Thursday, February 22, 2007

XM/Sirius merger will happen, probably, eventually...



Hopefully an XM/Sirius merger will make the 2 weak companies strong enough to turn a profit. In 2005 XM lost $863 million and Sirius lost $667 million. Since 2001 both companies have accumulated more subscribers, with 7.6 million for XM and 6 million for Sirius at the end of 2006. So the 2 combined would have 13.6 million listeners, and enemies Howard Stern and Opie and Anthony would work for the same employer. At $13 per month per subscriber, that is $169 million coming in per month. Hopefully the consolidation of facilities will work to their advantage, but there are many hurdles to overcome. XM is currently based out of Washington DC and Sirius has a home base of New York. They would need to produce a new receiver that could pick up all programming from the new combined service. The merger would give the new company a monopoly on the satellite radio market. Having no competition would be a bad thing in my mind, since they could raise subscription costs and they have no adversary to drive them to be better and attract the best programming. We have seen how a monopoly in the cable TV industry or the phone industry can detrimental. If there is no alternative, customer service is often poor. I think we will see more and more commercials on satellite radio unless they can attract more subscribers. The money has to come from somewhere. I would love to see the union be successful since I enjoy my XM and am also a shareholder. Regulatory agencies need to approve the merger still, but a timeline of when we will hear both services on one receiver is still unknown.

A favorite group of mine, Van Halen, was supposed to reunite with David Lee Roth and tour this summer. But as of this writing I have heard that the tour has been postponed. The lineup was to include Eddie Van Halen's son Wolfgang on bass in place of Michael Anthony. Anthony has been with the group since the beginning in the 70s, but he (and Roth), must have done something to upset Eddie and Alex Van Halen. David Lee Roth has worked as a New York paramedic and had a failed radio career, and was replaced by Opie and Anthony. Believe it or not he also did a bluegrass CD last year which had versions of Van Halen songs.

CBS started out the February sweeps period strong with the Super Bowl, which was viewed by a staggering 93.2 million viewers. American Idol is still strong for Fox, drawing 33.7 million viewers on Tuesday and 31.8 million viewers for Super Bowl week. Fox has other hits with House, 24, and Bones pulling in good numbers. CBS has done well with CSI, NCIS, Numbers, Criminal Minds, Shark, and 2 and 1/2 Men. Hits for NBC include Deal or No Deal, Heroes and ER. Grey's Anatomy and Ugly Betty are winners for ABC. The Grammys were watched by 20.1 million people on CBS, finishing 6th for that week.

*Some material from Entertainment Weekly and Associated Press.
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