groups particularly motivated against it such as the National Association of Broadcasters and the religous right who want to censor programming. Please do not flame me over the term religious right. They are an established political movement. I'll also note being devout has nothing to do with the religious right.

I respectfully beg to differ with an above comment about Stern's contract. SIRIUS paid for his contract in less than a year based on the number of new subscribers. Similarly, Martha Stewart's contract was paid by the new subscribers she's attracted. NFL is a bit of a non-issue as they received an equity stake in SIRIUS. The NASCAR situation is too early to tell. Although, I hear surprisingly many people talking about watching races on TV and listening to driver radios on SIRIUS. I would never have guessed NASCAR is so big.

XM took a major loss on the Oprah contract, and O&A have done nothing for their subscriber base. Major League baseball remains the main draw of XM.

I will agree the numbers paid to talent are unbelievable. That doesn't mean they were poor investments. I'll also note neither stock has had what would be considered average performance.

For full disclosure: I have 2 SIRIUS subscriptions and own SIRIUS stock. I'm a big fan of Little Steven's Underground Garage and Alexis and Jennifer.