Friday, February 23, 2007

Merger Talk: BusinessWeek Highlights Competitors, Too

Sirius and XM: Bring this clipping to your congressional hearing, too

MARCH 5, 2007 NEWS & INSIGHTS, BusinessWeek
XM & Sirius: What A Merger Won't Fix

Despite increasingly popular content, there's no guarantee the satellite business model will survive Whether or not Washington lets XM Satellite Radio Inc. and Sirius Satellite Radio merge seems beside the point. Even if they get the nod, there's no guarantee the six-year-old business model will survive. Sure, XM (XMSR ) and Sirius (SIRI ) would wring out plenty of cost savings as one company. But the two have yet to earn a penny of profit. Their combined losses for 2006 are expected to hit $1.7 billion...

... And competition is everywhere. Car salesmen are pushing new iPod jacks. More than 57 million Americans now listen to some form of Web radio each week, says radio-audience tracker Bridge Ratings, compared with 14 million subscribers for XM and Sirius combined. Broadcasters are beginning to offer high definition, or HD, radio. While consumers need to buy a special receiver to get HD, which squeezes more programming into the same frequency, the service is free.Meanwhile, 240 million folks listen to regular radio at least once a week. And who knows what's around the corner? Maybe a form of WiMAX will be capable of streaming Web radio to a speeding car....read more: here

2/23/2007 08:14:00 AM

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