Tick-tock.
It’s been two months since the U.S. Department of Justice approved the merger of the two U.S. satellite radio companies, XM and Sirius. That was supposed to be the hard part. It was thought that the FCC approval was soon to follow. It was a mere formality. As I’ve written about here and here – the merger of the two satellite radio companies was the right thing to do and in the best interest of the consumers. So I have to ask, what’s the deal?
Actually, that was a rhetorical question. I know the deal. And now that I think about it, deal is exactly the right word, because at this point it’s all about making deals. Deals to get this and get that. Deals to protect special interests. Deals to take advantage of the fact that various groups know the FCC wants to approve this deal and will go out of their way to appease them so there won’t be as much outcry when they do issue approval. So these groups have to strike while the iron is hot. They can overreach in their ask, and know that they will get something. A number of different U.S. Senators and Congressmen have written to the head of the FCC presumably because they’re looking out for what’s best for consumers. Yeah, sure. It wouldn’t have anything to do with looking out for the best interests of the NAB, would it? Nah. The most recent letter came from a couple of Senators two days ago. In the letter they laid out certain conditions for the merger that would ‘protect the consumer by ensuring competition and fairness in the marketplace.’ Really? The conditions they laid out include giving up half of the spectrum the combined entity will have. Please.
Anyway, the point of this post is not to talk about that silliness. The point is that it’s been two months since the DOJ approved the merger and 15 months since it was first proposed by the two companies. That’s a long time. Too long.
What you’re seeing because of this delay is actually what you’re not seeing. You’re not seeing very much advertising for either company. They have disappeared from television completely. Actually I can’t recall the last time I saw an advertisement of any kind from either company.
The reason the two companies proposed to join forces in the first place was so that together they could better combat increased competition. But due to the uncertainty surrounding their partnership, they both have withdrawn somewhat from doing advertising. And that has led to a decrease in awareness of satellite radio in the general marketplace. All the services or technologies that XM and Sirius have articulated as providing this competition are all gaining ground. They haven’t stopped advertising or generating awareness in the marketplace.
Every day that goes by in which the merger isn’t approved is another day that a consumer isn’t hearing about satellite radio. It’s another day they hear about or use another service or technology without thinking about satellite radio.
And yes, of course, it still comes down to content. So theoretically if satellite radio has the ‘best’ and most compelling content they will be able to make up for this lost time and lack of market awareness and will be very successful. The broad range and compelling nature of the content will be able to win the day. However, if satellite radio drops off people’s radar and they develop or further strengthen other habits and don’t even give satellite radio the time of day to sample it, they will never know how good the content is and what they’re missing. Not saying it’s likely, but it’s possible.
Tagged: Merger, Satellite Radio, Sirius, XM