2008 Woodie Awards
Radio exec gets Sirius about XM
David Hinckley / MCT
Issue date: 12/4/06 Section: Entertainment
- Page 1 of 1
David Hinckley
New York Daily News (MCT)
As XM and Sirius Satellite Radio gingerly monitor their busiest selling season, Sirius CEO Mel Karmazin has again raised the possibility the two companies could merge.
While this would obviously have considerable impact on millions of present and future subscribers, there is no indication from either company that a merger is imminent or even inevitable.
"Right now, I think it is one of those what-if questions people in the business kick around," said Tom Taylor, editor of the trade magazine Inside Radio.
XM spokesman Chance Patterson said, "We do not comment on rumors and speculation, and this is clearly just that."
Karmazin has talked about a possible merger before, noting it could eliminate a great many of the duplicate operating costs, not to mention, skeptics say, a large amount of programming choice.
Specifically, Karmazin told Smart Money magazine that "mergers often lead to creating shareholder value" and he has "always been open to that."
He also said he would be less concerned now about regulatory approval for a merger, which has been cited as a major hurdle in the past. He did not specify what might be different now for the company.
Neither company has yet shown a profitable quarter after investing billions in startup costs and hundreds of millions for programming, notably the 500 million dollars Sirius is spending on the Howard Stern show.
Stern sparked a surge in Sirius sales this year, and the company predicts that it will end the year with 6.3 million subscribers. XM is projecting 7.7 million.
But Bank of America analyst Jonathan Jacoby recently said fourth-quarter retail sales are looking relatively soft, which could produce merger pressure from stockholders who have already seen the value of each company's shares decline this year.
If the services did merge, it could put rivals like Stern and Opie and Anthony on the same platform. It could also theoretically offer, for instance, all four major sports plus NASCAR.
But it would shrink music choices, since it would presumably not carry duplicate channels. Since XM and Sirius radios have different approaches in areas like oldies and popular standards, this could wipe out the sounds that widly enticed some people to subscribe in the first place.
New York Daily News (MCT)
As XM and Sirius Satellite Radio gingerly monitor their busiest selling season, Sirius CEO Mel Karmazin has again raised the possibility the two companies could merge.
While this would obviously have considerable impact on millions of present and future subscribers, there is no indication from either company that a merger is imminent or even inevitable.
"Right now, I think it is one of those what-if questions people in the business kick around," said Tom Taylor, editor of the trade magazine Inside Radio.
XM spokesman Chance Patterson said, "We do not comment on rumors and speculation, and this is clearly just that."
Karmazin has talked about a possible merger before, noting it could eliminate a great many of the duplicate operating costs, not to mention, skeptics say, a large amount of programming choice.
Specifically, Karmazin told Smart Money magazine that "mergers often lead to creating shareholder value" and he has "always been open to that."
He also said he would be less concerned now about regulatory approval for a merger, which has been cited as a major hurdle in the past. He did not specify what might be different now for the company.
Neither company has yet shown a profitable quarter after investing billions in startup costs and hundreds of millions for programming, notably the 500 million dollars Sirius is spending on the Howard Stern show.
Stern sparked a surge in Sirius sales this year, and the company predicts that it will end the year with 6.3 million subscribers. XM is projecting 7.7 million.
But Bank of America analyst Jonathan Jacoby recently said fourth-quarter retail sales are looking relatively soft, which could produce merger pressure from stockholders who have already seen the value of each company's shares decline this year.
If the services did merge, it could put rivals like Stern and Opie and Anthony on the same platform. It could also theoretically offer, for instance, all four major sports plus NASCAR.
But it would shrink music choices, since it would presumably not carry duplicate channels. Since XM and Sirius radios have different approaches in areas like oldies and popular standards, this could wipe out the sounds that widly enticed some people to subscribe in the first place.
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