XM, Sirius announce merger

Discussion in 'Current Events' started by Electro Funk, Feb 19, 2007.

  1. Electro Funk macrumors 65816

    Electro Funk

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    :eek:

    http://money.cnn.com/2007/02/19/news/companies/xm_sirius/index.htm?postversion=2007021914

    NEW YORK (CNNMoney.com) -- Rivals XM Satellite Radio Holdings Inc. and Sirius Satellite Radio announced Monday they would enter into a merger of equals, creating a satellite radio giant.

    XM (Charts) and Sirius (Charts) said they would each own half of the combined company, which would have a market value of roughly $13 billion, including approximately $1.6 billion in net debt.


    Shock jock Howard Stern has been widely credited for much of Sirius's success, helping the satellite radio operator finish 2006 with more than 6 million subscribers.

    As part of the deal, XM Chairman Gary Parsons would remain chairman of the combined firm, while Sirius' Mel Karmazin would assume the role of CEO. XM chief executive Hugh Panero will remain as CEO until the merger is completed.

    The two companies, which have a combined 14 million subscribers, said they had not yet determined a new name for the combined company or where its headquarters would be located.

    XM shareholders would get 4.6 shares of Sirius stock for each share of XM they own.

    "This combination is the next logical step in the evolution of audio entertainment," Mel Karmazin, CEO of SIRIUS Satellite Radio said in a statement.

    The deal would also provide listeners a substantially wider variety of programming. Sirius is currently home to shock jock Howard Stern, while XM boasts a number of shows hosted by high-profile entertainers such as Bob Dylan.

    "The combined company will be better positioned to compete effectively with the continually expanding array of entertainment alternatives that consumers have embraced since the Federal Communications Commission (FCC) first granted our satellite radio licenses a decade ago," Parsons and Panero said in a joint statement.
     
  2. EricNau Moderator emeritus

    EricNau

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    I didn't see that coming. Ever.


    Well, I always wondered which was better... Problem solved.
     
  3. yg17 macrumors G5

    yg17

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    As a Sirius subscriber, I don't mind. This will hopefully get me more programming options, I'm all for it.
     
  4. dllavaneras macrumors 68000

    dllavaneras

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    There's a shocker :eek: I wonder if this means satellite radio is coming to the iPod eventually, seeing that there's only one company to work with and less problems to overcome.
     
  5. Electro Funk thread starter macrumors 65816

    Electro Funk

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    Mel Karmazin kind of hinted at it in the last few interviews that i heard... but i still never thought it would happen...
     
  6. zelmo macrumors 603

    zelmo

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    Engadget floated this rumor a couple of months ago. I thought it was sketchy at the time, but apparently not.

    I don't much care, though. I keep my iPod plugged in at all times. Never listen to radio unless I need travel alerts.
     
  7. MacNut macrumors Core

    MacNut

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    This is good news but hasn't the FCC said they don't want one company.
     
  8. Steve1496 macrumors 6502a

    Steve1496

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    I've been waiting for this! Lets hope the FCC will allow it, so users can get more choice, better hardware and not have to pick between two companies.
     
  9. EricNau Moderator emeritus

    EricNau

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    Yes:
    "A clause in the Federal Communications Commission ruling that gave the satellite radio operators a license said one company cannot own the other one."
     
  10. Electro Funk thread starter macrumors 65816

    Electro Funk

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    Rivals XM Satellite Radio Holdings Inc. and Sirius Satellite Radio announced Monday they would enter into a merger of equals...

    do i smell loophole?

    Besides getting shareholder approval, XM and Sirius will also have to get the endorsement of regulators, including the FCC.

    Bank added that as a condition of the merger the Department of Justice might impose some sort of price caps so that the combined company can't raise monthly subscription rates by a big amount, if at all.
     
  11. MacNut macrumors Core

    MacNut

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    So if they both equally own it they get around the loop hole.
     
  12. RBMaraman macrumors 65816

    RBMaraman

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    As am XM subscriber, I don't mind this either. I'm looking forward to new channels, programs, and content.
     
  13. Peace macrumors P6

    Peace

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    AS long as the CEO of Sirius does indeed become the CEO of ***** I think it's great!
     
  14. Aeolius macrumors 6502a

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    Ack! I stayed with XM, to keep Howard Stern off my dial! ;)

    I never listed to FM, anymore... XM gives me an 80s station and some new age... that's all I need. ;)
     
  15. MacNut macrumors Core

    MacNut

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    So is this gonna mean all new radios or what? If I buy now will I have to re buy after the merger.
     
  16. Electro Funk thread starter macrumors 65816

    Electro Funk

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    i dropped XM and picked up Sirius to keep HS on my dial ;) ... although i would love to have the best of both worlds... my navi has xm integrated into the touch screen (song info, channel, ...etc) which i lost when i went with an aftermarket sirius unit... i would love to have it back!
     
  17. GoCubsGo macrumors Nehalem

    GoCubsGo

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    I am happy. This means I can turn the XM on in my truck. I like Sirius programming better than XM so now problem solved hopefully sooner than later.
     
  18. RandomDeadHead macrumors 6502

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    Well now with no compitition in the sat radio arena, they can charge whatever they please without the worry of being undercut on price. Good deal for them bad for the people who like sat radio.
     
  19. Electro Funk thread starter macrumors 65816

    Electro Funk

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    The FCC wont allow that to happen...

    Besides getting shareholder approval, XM and Sirius will also have to get the endorsement of regulators, including the FCC.

    Bank added that as a condition of the merger the Department of Justice might impose some sort of price caps so that the combined company can't raise monthly subscription rates by a big amount, if at all.

    if they dont impose some sort of price cap i doubt they will even let the merger happen...
     
  20. EricNau Moderator emeritus

    EricNau

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    But satellite Radio isn't a necessity - it can easily be replaced with regular AM & FM or even alternative forms of music like CDs or iPods.

    If they raise their prices people will cancel.
     
  21. yg17 macrumors G5

    yg17

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    If this even passes, which, right now I think is a huge if, the FCC will have restrictions on pricing and all that.

    Besides, it would be in their best interests to keep prices low and get more subscribers. They'll make more money having 1000 subscribers at $13 a month than they would having 500 subscribers at $20 a month.


    And whether or not it actually is a monopoly is arguable. You have AM and FM (but who would want that?), CDs, iPods, HD Radio, etc. You gotta think outside the box for competition. Another company doesn't need to use satellites to beam music to cars to be competition for Sirius and XM.

    Just like 20 years ago, this ATT/SBC merger would have never passed. They would have been the only company to give you phone service. But now, it's more acceptable, because while there may not be any competition on that particular medium (POTS), we have a ton of cellular and VoIP companies to choose from.
     
  22. MacNut macrumors Core

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    They want to gain customers so they will keep prices reasonable for at least a few years. Once they get a strong enough base then I might see them raise prices.
     
  23. Spock macrumors 68000

    Spock

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    I dont understand how this is going to happen, I remember when Dish network and Direct TV were going to merge and the FCC stopped them. Is this not the same thing??
     
  24. todd2000 macrumors 68000

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    As long as it doesn't increase subscription rates Im all for it. I have had Sirius for 3+ years and love it. I wonder what the merger would do? Possibly twice as many channels? We shall see what the FCC has to say about this.
     
  25. CEAbiscuit macrumors 6502a

    CEAbiscuit

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    Less choice is always bad. I 'm going to hate to say goodby to my commercial free music on Sirius. I guess this needed to happen for both to survive, but anyone who things that they aren't going to raise rates is fooling themselves. This will go through on the FCC side, as both of this companies can show so much "hardship" that you have to know they planned this battle way ahad of time.
     

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