Calling Mr. Rehr.....Calling Mr. Rehr

February 28, 2007

In doing a bit of research I came across some interesting perspectives from the NAB as it relates to ownership of radio stations, competition, and serving consumers:

Below is the Executive Summary of NAB's ownership filing. (SSG Comments In Blue)

The National Association of Broadcasters (“NAB”) hereby submits its comments responding to the Further Notice of Proposed Rulemaking in MB Docket 06-121, addressing the Commission's broadcast ownership rules. As all parties to the many ownership proceedings conducted at the Commission have recognized, broadcasting is an important part of our American culture. Local broadcasters provide national and local news, information and entertainment to the American public free of charge. Broadcasters participate in their local communities – they understand the needs of their audiences and work every day to provide programming to address those needs. As our record demonstrates, broadcasters recognize and embrace their obligation to serve the public interest. In light of this important role, NAB urges the Commission to approach its review of the broadcast ownership regulations with an eye toward maintaining the vibrancy of the broadcast industry so that it can continue to provide the vital service that all Americans have come to expect.

So Mr. Rehr......Would I be correct in my understanding that you feel that ownership should be viewed with an eye towards ensuring that vital services can be delivered to Americans, and if in doing so, that ownership is bettered by a change in ownership regulations?

As an initial matter, NAB emphasizes that the Commission has a clear duty, under both general administrative law and Section 202(h) of the 1996 Telecommunications Act, to reevaluate the broadcast ownership rules to ensure they still serve the public interest in a rapidly changing media marketplace.

Correct me if I am wrong, but you seem to be indicating that there is law that states that the ownership issues are in place to ensure that the public interest is served....not the interest of any particular organization. I would also like to stress here that you seem to recognize that the marketplace is rapidly changing.

Section 202(h) explicitly requires the repeal or modification of the existing ownership regulations if they are no longer necessary in the public interest as the result of competition. In this regard, the Commission must recognize the continuing proliferation of media outlets accessible to American consumers and the profound impact such proliferation has had on the broadcast industry and the need for continued ownership regulation.

Here you seem to clearly state that there is a proliferation of competition, and further you seem to state that the commission is "required to repeal or modify existing ownership regulations" My question is this Mr. Rehr: Would a similar stance not also apply to the licence restrictions originally placed on satellite radio?

The Commission originally adopted its local broadcast ownership restrictions decades ago in a very different media environment.

A very true statement. Would you not agree that even in the last 10 years even more substantial changes have happened?

Technological advancements, the growth of multichannel video and audio outlets and the Internet, and an expansion in the number of broadcast outlets in the past several decades have altered the media marketplace in two fundamental ways. First, consumers nationally and in local markets of all sizes now have access to a vast array of information and entertainment from broadcast and nonbroadcast outlets. Numerous surveys, including a very recent one conducted by BIA Financial Network (“BIA”), have documented this proliferation of media outlets in local markets, and a further BIA study demonstrated that consumers routinely access many additional “out-of-market” outlets. Second, due to this explosion of outlets, as the Commission found even four years ago, traditional broadcasters are struggling to maintain their audience and advertising shares “in a sea of competition.”

Seems that you recognize that there are indeed many forms of competition in this sector.

NAB herein documents how the more recent development of broadband and new video and audio Internet applications have exponentially increased the number of sources for information, opinion and entertainment, and created new and growing competitors for the advertising support that is crucial to free over-the-air media.

So the competition threatens the advertising model used by the NAB membership. Perhaps the NAB should focus some efforts on making their memberships products and content more compelling and diverse.

In light of these technological and marketplace developments, the Commission must seriously consider whether the current broadcast ownership rules continue to serve the agency’s stated goals of competition, diversity and localism. NAB believes that they do not.


Seems that you feel that current ownership regulations do not fit the world of today. Mr. Rehr, might this also apply to satellite radio?

Competition
In a multichannel environment dominated by consolidated cable and satellite system operators, broadcasters are clearly unable to obtain and exercise any undue market power. For this reason, the traditional competition rationale for maintaining a regulatory regime applicable only to local broadcasters and not their competitors is not a proper basis for keeping the current rules. Indeed, the primary competition-related concern in today’s digital, multichannel marketplace is the continued ability of local broadcasters to compete effectively and to offer free, over-the-air entertainment and informational programming that American citizens rely upon. NAB documents, in detail, the audience fragmentation and increasing competition for advertising revenue experienced by broadcast stations, as the result of new entry by cable television, satellite television and radio, numerous Internet video and audio applications, and mobile devices such as MP3 players. To best achieve the Commission’s goals of a competitive media marketplace that provides lower prices, better service and greater innovation to consumers, the Commission should now structure its local ownership rules so that traditional broadcasters and newer programming distributors can all compete on an equitable playing field.

So what are you asking for here? Do you want to begin to pay RIAA fees? Or perhaps you are asking that any content, be it national or local be available to anyone who is broadcasting entertainment and informational services.

A level regulatory playing field is particularly urgent, given that local broadcasters’ most prominent competitors enjoy dual revenue streams of both subscriber fees and advertising revenues.

I see that you spoke about the revenue side of things. Perhaps you could speak to the cost side. Radio subsidies in satellite. The fees paid to the RIAA. The substantial cost of launching satellites, etc. These are costs that the NAB membership do not have to deal with.

Broadcasters, of course, are almost solely dependent on advertising, and local stations today must struggle to maintain needed revenues in a vastly more competitive advertising market.

Did you say "vastly more competitive marketplace"?

Any realistic assessment of today’s media marketplace leads to the conclusion that competition considerations dictate change in the broadcast ownership rules.

Ever consider a change in business model? Ever consider delivering what the consumer wants?

Diversity
NAB submits that the Commission must also consider whether its existing ownership rules are necessary to the traditional goal of promoting diversity. The proliferation of broadcast outlets and the rise of new multichannel video and audio programming distributors and the Internet have produced an exponential increase in programming and service choices available to viewers and listeners. Strong evidence shows that the public’s interest in receiving diverse content is therefore being met both nationally and on a market basis. Numerous studies, including one just completed by BIA, have confirmed that the post-1996 ownership changes within local broadcast markets, especially among radio stations, have enhanced the diversity of programming offered by local stations. This new BIA study also showed that radio stations are providing a wide range of programming targeted for diverse audiences, including minority groups and groups with niche tastes and interests. Moreover, both older and more recent studies indicate that the joint ownership of media outlets in local markets does not significantly inhibit the expression of diverse viewpoints by these commonly owned outlets.

So commonly owned media outlets is a good thing in your opinion. Does that apply to satellite radio as well?

The ability of consumers to obtain diverse programming and viewpoints is only enhanced by the growing level of substitutability between media for both entertainment and informational purposes. Studies previously conducted for the Commission and more recent surveys on media usage reveal considerable substitutability between media for various uses.

To be clear here......You seem to be saying that consumers utilize various formats for their needs.

Indeed, the recent studies showed that multichannel outlets and the Internet compete with – and substitute for – the use of traditional media including broadcast and newspapers for both entertainment and information, especially among younger consumers.

Seems you outline that there is plenty of competition in this area, and that due to that competition you want the ability to "consolidate" ownership.

Localism
As shown by NAB in the Commission’s pending localism proceeding, local stations provide a wealth of local news and public affairs programming, political information, emergency information, other locally produced and responsive programming, and additional, unique community service. But given the relentless competition for audience and advertising shares from the vast array of other media outlets, the real threat today to the extensive locally-oriented service offered by television and radio broadcasters is not the group ownership of stations. Rather, it is the challenge stations face in maintaining their economic viability in a market dominated by consolidated multichannel providers and other competitors. If the Commission seeks to maintain a system of viable commercial broadcast stations offering free, over-the-air service to local communities, then stations must be allowed to form efficient and financially sustainable ownership structures.

So efficient and financially sustainable ownership structures is good for NAB members. Would this "level playing field" situation deliver this as well? Shouldn't others be able to participate in this?

Local Radio Ownership
The Commission must reject calls for stringent ownership restrictions on local radio. Numerous studies have demonstrated that radio programming diversity has continued to increase since Congress opened the door to more efficient and economically viable radio ownership structures in 1996. Stations today serve very diverse audiences, including minority groups, with entertainment and informational programming targeted to their needs and interests. Radio stations also clearly operate in an increasingly competitive marketplace and face continuing audience fragmentation such that even market leading stations must find new ways to earn audience and advertising revenue share.

Imagine that. NAB stations are seeking out an improved business model.

Several previous studies moreover found no evidence that post-1996 ownership changes have lead to increases in the price of radio advertising or other exercises of market power by station groups.

HMMMMM.....So a change in regulation regarding ownership had no impact on advertising fees. Perhaps something similar is then quite possible with subscription prices for satellite radio.

Perhaps most interestingly, two empirical studies have concluded that any potential exercise of market power by radio groups can be countered by the ability of other stations, including smaller groups and individual stations, to gain substantial increases in listening share through programming changes.

Wow, a powerful statement here. might I re-word it a bit? "Perhaps most interestingly any potential exercise of market power bay a satellite radio merger can be countered by the ability of terrestrial radio, internet radio, streaming cell content, WIFI, WIMAX and MP3 services to gain substantial increases in listening share through programming changes". Is that a fair statement?

And, finally, a further NAB study demonstrated that, despite the post-1996 changes in the radio industry, large numbers of radio stations either remain “standalones,” or are part of local duopolies, in their respective markets.

In this current competitive marketplace, NAB supports continuing relaxation of the radio ownership rules.

Perhaps a relaxation in satellite rules is also appropriate

Congress adopted the existing numerical station limits in 1996 before the emergence of satellite radio, Internet streaming of radio stations, the development of Internet applications such as podcasting, on-line music sites, music file-sharing and downloading, and the growth of mobile audio technologies such as MP3 players and even mobile phones.

Seems you agree that there is plenty of competition out there.

XM and Siruis alone now put hundreds of channels of music, news, talk and sports into every local market in the United States, and earn dual revenue streams from subscriber fees and advertisers, all without being subject to comparable ownership restrictions.

You forgot the cost side of things again Mr. Rehr. The cost of implementing these services is fully considered in the scheme of things.

In the Internet age, every local radio station is potentially competing against thousands of radio stations from around the country or the world, and estimated monthly audiences for Internet radio are over 52 million.

Global competition........thanks, I am sure Sirius and XM will use that. Can they quote you directly?

With satellite radio and a host of mobile gadgets, terrestrial radio stations now also face growing competition for listeners while consumers are in automobiles or outside the home or office.

Because past changes in ownership structures have enhanced local stations’ abilities to serve diverse audiences and their communities, without resulting in the exercise of undue market power by radio groups, the Commission should find that a further liberalization of the decade-old radio ownership restrictions would serve the public interest.

So in your own words Mr. Rehr, consolidation can happen without causing undue market power in this hugely competitive market place. Is that correct?

Local Television Ownership
The Commission should reform the television duopoly rule to reflect the current competitive television marketplace and allow more freely the formation of duopolies in markets of all sizes.

More pro-consolidation......HMMMMM

As shown by NAB’s analysis of television market revenues, medium and small market stations compete for disproportionately smaller revenues than stations in large markets. Other specific factors – including the costs of the digital television transition and the decline of network compensation – have combined to further squeeze the profits of local television broadcasters, especially in medium and small markets. A new report on television station finances confirmed the declining financial position of small market television stations, particularly for those stations not among the ratings leaders in their markets. And given the considerable and growing expense of maintaining local news operations, some television stations (even in larger markets) have already been forced by financial considerations to cut back on or forego entirely the provision of local news. These numbers will only continue to grow if local stations are not allowed greater flexibility in ownership structures.

So in the face steep competition, ownership regulations should be relaxed so as to allow better services. A novel concept. I bet it would be applicable to satellite radio as well.

Freely permitting local television duopolies is necessary to preserve and enhance television broadcasters’ ability to serve their viewers and communities in markets of all sizes. As the Commission recognized (and the court affirmed) in the last ownership review, multiple studies and persuasive anecdotal evidence have shown that television duopolies result in efficiencies that produce public interest benefits, such as improved news, sports, weather and other local programming, in all markets including large ones.

There you go.....Production of efficiencies that produce public interest benefits. Seems to me that this is exactly what Sirius and XM are saying. Again, can Sirius and XM quote you directly?

A new BIA study confirmed that stations in local combinations in medium-sized markets are stronger financially and offer more programming preferred by local viewers.

I would bet that a BIA study on a satellite radio merger would conclude that a combination of Sirius and XM woulkd make them stronger financially and allow them to offer more programming preferred by consumers. Can you forward the contact information of someone at the BIA to us? We will be more than happy to pass that along to the folks at Sirius and XM.

The Commission must therefore recognize the positive benefits of reforming the current duopoly rule. Further, it must recognize that the rule, including the top-four restriction, is not necessary in the public interest as the result of competition. The top-four prohibition unduly prevents the formation of duopolies, including those combinations involving financially struggling stations, which would enable stations to compete successfully in local video markets. A strict duopoly rule containing this restriction also fails to properly take into account the competition presented by cable and satellite outlets in local markets, both for viewers and for advertisers. Multiple studies have demonstrated how the competitive position of local television stations has been impacted by increases in cable and satellite viewing and the growth of local cable operators’ share of television ad revenues in local markets. The existing duopoly rule, which remains unduly focused on broadcast television stations alone, simply defies marketplace reality.

Seems there is a lot of competition.

Cross-Media Ownership
As NAB has previously shown, the case for repealing the anachronistic ban on joint ownership of newspapers and broadcast outlets is clear and compelling. The ban inhibits the development of new innovative media services, especially on-line and digital services, and precludes struggling broadcast and newspaper entities, particularly those in smaller markets, from joining together to improve, or at least maintain, existing local news operations. In fact, numerous previous studies spanning several decades have demonstrated that broadcast television stations co-owned with newspapers offer greater amounts of local programming generally, and more local news and public affairs programming specifically, than non-newspaper owned stations. Clearly, the Commission and the court were correct in the last ownership review when they agreed that the blanket ban on newspaper/broadcast cross-ownership no longer served the public interest. In light of ever-increasing new media competition for viewers, listeners, readers and advertisers, this rule – which NAB opposed as unnecessary even in the much less competitive and diverse media market of the 1970s – should not be retained today.

Now there is an interesting business model. Radio, television and print. Seems like something viable.

The radio/television cross-ownership rule similarly does nothing to advance the public interest under current marketplace conditions. The rule is no longer needed to ensure diversity in local markets, but in its current form primarily serves to limit radio station ownership arbitrarily. With television and radio broadcasters facing unprecedented competition from cable, satellite television and radio, and audio and video Internet applications, a cross-ownership rule applicable only to local radio and television broadcast stations is inequitable and outdated.

We agree. The competition is substantial, and there are numerous players in the field of play. So is your argument against a satellite merger because it is in the best interest of you membership or is your concern consumer based? Your arguments here, and in the congressional committee on the satellite radio merger seem to differ......HMMMMM

Particularly if the Commission retains the local radio ownership rule and the television duopoly rule in some form, no plausible reason exists to also retain the cross-ownership rule, as any diversity or competition concerns can be addressed more directly by these other local rules.
Finally, in response to the Commission’s request for comment on proposals to foster ownership of broadcast outlets by minorities, women and small businesses, NAB reiterates its long held belief that the Commission should pursue constitutionally sustainable programs to further opportunities for such groups. NAB recognizes that improving access to capital is key to this effort and suggests ways to achieve this goal, including reform of attribution and auction rules.

For all these reasons set forth in detail in NAB’s comments, the Commission should reform its local ownership rules to reflect the vast technological and marketplace changes that have already occurred and are only accelerating today. Ensuring that local broadcasters are not hampered by outmoded regulation in their efforts to compete and serve their audiences in today’s digital, multichannel environment would clearly be in the public interest.

So, why is it you feel localized programming on satellite radio would not be in the public interest? You want a level playing field on only certain fronts, and that is crystal clear. Mr. Rehr, who's interest do you really have in mind?

Labels: merger, nab, rehr, sirius, xm

2/28/2007 10:55:00 PM

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Does Anyone Really Think The NAB Represents The Consumer?

February 28, 2007

Listening to the hearings before congressional committee today relating to the proposed merger of Sirius and XM, one might have had the impression that the NAB was there to act in the best interest of the consumer. In reading how the NAB defines themselves, you can begin to understand that their interest is with their member stations, and not the consumer. Notice what the NAB is dedicated to, and notice that they fail to mention the consumer anywhere. Do you really think that the NAB is worried about the consumer? Or is it the 8,300 businesses the NAB represents that have Mr. Rehr flying to Washington to oppose the merger. Mr. Rehr, your agenda is clear and transparent.

About NAB The National Association of Broadcasters

"The National Association of Broadcasters is a trade association that advocates on behalf of more than 8,300 free, local radio and television stations and also broadcast networks before Congress, the Federal Communications Commission and the Courts."

Now turn to Sirius

SIRIUS is changing the way people listen to music, sports, news, and entertainment. Operating from its corporate headquarters in New York City's Rockefeller Center, SIRIUS broadcasts over 130 digital-quality channels, including 69 channels of 100% commercial-free music, plus exclusive channels of sports, news, talk, entertainment, traffic, weather and data.

This unique listening experience is available to subscribers from coast-to-coast in the United States. The service can be used in cars, trucks, RVs, homes, offices, stores, and even outdoors. Boaters around the country, and up to 200 miles offshore, can also hear SIRIUS. SIRIUS provides premium quality programming delivered by three dedicated satellites orbiting directly over the United States. SIRIUS' 100% commercial-free music covers nearly every genre - from heavy metal and hip-hop to country, dance, jazz, Latin, classical and beyond, including a dedicated Elvis® channel. Each is prepared and hosted by SIRIUS staff, all of which are recognized experts in their music fields, along with contributing musicians and performers who lend their talent and expertise. This ensures that SIRIUS subscribers can regularly listen to unparalleled music selections, insights and perspectives.

The over 60 channels of sports, news, talk, entertainment, traffic, weather and data offered by SIRIUS have an unmatched lineup of programming, which comes from such top names as Howard Stern, CNBC, CNN, Martha Stewart, ABC News, BBC World Service, E! Entertainment, Maxim, NPR and Radio Disney. SIRIUS carries shows focused on comedy, public affairs, the arts, the trucking life and the full political spectrum from liberal "left" to conservative "right." Around-the-clock traffic and weather reports are provided for the top 20 US traffic markets.
SIRIUS is the leading provider of sports radio programming, broadcasting play-by-play action of more than 350 pro and college teams. SIRIUS features news, talk and play-by-play action from the NFL, NASCAR, NBA, NHL, Barclays English Premier League soccer, UEFA Champions League, the Wimbledon Championships and more than 125 colleges, plus live coverage of several of the year’s top thoroughbred horse races. SIRIUS is the only radio outlet to provide listeners with every NFL game, airs every NASCAR Nextel Cup Series, NASCAR Busch Series and NASCAR Craftsman Truck Series race, and broadcasts over 1000 NBA games per season, plus up to 40 NHL games per week. SIRIUS also features programming from ESPN Radio and ESPNews.

The company’s highly experienced management team is composed of seasoned executives from the entertainment, radio, consumer electronics, music and automotive industries. This team is led by SIRIUS CEO Mel Karmazin.

The nerve center for SIRIUS operations is at Avenue of the Americas and 49th Street in New York City, where the company’s state-of-the art studios are located. Artists including Burt Bacharach, Sheryl Crow, Emmy Lou Harris, Richie Havens, Al Jarreau, Yo-Yo Ma, Lynyrd Skynyrd, Phoebe Snow, The White Stripes, Sting and Randy Travis have visited the studios for performances and interviews.

Broadcasts also are conducted from Los Angeles, Memphis, Nashville, New Orleans, Houston and Daytona – bringing SIRIUS listeners in touch with the centers of music, entertainment and information across America.

Sirius-ready receivers are manufactured to meet the needs of all subscribers, and come in versions for cars, trucks, recreational vehicles, boats, aircraft, the home, offices, stores and for portable use. The receiver product line starts with portable and transportable Plug & Play radios and continues to high-end receivers complete with motorized touch-control display screens, as well as radios that are found in new cars and trucks. SIRIUS products for the car, truck, home, RV and boat are distributed by Alpine, Audiovox, Brix Group, Clarion, Delphi, Directed Electronics, Eclipse, Eton, Jensen, JVC, Kenwood, Magnadyne, Monster Cable, Pioneer, Russound, Tivoli, Thomson and XACT Communications.

Available in more than 25,000 retail locations, SIRIUS radios can be purchased at major retailers including Best Buy, Circuit City, Crutchfield, Costco, Target, Wal-Mart, Sam's Club and RadioShack. SIRIUS is also available at heavy truck dealers and truck stops nationwide.
DaimlerChrysler, Ford, BMW, Audi, Volkswagen, and Kia are SIRIUS' exclusive automotive partners, and their production represents over 40% of the new cars and light trucks sold annually in the United States. SIRIUS radios are currently offered in vehicles from Audi, BMW, Chrysler, Dodge, Ford, Infiniti, Jaguar, Jeep(r), Land Rover, Lexus, Lincoln-Mercury, Mazda, Mercedes-Benz, MINI, Nissan, Porsche, Rolls Royce, Scion, Toyota, Volkswagen and Volvo.

Hertz provides SIRIUS in rental vehicles at locations around the country. In addition, the Penske companies – Penske Auto Group, United Auto Group and Penske Trucking – offer SIRIUS radios as a factory installed option, where available, in cars and trucks through their dealerships.

And Now XM


XM Satellite Radio Inc., an emerging force in broadcasting, was incorporated in 1992 and is a wholly owned subsidiary of XM Satellite Radio Holdings Inc. XM is publicly traded on the NASDAQ exchange since October 5, 1999. XM's founding was prompted by the radio industry's first major technological change since the popularization of FM radio in the 1970s: the creation of a third broadcast medium, transmitted by satellite, now taking its place alongside AM and FM on the radio dial. One of only two companies with a license for this new national audio service, XM has assembled a "dream team" of creative radio professionals and a management team committed to leading the world into the next generation of radio. XM's 2007 lineup includes more than 170 digital channels of choice from coast to coast: the most music in satellite radio, including 69 commercial-free music channels and exclusive live concerts and original programming, plus premier sports, talk, comedy, children's and entertainment programming; and 21 channels of the most advanced traffic and weather information.

XM, the leader in satellite-delivered entertainment and data services for the automobile market through partnerships with General Motors, Honda, Toyota, Hyundai, Nissan and Volkswagen/Audi, is available in more than 140 different vehicle models for 2007.
XM's industry-leading products from manufacturers such as Delphi, Pioneer, Audiovox and Yamaha, among others, are available at electronics retailers nationwide including Walmart, Best Buy, Circuit City, Sears and participating independent dealers.

In addition to our corporate headquarters and broadcast facilities in Washington, D.C., XM has broadcast facilities in New York, Chicago, and Nashville, and additional offices in Deerfield, FL; Novi, MI; and Yokohama, Japan.

I would respectfully submit to you, the SSG reader, that Sirius and XM are far more consumer centered than the NAB could ever hope to be.

Labels: consumer, nab, sirius, xm

2/28/2007 10:29:00 PM

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Bear Sterns Report

February 28, 2007

Bear (Peck): In Line Quarter; In Line Guidance

Revenues were in line in 4Q, as was SAC; EBITDA significantly better due to lower S&M and R&D, but expense discipline was seen elsewhere too

SIRI sub outlook is marginally lower than our current estimate of 8.17m for 2007

We think fundamentals take the back seat during the next few months for both stocks as merger milestones will determine stock movements

Labels: bear sterns, sirius

2/28/2007 06:03:00 PM

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Merrill Report

February 28, 2007

Increasing FY07 subs and EBITDA deficit

We are increasing our FY07 ending subscriber estimate to 8.17mm from 7.77mm as SIRI continues to gain retail and OEM market share of the satellite radiosubscriber base. We expect SAC to decline 17% Y/Y to $95 (new 4G chipset) and total churn (including OEM promotion subscribers) will increase to 2.3% from1.9% (self-paying churn of 1.5%). We forecast FY07 revenue of $1.01bb (+58.8% Y/Y), with slightly higher marketing costs (to allay consumer worries about the merger) and SAC (from raised subscriber estimates) increasing our operating expense to $1.58bb from 1.54bb and resulting in an EBITDA deficit of $263.3mm (up from $195mm). We forecast a free cash flow deficit of $30.3mm, near breakeven, a goal which we believe management remains focused on.

Cautious 1H guidance;

no FCF guidance given merger costs Despite indicating that 1H07 comps are difficult, reflecting the incremental HowardStern subs added in 1H06, management believes SIRI can add 2mm net newsubscribers in FY07 (>8mm ending subs). SIRI will advertise that no radio purchased from Sirius will become obsolete given the proposed merger; a move they hope could reduce confusion in the marketplace so that retail sales remain strong. Management estimates FY07 churn of 2.2-2.4%, and SAC of $95.

Revenue beats MLe, FCF modestly better than MLe

SIRI ended 4Q06 with 6.0mm subscribers. ARPU (less mail-in rebates andadvertising) of $10.39 was higher than expected (driven by lower rebate activity; MLe $9.95) while SAC of $103 was higher than MLe $98 (FM modulator issues added to SAC). Revenue of $193mm was $10mm ahead of MLe. Total operating expense (excluding non-cash expense) was $387.7mm, $19.2mm higher than MLe, largely due to SAC and sales & marketing, resulting in a ($166.8mm) EBITDA deficit – $11mm below MLe. SIRI generated $36mm of positive FCF

Labels: merrill lynch, sirius, xm

2/28/2007 05:59:00 PM

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Bank Of America Report

February 28, 2007

Sirius Satellite Radio Inc. The Underlying Fundamentals for Sat Radio Aren’t Getting Strongerand the Merger Could Be Blocked – We Remain Neutral on SIRI

For 4Q06, key metrics were mixed in relation to our forecast.

Subscriber churn of 2.0% was 20bp higher than our 1.8% estimate due to higher OEM promo churn. Cash metrics were slightly better thanexpected. The “cash” EBITDA loss of $167M was $8M better thanour estimate. FCF was $29M (vs. our $22M estimate).

Guidance for 2007 is slightly worse than our prior forecast –

churn guidance suggests that Sirius’ OEM conversion rates are running 35-40%. We have revised our year-end ’07 subscriber estimate to8.0M from 8.2M. Management expects total subscriber churn of 2.2-2.4% in ’07, up from 1.9% in ‘06. It now appears to us that the OEM conversion rate is trending around the 35-40% range. If Sirius is unable to boost this rate, it potentially could indicate that satellite radio’s demand issues extend beyond the retail channel.

We reduced our ’07 “cash” EBITDA estimate based onmanagement guidance for revenue and SAC –

positive FCF could be as far out as ‘09. Our new “cash” EBITDA loss estimate of $263Mis $58M below our prior estimate. Investment thoughts – we remain Neutral on SIRI and believe that without a deal SIRI’s stock is worth $2.50. We believe there is a less than 50% chance that the merger is approved by regulators, and as a standalone entity we believe that SIRI shares are worth $2.50. The churn increase forecast for ’07 could be indicative of poor OEM conversion rates and suggests downside risk to our fair value estimates.

Valuation and Target Price Analysis:

Our $3.50 TP is based on tax-adjusted DCF and the probability that the merger is completed

Labels: bank of america, sirius

2/28/2007 05:55:00 PM

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Wachovia Report

February 28, 2007

PREVIOUSLY ANNOUNCED SIRI Q4 SUBSCRIBER RESULT IN-LINEWITH OUR REDUCED FORECAST.

• FINANCIAL RESULTS IN-LINE WITH BETTER ARPU OFFSET BYHIGHER THAN EXPECTED COSTS--All-in subscriber monthly ARPU for Q4 was $10.39, nicely ahead of $9.59 consensus which drove revenue of $193M well above consensus of $172M and our estimate of $168M. This was offset by: 1)higher than expected costs to acquire subscribers (SAC) at $103 versus $98 consensus; and 2) higher than expected sales and marketing costs (+$11M) and programming and content costs (+$5M) which drove an operating cash flow loss of$167M (excluding stock expenses) slightly worse than our ($164M) loss andslightly better than consensus of ($180M) loss.

• WEAK 2007 GUIDANCE--SIRI provided guidance of revenues ''approaching$1B'' for 2007 (in-line). SIRI forecast net new sat radio additions of ''more than1,975K,'' materially below (-12%) our estimate (2,246K) and consensus (-18%) (2,405K). The lower than anticipated forecast is related to higher than forecast ’07monthly churn of 2.2 to 2.4%, vs. our 2.0% est. and consensus of 2.1%. The SAC per gross addition guidance was approximately $95 for 2007, which is higher thanboth our and consensus estimate of $90.

• REDUCING ESTIMATES--We are reducing our '07 sub forecasts materiallydriven mainly by increasing churn forecasts to be in-line SIRI’s guidance. We are also reducing our subscriber forecasts in 2008 and beyond. Our '07 OCF loss forecast increases from $247M to $297M. The changes cause us to drop the lowend of our wide valuation range (which is an attempt to capture the widening divergence between the merged value and SIRI as a stand-alone entity).

• WEAKENING FUNDMENTALS CREATE MORE DOWNSIDE RISK SHOULD AN XMSR ($14.32, MARKET PERFORM) DEAL FALLTHROUGH (50% CHANCE)--Continued weakening demand for sat radio bolsters our cautious fundamental stance on the group. We reiterate our belief that weak retail will inevitably begin to negatively affect OEM's appetite for sat radio,further pressuring the long term opportunity for sat radio. Highlighted by our new valuation range, we believe downside risk is increasing should an XMSR deal fail to materialize, while upside from a merger appears priced in the stock at theselevels. At current, SIRI valuation levels imply that SIRI will eventually reach the 20M+ level in subs vs. current 6M (which includes subs on promotions). Valuation Range: $2.5 to $4 Our range is based on a discounted cash flow. We use a discount rate of 11% and a terminal value of 55x 2010E free cash flow. Risks include slower subscriber growth, high content costs and the potential entrance of terrestrial wireless alternatives. Investment Thesis: We are cautious on the outlook for the satellite radio industry and Sirius. We remain concerned regarding continued weak demand for the satellite radio product.

Labels: sirius, wachovia, xm

2/28/2007 05:51:00 PM

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Stifel On Sirius

February 28, 2007

4Q top and bottom line beat nicely, but churn and SAC metrics missed: See our variance analysis for further detail.

2007 Guidance looks achievable to us: We believe SIRI's subscriber guidance is realistic. Our model gets to 8.07MM subscribers using a 20% decline in gross retail additions and a 36% increase in gross OEM additions, driven largely by the ramp-up at Ford from about 7% of vehicles to 28%. We are lowering 2007E EBITDA from a loss of $288MM to a loss of $347MM to account for merger costs ($40MM) and slightly higher SAC ($97/sub vs prior estimate of $90/sub). Our updated model is attached.

SIRI's self-pay churn trend is substantially better than its overall churn and XMSR's churn. SIRI guided to higher churn in 2007 (2.2-2.4% from 1.8% in 2006). This includes the 45% of subscribers on free trials that do not convert to paying subs. SIRI noted self paying churn was about 1.65% in 4Q06 with no expected change - well below XMSR's self paying churn of 1.8%.

SIRI is a better stand-alone investment than XMSR: This is mainly because we believe XMSR has some merger premium priced into the stock. We continue to derive a $5 target with no merger synergies for SIRI. Our target is based on a 5-year DCF with a WACC of 10.2% and a terminal EV/FCF multiple of 9.1x. The key driver of value is new car penetration, which we forecast will continue to ramp up from 22% of production in 2006 to 65% by decade-end. We continue to see a 55% chance of merger approval, which could add $1 to our target for Sirius shares

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2/28/2007 05:46:00 PM

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Bridge Ratings, Updated Feb 28th, Satellite Radio Merger Study

The Bridge Ratings Consumer Satellite Radio Merger Perceptual Study
Wednesday February 28, 2007

News of Proposed Merger Likely to Impact 2007 Subscriptions
As serious rumors of a possible satellite radio merger began surfacing in 2006, Bridge Ratings began interviewing current and potential satellite radio subscribers to learn about their perceptions and possible actions should such a merger occur. The following data summarizes much of what we have learned.
For the purposes of this study, Bridge Ratings interviewed consumers at retail outlets who have purchased Satellite radio. Telephone surveys were also conducted between August 1, 2006 and February 23, 2007. Calls were placed to both current and potential subscribers to satellite radio.
I. Consumer Interest Index (CII) :
Since 2003, Bridge Ratings has conducted Consumer Interest surveys in order to project the potential size of the satellite radio subscriber base. Over time marketing by both satellite radio companies has heightened awareness and interest in the medium...read more: here

2/28/2007 04:10:00 PM

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Cowen Believes Sirius & XM Are On The Cusp of Cash Flow Boom

Analyst: XM, Sirius Set For Cash Flow Boom
Matthew Kirdahy, 02.28.07, 1:09 PM ET, www.forbes.com

A Cowen & Co. equities analyst believes shares of the XM Satellite Radio and Sirius Satellite Radio are on the cusp of breaking loose.
In a note to investors Wednesday, Cowen analyst Tom Watts said both stocks will post gains in the second half of the year.
"They are just on the verge of demonstrating exceptional operating leverage and cash flow generation," he wrote. "The merger approval process, which we expect to result in approval, will cloud the picture, but we expect both stocks to appreciate in the second half."
XM Satellite Radio and its lone rival Sirius Satellite Radio agreed on a merger of equals Feb. 19.
Under the terms of the agreement, XM shareholders will receive 4.6 shares of Sirius stock for each share of XM they own. XM and Sirius shareholders will each own approximately 50% of the combined company.
XM would be bringing more than 7 million subscribers to the table, while Sirius carries more than 6 million. (See: "Subscriber Boost Narrows XM Loss" ).
The deal is valued at $13 billion and is in limbo pending the necessary government approvals. (See: "Sirius, XM Want To Make Music Together.") The House Antitrust Task Force is currently holding a public hearing examining the proposed merger.
"The strongest argument to approve the merger would be that one of the players would fail if not approved," Watts said. "High spending and continued losses by XM will hlep paint that picture."...read more: here

2/28/2007 01:36:00 PM

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Deutsche Bank On Sirius

February 28, 2007

Maintain $5.25 12-month TP, as pending merger a cushion for slower growth Management's YE2007 guidance of 8m+ was lower than our 8.2m estimate, although cost expectations (ex-merger) were in line. Mgt's view that the retail category may not grow until 2H are no surprise given down 40%+ trends YTD against tough comps. 2007 churn guidance of 2.2%-2.4% was ahead of our 2.1% estimate, and suggests that OEM net sub add growth could slow a bit from 2006 as well. We rate Sirius as a Buy on economical growth in the U.S. satellite radio market, in particular in vehicles.

Retail’s 54% mkt share drove 4Q growth, although $103 SAC slightly missedRetail/rental net sub additions were 556k, ahead of our 545k estimate, while OEMnet adds of 349k were below our previous 360k est. Avg monthly churn was 2.0%, above our 1.8% estimate, reflecting some increase in roll off of bundledplans. SAC per gross add was a bit higher than our $100 estimate.

Pending merger, no 07 FCF guidance-our loss est goes to $165m from $238m Sirius’s full-year guidance of “approaching” $1bn in revenue and c$95 per grosssub add were in line with our estimates of $957m and $96, respectively. Management said that it expected to substantially reduce its adj. op. loss and FCFloss from 2006 levels of $513m and $501mm, respectively. We are boostingsome of our fixed cost estimates, notably programming and G&A, so that positiveFCF is pushed to 2009 in our model (we expect satellite capex in 2008).

Buy rating reflects 12-mo TP of $5.25 and 50% change of merger approvalOur target price is based on a DCF assuming 14.5m Sirius subs by 2010, 27m by2020, a 4% TVG and 14% WACC and merger analysis assuming $5bn in synergiesand 50% probability of deal completion with few material conditions. Risks includechanging market for technology-driven businesses, subscriber growth volatility,competing technologies, rising costs, adverse legal or regulatory developments(including failure to gain merger approval).

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2/28/2007 12:56:00 PM

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Morgan Stanley On Sirius

February 29, 2007

What's Changed
YE07E Subscriptions From 8.62 mm to 8.34 mm

FY07E Adj. EBITDA From ($365.2) mm to ($300.8) mm


Conclusion: We are reducing our FY sub growth expectations to 8.3 mm- still ahead of SIRIannounced guidance of 8.0+ mm. While we believe SIRI subscription guidance partially reflects the potential of a confusing consumer message in FY07, we believe the 8.0+ mm target is conservative. Our forecast currently assumes continued deceleration of retail growth in FY07
(estimated down 10%) and that net adds will be more back- end loaded during the year. We are not changing our OEM expectations for either gross adds growth (up 55%) or net adds (1.1mm). We forecast SIRI pre-marketing EBITDA margins will increase to 31% from 14% in FY06. This compares to our expectation of pre-marketing EBITDA margins of 28% for XM in 2007.
SIRI ended 2006 with roughly $400 mm in cash, and we believe it will burn through $170 mm in 2007.

What's New:

SIRI reported strong 4Q06 results with ARPU of $10.48 and SAC of $103 coming in ahead of
our estimates. Although subscriber results were announced in January, sub growth in the quarter was more heavily weighted towards OEM than expected. Retail gross additions declined 25% YoY in 4Q06 but were up roughly 20% YoY on a full year basis. We currently expect total SIRI gross additions to increase 13% from FY06 but retail gross adds to fall 10% YoY in FY07E.

Implications:

We believe a SIRI-XMSR merger could generate roughly $4- 5 bn in merger synergies. We note
that our revised forecasts following the merger announcement do not assume a price increase for either operator. We had previously expected SIRI to raise prices in 2007, leading to a one-time cash benefit from
pre-paid subscriptions

Labels: morgan stanley, sirius

2/28/2007 12:49:00 PM

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RBC Weighs In On Sirius

February 28, 2007

Report Excerpt:

Event
Reports 4Q and Full Year Results

Investment Opinion

SIRI Trading Based On Probability Weighted Arb Spread And Synergies—

Sirius and XM agreed last week to combine, pending regulatory and shareholder approval, in a merger of equals. We believe Sirius is currently trading more in-line with expected synergy realization based on the
probability of the transaction closing. However, 2007 guidance indicates a muted sub outlook and higher than expected churn and SAC.

• Maintaining Sector Perform with new $3.50 price-target (from $4), reflecting reduced long-term retail channel sub growth in our model, higher long-term churn and SAC expectations, and non-merger economics though we believe a >50% chance of the merger closing implies $0.87 in additional synergy value per share.

• Still trading at a 24% premium to XM on EV/Sub basis despite having 11% fewer '07E ending subs.

4Q06 Basically In Line - Reflects Good Execution—

Despite lowering guidance (after raising it) to management's original 2006 guidance, SIRI has generally executed consistently with expectations. ARPU of $10.92 was ahead of our estimates and SAC was down 9% YoY. Subscriber growth of 905K was already pre-released in early January.

Primary Focus On Churn Guidance—

While management's FY07 >$8mm ending subscriber guidance was probably not too far from buy side expectations, SIRI's expected 2007 churn range is modestly higher than our 2.1% estimate, reflecting a maturing OEM channel as more OEM subs become paying subscribers. Our new 2.2% 2007 churn expectation incorporates 2.5% / 1.6% OEM / retail churn, respectively, and magnifies our longer-term subscriber projections. While we acknowledge solid execution thus far, we note that we see more downside than upside risk to our estimate given the limited visibility created by the rapidy ramping OEM channel.

2007 Sub Guidance Not Conservative or Aggressive—

Our new 8.1 mm (previously 8.2mm) ending sub expectation incorporates an estimated 20-30% decline in gross retail adds, which remains the largest question mark heading into the year, particularly given potential consumer confusion over merger implications. We are also raising our SAC p/ gross sub expectation to $95 (in-line with guidance) from $88

Labels: rbc, sirius

2/28/2007 12:40:00 PM

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Merger Talk:Hear Today's Live Webcast

Wednesday 02/28/2007 - 3:00 PM 2141 Rayburn House Building Full Committee Hearing on: “Competition and the Future of Digital Music” Before the Antitrust Task Force, to be established by resolution on the morning of February 28, 2007. By Direction of the Chairman

Link to live webcast: here

2/28/2007 07:14:00 AM

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Merger Talk: Washington Post Weighs In

House Gets First Crack At XM-Sirius Proposal
By Charles Babington, Washington Post Staff Writer, Wednesday, February 28, 2007

Congress and federal regulators need to get with the times.
That's the message that Mel Karmazin, chief executive of Sirius Satellite Radio, plans to deliver today at the first public hearing on a proposal to merge the nation's two satellite radio companies, Sirius and XM Satellite Radio Holdings.
;
Karmazin, who will face skeptical members of the House Judiciary Committee's newly formed antitrust task force, says satellite radio is in stiff competition not only with free, over-the-air radio but also with such newer products as MP3 players, Internet radio and music-downloading cellphones. "What I need to do is lay out the realities of the marketplace as we see it," Karmazin said in a telephone interview yesterday...read more: here

2/28/2007 07:06:00 AM

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Merger Talk: BusinessWeek Says Concessions Might Boost Their Case

New Conditions May Ease XM-Sirius Merger
As the satellite-radio providers seek Congress' approval to wed, competition from iPods—and a few concessions—might boost their case
by Steve Rosenbush , Feb 28, BusinessWeek

The proposed $13.6 billion merger between satellite radio players XM Radio (XMSR) and Sirius Satellite Radio (SIRI) would seem to violate conditions that government regulators placed on the companies years ago (see BusinessWeek.com, 2/21/07, "Satellite Static: The XM-Sirius Merger"). When the Federal Communications Commission granted the radio licenses to the companies in 1997, the commission's decision specified that they couldn't be owned by the same entity.
The companies claim that their merger agreement will nonetheless win approval of the FCC, a view that's supported by many analysts who follow the industry. George Reed-Dellinger of researcher Washington Analysis says the odds of approval are "60% plus."...read more- here

2/28/2007 07:03:00 AM

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Streaming Sirius On Your Cell Phone

Siriusly Streaming on the 8525 and Traveling with Maps
Tutorials, by Cecilia on 2007/2/27 1:30:00 (93), www.gadgetnutz.com

One of the most interesting and exciting developments of cell phones is being able to stream content. And especially exciting for me is streaming Sirius radio. Sure having a Sirius radio is great and they make various models that can be taken between car and home (and the Stiletto has WiFi as well as satellite grabbing abilities), but flexibility is always a good thing. Being able to listen in with one's cell is convenient.
There's a free program for phones like the 8525 to grab a Sirius Stream. Get the Current Release of SiriusWM5 at geekstoolbox. You must join the forum to get the cab file. Just copy the cab file to your storage card and once there click on it to install. Once installed in the phone's memory - don't install on the storage card - just start it up. The Sirius Dog icon will be in your Programs listing. Access the settings from the menu and write in your login name and password. Save the settings and try connecting. You will be shown a "captcha" image which requires you to input the text and numbers you see there. You have to do this everytime you connect. Yes, it's very annoying, but this is the way Sirius is handling their security at the moment. Of course this means that if I have to reconnect repeatedly I get really impatient. Click the thumbnail on the left (Sirius Dog) to see a gif anim of the various screens you can see after the program has started. One of those screens shows TCPMP, which I have set up SiriusWM5 to automatically begin when I want to start streaming. So why am I using that instead of Windows Media?...read more: here

2/27/2007 08:24:00 PM

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Merger Hearings: More Ammunition For SIRI-XM

YouTube (aka Google) is entering the realm of audio competitors. Bring this press clipping to your meetings on the Hill tomorrow!

YouTube signs streaming deal with Wind-up Records
By Candace Lombardi, CNET, Tue Feb 27 10:28:29 PST 2007

YouTube has signed a deal that will enable it to include music videos from Wind-up Records for streaming on its site, the record company announced Tuesday. Wind-up Records also announced that it is pre-clearing certain tracks that people can use for their own videos. YouTube and Wind-up will share advertising revenue sold around the content. Wind-up Records has produced albums from artists like Evanescence, Strata and Seether, as well as the Walk the Line soundtrack. It is one of the largest independent record labels in the U.S., but is distributed by Sony/BMG Entertainment....read more: here

2/27/2007 02:54:00 PM

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Merger Talk: Congressional Hearings

Well, at least they're not stalling. The first congresssional hearing is scheduled for tomorrow, Feb 28th, and the second house committee hearing is scheduled for March 7th.

2/27/2007 02:28:00 PM

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Radio Shack Earnings: Lookin' Good!

RadioShack quarterly profit rises; stock jumps
Tuesday February 27, 1:38 pm ET NEW YORK (Reuters) -

Consumer electronics retailer RadioShack Corp. (NYSE:RSH - News) reported higher quarterly profit on Tuesday after a restructuring improved inventory management and cut costs, sending its shares up as much as 17 percent. The company also forecast stronger-than-expected earnings for 2007 and analysts said the improvements showed the company's new chief executive was managing to turn around the struggling business. Fourth-quarter earnings rose to $84.5 million, or 62 cents a share, from $51.2 million, or 38 cents a share, a year earlier.
Analysts on average expected profit of 41 cents a share, according to Reuters Estimates.
Amid declining sales of wireless products, RadioShack is trying to stabilize its business by closing stores, clearing slow-moving inventory and replacing it with more popular products...read more: here

2/27/2007 02:22:00 PM

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Sirius Conference Call Highlights

February 27, 2007


The Sirius Conference call is now complete and many interesting pieces of information were delivered:

- Sirius captured 67% of the NET addition in the market for both Q4 and 2006

- Sirius lead the sector in GROSS additions. This is the first time that Sirius has accomplished this. Sirius had 54% of GROSS in Q4.

- Sirius had $30,000,000 in free cash flow. This included capital expenditures.

- Sirius had an industry leading self paying churn of about 1.6%, and a fully loaded churn of about 1.9%. Both metrics compare favorably over that which XM reports.

- Revenue was a bit over $193 million

- Family plan accounts for between 13% and 14% of subscriber base. This compared to 22.9% for XM. This metric in particular gives Sirius some room to grow the subscriber base.

- ARPU was $11.01.

- Ad Revenue accounted for $8.4 million

- SAC was $103 for the quarter and $114 for the year

- NET loss was a bit over $245 million for the quarter and a bit over $1.1 billion for the year

- Subscriber guidance for 2007 - Over 8,000,000

- Fully loaded churn of between 2.2% and 2.4% for 2007

- SAC of $95 for 2007

- Generation 4 chipset which promises efficiencies in size capability and battery life are now in production with ST Micro.

- Sirius NAV is rolling out this month with Chrysler

- Sirius became the satellite radio sales leader at Walmart and also won supplier of the year award for the retailer

- HM has been up and running for 4 months

Labels: conference call, sirius

2/27/2007 09:40:00 AM

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SIRI: Analyst Comments Begin To Roll In

Amtech:

Sirius Satellite: Color on qtr (3.74 ) -Update-
Amtech notes that SIRI subscriber additions of 905k were pre-announced on Jan. 5th. They note that financial results were better than expected, with revenue of $193 mln better than consensus of $175 mln and EBITDA loss of ($167 mln) was better than consensus of ($217 mln). They note that mgmt expects to add around 2 mln new subscriber, roughly inline expectations of around 2.1 mln. They say revenue is expected to approach $1 bln, a touch lower than consensus of $1.014 bln. Churn is expected to be 2.2% to 2.4%. While unclear, they believe consensus was around 2.1%. Firm says mgmt is not providing P&L guidance "in light of the pending merger with XM, and the uncertainty surrounding the timing and financial impact". With expected close around year-end, they think management is being evasive. Firm thinks XMSR's subscriber guidance was relatively inline, but EBITDA loss was significantly lower as they expect higher spending to stimulate demand.

S&P:

Sirius Satellite Radio (SIRI) Maintains 3 STARS (hold) Analyst: Tuna Amobi, CPA, CFA After pre-announced net subscriber additions of 905,000, Sirius posted a fourth quarter loss per share of 17 cents vs. a 23-cent loss one year earlier, 3 cents and 2 cents narrower than S&P and Street views. Except for churn and retail slowdown, we see improving metrics, including subscriber acquisition costs, average revenue per user and auto OEM gains. Sirius guides, in our view, cautious 2007 2 million net adds, with $1 billion total revenues (vs. 2006's $637 million), 2.2%-2.4% churn (vs. 1.9%) and $95 acquisition cost per subscriber (vs. $114). We are cautious on regulatory outlook for pending merger with XM Satellite Radio (XMSR) and are keeping our target price of $4.50 on relative enterprise value/sales.

2/27/2007 09:16:00 AM

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XMSR: Analyst Comments Begin To Roll In

Wachovia:

XM Satellite: Weakening fundamentals create more downside risk should SIRI deal fall through - Wachovia (14.93 )
Wachovia notes XMSR previewed weak Q4 net sub adds of 442K well below their original est of 650K. As expected, XMSR reported very weak '07 guidance including that XMSR will add 1.37 mln to 1.57 mln net new sat subs, or 25% to 34% below firm's and consensus' 2.0 mln est. The result would represent a 7% to 19% decline from 2006's anemic net sub add result. They note the guidance appears driven by continued weak retail demand for the sat radio product. Firm says continued weakening demand for sat radio bolsters their cautious fundamental stance on the group. They reiterate their belief that weak retail will inevitably begin to negatively affect OEM's appetite for sat radio, further pressuring the long term opportunity for sat radio. Further, firm believes weakening demand and a rich valuation were primary reasons for XMSR's' decision to accept a merger.

Sanders Morris:

XM Satellite Radio-XMSR 2007 subs guidance is beatable-Hold@SMMI
- Sanders Morris believes the beatable subs number cou XM Satellite Radio-XMSR 2007 subs guidance is beatable-Hold@SMMI - Sanders Morris believes the beatable subs number could act as a catalyst to increase share value if guidance is raised.

RBC:

XM Satellite-XMSR target lowered to $14 from $16 on non-merger economics-OP@RBCM - RBC lowered their target as they bel XM Satellite-XMSR target lowered to $14 from $16 on non-merger economics-OP@RBCM - RBC lowered their target as they believe the company's
2007 guidance indicates a weak outlook and higher than expected costs driven by the merger.

Pacific Crest:

XM Satellite Radio-XMSR fundamentals remain weak, see no catalyst -SP@PACS - Pac Crest believes the stock will trade on XM Satellite Radio-XMSR fundamentals remain weak, see no catalyst-SP@PACS - Pac Crest believes the stock will trade on merger sentiment.

2/27/2007 08:12:00 AM

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Sirius Reports Q4 And 2006 Earnings

Sirius Reports Fourth Quarter and Full Year 2006 Results

- Achieves First-Ever Quarter of Positive Cash Flow from Operations and Free Cash Flow - 2006 Revenue Increases 163% to a Record $637 Million - Highest Satellite Radio Subscriber Share in Company's History - 2007 Outlook For More Than 8 Million Subscribers and Revenue Approaching $1 Billion - Executed Definitive Merger Agreement with XM Satellite Radio
NEW YORK, Feb 27, 2007 /PRNewswire-FirstCall via COMTEX News Network/ -- SIRIUS Satellite Radio (Nasdaq: SIRI) today announced record full year and fourth quarter 2006 results driven by an 82% increase in subscribers to more than 6 million, positive free cash flow in the fourth quarter and the highest satellite radio subscriber market share in the company's history.

"In 2006, SIRIUS added 2.7 million new subscribers, an annual record for satellite radio, and captured 62% share of satellite radio subscriber growth. More importantly, SIRIUS achieved positive free cash flow in the fourth quarter 2006 -- four years after adding our first subscriber," said Mel Karmazin, CEO of SIRIUS. "The fourth quarter marked the fifth consecutive quarter of satellite radio subscriber leadership for SIRIUS and a record 67% of satellite radio growth. We look forward to another year of strong growth in 2007, anticipating that we will approach $1 billion in total revenue. The pending merger with XM will offer unprecedented choice for consumers and create tremendous value for our shareholders."
SIRIUS ended 2006 with 6,024,555 subscribers, up 82% from 3,316,560 subscribers at the end of 2005. Retail subscribers increased 64% in 2006 to 4,041,826 from 2005 retail subscribers of 2,465,363. OEM subscribers increased 138% in 2006 to 1,959,009 from 823,693 at the end of 2005. During the fourth quarter 2006, SIRIUS added 905,247 subscribers, or 67% of satellite radio net additions...read more: here

2/27/2007 07:31:00 AM

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Competition

February 26, 2007

The merger was announced on Presidents Day, and Sirius and XM have already met with the five members of the commission at the FCC. XM had their Q4 conference call today, and Sirius will announce tomorrow. Wednesday Mel Karmazin will be speaking to congress in relation to the merger, and application to the DOJ should happen at some point next week. Application to the FCC will follow shortly there after.

The key element in the merger debate will center around the definition of the marketplace, and whether this merger would upset a balance for consumers. On the face of it some may be inclined to think that this merger would create a monopoly. This stance is only true if you look at a very narrow definition of the market, and feel that terrestrial radio, I-Pods, MP3 players, Internet radio, streaming content over cell phones, etc. are not in the business of providing audio and/or video content to consumers.

The fact of the matter is that satellite radio has many competitors. There are aspects of this that satellite radio has advantages with, but there are also aspects where satellite radio is at a disadvantage.

Do AM and FM radio subsidize radio installations in cars? Do they have a fee associated with their service? They have a lock on local content, but also are subject to censorship. Consumers can listen for free, but drive to far, and you lose your signal. There are distinct advantages as well as distinct disadvantages in that segment of the media entertainment sector.

Similar arguments and stances can be stated for I-Pods, MP3's, intent radio, and streaming cell phones.

It boils down to the acceptance that all of these technologies are indeed competing for the ears of the consumer, and this fact is indisputable.

Most analysts believe that the competition requirements of this proposed merger can be easily argued, proven, and won. I have yet to hear a compelling argument that all of these other content providers are not in competition with satellite radio.

On face value, and given what is already known regarding the availability of content and choices, most would be hard pressed to carry an opinion that the DOJ will nix the deal. Time will tell, and there will be a lot of discussion on the subject. Boils it down to the simplest terms, and you can arrive at but one conclusion.

Labels: competition, merger, sirius, xm

2/26/2007 11:15:00 PM

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Get a SIRIUS Radio: Now for the low, low price of $0!

Get the Starmate 4 for only $60 with purchase of an additional, pre-paid 6-month subscription at just $6.99 a month.* Whether it’s in your other car, home or office – now you can enjoy SIRIUS wherever you are!
As a valued customer, you already love the sports, news, entertainment and 100% commercial-free music. With your additional subscription, there’s even more music to share. That’s more Howard, more music and more NFL, NBA and NHL® action. Plus NASCAR® — 24/7 coverage of every race and everything in between.
Coming soon, The Foxxhole, an exclusive urban comedy, entertainment and lifestyle channel with Academy Award®-winning actor, American Music Award-winning and GRAMMY®-nominated artist, and comedian Jamie Foxx. Also, stay tuned for Siriusly Sinatra, the 24-hour, seven-day-a-week, commercial-free channel spanning the entire spectrum of Sinatra’s career, as well as other artists from the big band, swing and traditional pop genres.
This offer is for subscribers only so be sure to log on with your username and password. Offer ends April 15, 2007.

CHECK OUT THESE OTHER GREAT SUBSCRIBER OFFERS
STILETTO 10Just $124.99
with purchase of additional pre-paid 6-month subscription*
Sleek, stylish, personal, easy and completely portable, the Stiletto 10 lets you listen to live and recorded SIRIUS content — almost anywhere. Be alerted when your favorite songs or artists are playing on any Sirius music channel with S-Seek. Stiletto 10 also features intuitive recording of your favorite 100% commercial-free music channels.

FREE SIRIUS ONE
with purchase of additional pre-paid 6-month subscription.*
The simplified design combined with the versatile mounting options and reversible display allow the SIRIUS One to be placed on the visor, dash or console. The large, high-contrast single-line display allows for quick, easy-to-read access to information. SIRIUS One has been perfected for those looking for the easiest way to get SIRIUS content into their car...read more: here

2/26/2007 10:49:00 PM

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Orbitcast: XM/Sirius Merger Is Different Than EchoStar/DirecTV

XM/Sirius merger is not like EchoStar/DirecTV - and here's why
via www.orbitcast.com, Feb 26

As I'm reading coverage on the XM/Sirius merger, there's a common point of reference being brought up when the media looks to find prior parallels, and that obviously is the EchoStar/DirecTV deal.Understandably because the two seem very similar (I used it myself in the past). Echostar/DirecTV is afterall probably the only precedent to work with. Both involve two companies, broadcasting via satellite, and the only difference is that one does video, while the other does audio. Sounds simple right?Except that in 2002, the definition of the "relevant market" involved only satellite and cable (also known as the MVPD or "Multichannel Video Programming Distribution" market). Even "free" television is delivered through satellite or cable because receiving television via the ol' rabbit-ears just isn't a viable alternative (so much so that in 2008 the FCC is selling off the VHF side of the spectrum)...read more: here

2/26/2007 10:44:00 PM

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XM Announces Q4 And 2006 Earnings

XM Satellite Radio Holdings Inc. Announces Fourth Quarter and Full Year 2006 Results
(Links to conference call replay and transcript below)

XM Adds Nearly 1.7 Million Net Subscribers in 2006
2006 Revenue Increases 67% to $933 Million
XM Achieves Positive Cash Flow from Operations in the Fourth Quarter of 2006
XM and Sirius to Combine in $13 Billion Merger of Equals
WASHINGTON, Feb. 26 /PRNewswire-FirstCall/

XM Satellite Radio Holdings Inc. (NASDAQ: XMSR) today reported financial and operating results for the fourth quarter and full year ended December 31, 2006. XM announced that 2006 revenue increased year over year by 67 percent to $933 million. XM added 1.696 million new net subscribers in 2006 for a total of 7.629 million subscribers, and XM achieved positive cash flow from operations in the fourth quarter.
"2006 was a pivotal year for XM," said Hugh Panero, XM CEO. "The automobile market is emerging as a key catalyst for satellite radio's future growth, and XM is well-positioned through its relationships with the nation's largest and fastest-growing automakers. Our financial metrics are heading in the right direction as marketing costs have declined and our revenues have increased."...read more: here

Link to replay of conference call: here

Link to transcript of conference call: here

2/26/2007 10:38:00 PM

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Howard 100: Mel Stops By To Chat

Karmazin Talks XM/Sirius Merger With Howard Stern
February 26, 2007, www. fmqb.com

Sirius Satellite Radio CEO Mel Karmazin was on The Howard Stern Show today discussing the proposed merger with XM Satellite Radio. Karmazin was on for over an hour, tackling topics related to the merger. When asked how the merger came about, Karmazin said, "The big catalyst, and I hate to admit this, because I'm really disappointed in how our stock has performed, is the fact that the stock prices have gotten so low that when you take a look at the value creation of a merger, it becomes something that neither company could ignore."
Karmazin stressed similar themes found in last week's press conference announcing the merger, stating he thinks it will be approved because they aren't competing with XM, but rather with all the other audio entertainment options. He also pointed out that terrestrial radio annual reports list satellite radio as a competitor...read more: here

Click here to listen to the interview (54 minutes)

2/26/2007 10:33:00 PM

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Record Labels Weigh In On Merger

Labels weigh potential fallout of satellite merger
Sun Feb 25, 2007 7:10PM EST, By Brian Garrity, NEW YORK (Billboard)

Would a merger between XM Satellite Radio and Sirius Satellite Radio be good or bad for the music business? That's the question industry executives have been wrestling with since the two companies announced plans to combine in a $13 billion deal that creates a single satellite radio behemoth. Officially, label executives are taking a wait-and-see approach. But privately, they are debating the ramifications of the tie-up on everything from promotion opportunities to licensing revenue to existing litigation strategies. Some of the biggest question marks surround the impact of consolidation on satellite radio's role as a promotion and exposure platform. XM claimed 7.6 million subscribers at the end of 2006, while Sirius had 6 million. If the two companies are integrated, similar channels likely will be eliminated, giving the labels fewer outlets where they can promote new artists...read more: here

2/25/2007 09:30:00 PM

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Merger Talk: Craig Moffet Of Bernstein On C-Span

ON THE COMMUNICATORS, C-Span, Feb. 24th

Craig Moffett, Sanford C. Bernstein & Co. This week's guest on "The Communicators," a new C-SPAN series that focuses on the people and events that shape telecommunications policy is Craig Moffett, Sanford C. Bernstein & Co., Sr. Analyst, US Cable & Satellite B'casting. Mr. Moffett is an analyst of U.S. Cable and Satellite Broadcasting and will discuss the proposed merger of XM & Sirius satellite radio. FROM SATURDAY, FEB. 24...read more: here

2/25/2007 09:23:00 PM

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New York Times: More Merger Comments

February 25, 2007, Dealbook, The New York Times

When Unequals Try to Merge as Equals
By ANDREW ROSS SORKIN

HERE’S a tip about deal-making: When companies start talking about a “merger of equals,” someone is usually getting the better deal. It is especially true in the proposed merger of XM Satellite Radio and Sirius Satellite Radio.
It is being billed as a merger of equals, with each company getting exactly half of the new entity.
But here’s the unequal part: The stock market thinks that Sirius is worth almost $1 billion more than XM. To get the numbers to work, Sirius offered to pay a handsome 22 percent premium to shareholders of XM. (The premium is actually almost a whopping 30 percent if you account for the run-up in XM’s shares the Friday before the deal was announced, as word began to leak.)
So why did Mel Karmazin, the chief executive of Sirius, dress up the deal as if both companies were on the same footing?
I called Mr. Karmazin soon after the deal was announced to ask just that.
“If you give me a lie detector test,” he said, “I’ll tell you that I believe we’re worth more than them.”...read more: here

2/25/2007 09:18:00 PM

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Satellite Radio Makes The NY Post

OPRAH'S LEMONS MAY MAKE MEL'S LEMONADE
By DAMON BROWN, The New York Post, February 25, 2007

Oprah Winfrey's failure can be one of Mel Karmazin's keys to victory.
The queen of all media caused barely a ripple last fall when XM Satellite Radio announced she would get her own channel, "Oprah and Friends."
In fact, when the star of daytime TV, movies, Broadway and magazines landed on XM in the third quarter of 2006, there was a 54 percent decrease in new subscribers - 285,000 versus 617,152 in the previous year.
Not exactly the 138 percent increase in subscribers that greeted Howard Stern's arrival on Sirius.
On Wednesday, Sirius CEO Karmazin will trudge up to a Capitol Hill hearing to try and convince lawmakers his proposed merger with rival XM isn't anti-competitive. He could trot out the failure of Winfrey, Martha Stewart, and even Nascar to spark a new-subscriber wave as evidence the universe of audio entertainment extends well beyond the country's two ailing satellite radio businesses...read more: here

2/25/2007 09:15:00 PM

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XM Conference Call

February 25, 2007

The XM satellite radio Conference Call is scheduled for Monday morning. Contrary to past calls, the important factors here have now shifted. Given the merger news, it is the outlook that will overshadow the Q4 and 2006 numbers.

Typically we would generate an article outlining and detailing our opinion of where the numbers will come in. Given the shift of importance, we will change our methods slightly.

EPS

The street is expecting a loss of 71 cents per share. We expect XM to beat that number. The number of gross additions was not as robust as XM had hoped for, but with fewer subscribers comes fewer expenditures. XM did not spend aggressively as they did in Q4 2005. This will help the bottom line. Investors need to be aware that there were some refinancing expenses that happened early in the quarter that could impact the number.

SAC - CPGA

This figure is now a bit of a wild card. Nissan, Toyota and Hyundai installs for Q4 would count towards SAC and CPGA, but these installs are not counted as subscribers. in simple terms this means there are added costs on one side, and the benefit of using these installs in the divisor of the equation are not there. The level of impact will depend on the number of installs from these OEM partners. We anticipate that installation ramp-ups here are not yet substantial. We feel that XM will talk about a new metric to better define this situation. This new metric will likely be called something like "Promotional Installations". This type of metric is more important later in 2007, but XM should get the ball rolling. This will help investors understand why SAC and CPGA are rising a bit, and give the street an idea of what to expect going forward.

ARPU

ARPU should remain fairly steady, and may see a slight bump in the advertising category. Advertisers are beginning to gravitate to satellite radio, and names such as Oprah help that process along.

DEFERRED REVENUE

This metric will be one that the street will begin to watch closely. Satellite subscribers have a tendency to pre-pay for several months, or even years in advance. This will be the last report from XM where the merger news was still unknown. Going forward it will be interesting to watch this line. We would expect that the average pre-pay will decrease going forward given the merger news and consumer uncertainty.

CHURN

Churn will likely be right around 2% on the self paying side, and about 2.9% overall. Many are watching to see if there was an impact on XM due to the NASCAR move to Sirius.

SUBSCRIBERS

The NET number is already known. Now it is time to see the GROSS numbers and the breakdown between OEM and Retail. Retail has been disappointing for XM for the past year, and there is a danger that at some point, if the retail share does not improve, that XM will have a virtual wash at the retail level. Such an event in and of itself would be very concerning to the street. In the face of a merger, the concern may be somewhat alleviated. We expect a bit over 600,000 deactivation's on a whole.

TAKE RATE

This metric has become more important in the minds of many. People seem to feel that the OEM channel will be very important to SDARS this year. Keeping the take rate above 50% seems to be important. If the take rate dipped below 50%, it could be cause for concern.....but again, the merger comes into play.

GUIDANCE

Guidance going forward will be the key, and it is hard to contemplate what exactly XM will say. They will likely provide realistic yet conservative goals and targets across the board. The trick here is to be aggressive enough to keep the street satisfied. Look for sub guidance to be between 1,5 million and 1.7 million. It is also quite possible that some of the guidance we received in the past will not be given due to the merger.

Q & A

This will be a must hear event. Look for most questions to center around the merger, and 2007 performance rather than the 2006 results.

Key items investors should listen for are whether or XM will be CFBE in 2007, what kind of losses are expected, and where the legal items stand. These items will be in the spotlight from time to time as 2007 moves forward.

Labels: Q4 2006, xm conference call

2/25/2007 07:55:00 PM

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Merger Talk: Understanding The Analysts

I find it ironic that before the merger announcement, many analysts (I won't mention names) were saying that XM and Sirius should merge, highlighting the potential programming synergies and operating cost savings. Now that there is an executed agreement, those same analysts are saying that a merger will never get approval. Go figure...!

2/24/2007 08:07:00 AM

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Merger Talk: Barrons Comments

Single Satellite Would Lift Investors
Barrons, Feb 26

WALL STREET REACTED CAUTIOUSLY to the merger agreement last week between Sirius Satellite Radio and XM Satellite Radio, amid concerns about antitrust approval and fears that the deal amounts to a sign of weakness by the two money-losing rivals, whose shares trade for less than half their 2004 peaks.

Sirius stock rose just 4 cents, to 3.74, while XM gained $1.12, to 15.10. The larger gain in XM shares reflected Sirius' offer to pay a premium for a deal, which has been championed by Sirius CEO Mel Karmazin from almost the moment he arrived at the company back in 2004.
The market skepticism could provide a buying opportunity, because both Sirius and XM are apt to rally if federal regulators okay the deal. XM probably has more upside because it trades at a nearly $2-a-share discount to the current value of the Sirius offer of 4.6 shares of its stock for each XM share...read more: here

2/24/2007 07:55:00 AM

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What Cramer Said On MadMoney Tonight

Cramer's 'Mad Money' Recap: Two Specs to Examine
Page 3, Feb 23, www.thestreet.com

Mad Mail
In the show's "Mad Mail" segment, in response to a viewer who wrote in, Cramer said that he believes it's better to buy the stronger company, like Sirius Satellite Radio (SIRI - Cramer's Take - Stockpickr - Rating), rather than the weaker company, like XM Satellite Radio (XMSR - Cramer's Take - Stockpickr - Rating), in an anticompetitive merger, because whether or not the deal goes through, the former should go up...read more: here

2/23/2007 11:38:00 PM

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Satellite Radio TechWorld Sheds Light On XM's Repeater Inquiry

Friday, February 23, 2007, via Satellite Radio TechWorld
XM's Notice of Inquiry for Its Repeaters

Most of you by now have heard about XM's disclosure that it received a notice of inquiry (NOI) from the FCC. It should not be a surprise to our readers here. Ultimately it could result into a notice of apparent liability (NAL), which will result in a "forfeiture" of some magnitude.

The FCC has been handing out NAL's right and left the last few weeks. They have handed out NAL's every day this month, except one. A quick count shows 156 NAL's or other forfeitures this month alone, resulting in a weighted average of $4,700 for each incident. Most of these were for failure to file for renewal in a timely matter. The vast majority of the forfeitures were for $1,500 (73). The next most popular forfeiture was for $7,000 (47). Forfeitures were for as much as $25,000 (1) for the month. There were only 17 forfeitures above $7,000.

Since both XM and Sirius volunteered the information, one would expect the forfeitures to be minimum. We would guess a worse case of $1,500 per incident. The total amount would depend on whether the FCC considers the network of repeaters as a whole or individually. And then there are the 4 repeaters that XM continued to operate with authority. Quite possibly, the FCC could look unfavorably on this and hit them with the maximum penalties...read more: here

2/23/2007 05:04:00 PM

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Amtech Previews XMSR & SIRI Earnings

Amtech previews next week's XMSR & SIRI earnings
via www.briefing.com, Feb 23

Amtech notes that both satellite radio providers will report next week with XMSR on Monday and SIRI on Tuesday, both before the market open. With lower than expected subscriber numbers already reported by both companies, firm thinks the focus will be P&L trends and subscriber growth guidance. They expect lower losses for both companies as a result of lower subscriber additions. They say the general feeling is that the merger announcement the week before earnings reports is probably not a signal of improving business fundamentals and guidance is likely not great. Expectations for subscriber guidance have come down with SIRI missing Q4 by 300k and XMSR missing by 200k against earlier forecasts. Firm thinks slowing retail subscriber growth is expected to be offset in part by a pick-up in OEM business with the 2007 car model year, with another leg up in 2H with 2008 model introductions. They think consensus for 2007 is around 2.1 mln net new subscribers for SIRI and around 1.5 mln for XMSR. With the merger proposal, SIRI becomes the valuation driver for both stocks. Barring a material surprise in either direction, they believe the XMSR report is more likely a non-event and SIRI may have more stock relevance. They note the binary outcome on merger approval/rejection is however a more important event for the stocks than earnings or guidance from either company.

2/23/2007 09:11:00 AM

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New York Times: Satellite Radio is A Good Idea But Has Been A Bad Investment

High & Low Finance
Satellite Radio: A Good Idea, but a Bad Investment
By FLOYD NORRIS, Feb 23, The New York Times

It is the genius — or perhaps the great flaw — of the American capital system that really clever, but totally uneconomical, ideas can be financed by investors.
That process creates enterprises that may eventually be valuable, even if not to those who put in the original money. So it was with satellite radio, a onetime Wall Street darling that is again the subject of investor enthusiasm after the announcement of plans to merge the only two players in the American market: XM and Sirius.

Perhaps satellite radio will finally work out as an investment now. The hope is that the two companies can use the threat of financial failure to obtain regulatory approval for creation of a satellite radio monopoly....read more: here

2/23/2007 08:21:00 AM

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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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Merger Talk: It's Not Just the iPod...HD Radio Openly Admits That It's A (Free) Direct Competitor

I'm sure the congressional task force holding hearings on the SIRI-XM merger will see this HD Radio Press release and take it into consideration (I wonder why the NAB doesn't go after HD Radio).

Free HD Radio Offers Clear Alternative to Satellite Fees - and More Features
via PRWeb, Press Release Newswire, Feb 23

HD Radio offers stunningly clear reception and multiple channels on the same signal, which enables broadcasters to offer full album plays, in-depth interviews, showcase new artists and simultaneously provide digital data feeds for stock quotes, sports scores, weather and traffic.

...Prather says listeners addicted to satellite's clear digital sound and wide variety of programming alternatives have an ace in the hole - HD Radio.The "HD" in HD Radio, the brand name of iBiquity Digital Corporation, stands for Hybrid Digital, hailed by many as the most significant advancement in commercial radio since the introduction of FM radio half a century ago. With HD Radio, AM stations project the static-free clarity of conventional FM stations, and FM sound approximates CD quality. The clear digital sound of HD Radio is often compared to the incredibly clear images and sounds of HDTV. However, HD Radio has some other benefits that enable it to compete directly with satellite radio, chiefly technology that allows broadcasters to send multiple channels simultaneously on the same frequency. Using this capability, as more than 1,100 AM and FM radio stations in the United States - and nearly 50 in North Texas - already do, stations can simulcast separate channels of music and news without additional transmitters. This is changing significantly the way broadcasters do business...read more: here

2/23/2007 07:58:00 AM

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Congressional Task Force To Hold Hearings On Merger

US lawmakers to hold XM-Sirius merger hearing
WASHINGTON, Feb 21 (Reuters) -

A new Congressional antitrust task force will hold a hearing next week on the proposed merger of radio subscription companies, XM Satellite (XMSR.O: Quote, Profile , Research) and Sirius Satellite (SIRI.O: Quote, Profile , Research), House Judiciary Committee Chairman John Conyers said on Wednesday. Mel Karmazin, chief executive of Sirius, will testify at the Feb. 28 hearing, Conyers said in a statement.

Sirius's planned takeover of XM must be approved by the U.S. Justice Department and Federal Communications Commission who review mergers for their impact on competition and customer service. The two companies contend that the deal won't hurt consumers because satellite radio, which charges a subscription fee, faces competition from terrestrial radio, wireless music devices and podcasts....read more: here

2/22/2007 11:45:00 PM

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FCC Questions XM About Repeaters

The Associated Press February 22, 2007, 7:46PM EST
FCC questions XM about repeaters

The Federal Communications Commission is asking XM Satellite Radio Holdings Inc. for information on its terrestrial repeater network, the company said Thursday.
The repeaters supplement the satellite radio signal, ensuring that the service works even when direct line of sight to the satellite is obscured.
XM wants approval to continue running the network, but the characteristics of some repeaters differ from the data submitted to FCC when it originally approved the system, XM said in a Securities and Exchange Commission filing.
The Washington-based company has met with FCC staff about the matter and got an inquiry letter from the agency on Feb. 15, the filing said...read more: here

2/22/2007 11:40:00 PM

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The NAB Flip-Flops On Indecency

SATELLITE RADIO COMMENTARY
Money, not outrage, fuels anti-merger fight
BY GLENN GARVIN, Feb 22, The Miami Herald

Watch out for winged pigs, rivers flowing upstream, Hillary Clinton kissing Rush Limbaugh and Britney Spears putting on underwear. Anything is possible now that the National Association of Broadcasters has discovered indecency on the airwaves.
Conveniently, it's somebody else's airwaves -- those inhabited by the two satellite radio companies that compete with the NAB's broadcast clients. The NAB has been shocked, shocked, to learn that the potty-mouth Howard Stern is talking about sex, poop and body parts on satellite radio, and says that's a good enough reason for the government to block the merger of XM and Sirius....read more: here

2/22/2007 11:26:00 PM

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SSG Introduces SATCOS

February 21, 2007

We are pleased to announce the launch of Satellite Consumer Opinion Study - SATCOS

SATCOS was soft launched about 1 month ago, and today we are pleased to unveil SATCOS to the readers of SSG and the satellite radio consumer community. We feel that the merger announcement makes it more important than ever for an assessment of consumer opinions. Currently there are seven surveys on SATCOS, and we encourage you to participate in all of them. Your answers are kept private by Killer Survey, and SATCOS nor SSG receives any information other than the results, which are fully available to the public.

SATCOS Survey #1 - Demographics
SATCOS Survey #2 - OEM
SATCOS Survey #3 - RIAA vs. XM
SATCOS Survey #4 - Content
SATCOS Survey #5 - I-Pod vs. Satellite
SATCOS Survey#6 - Retailers
SATCOS Survey #7 - Merger

SATCOS Is A Grass Roots Campaign To Shed Light The Opinions Of Satellite Radio Consumers By Gathering and Publishing Information Relating To The Satellite Radio Sector.

The purpose of SATCOS is two fold. First and foremost, it has been implemented to gather consumer opinions for the purpose of gathering thought and sentiment of consumers with regards to various subject matter. SATCOS will publish fully public surveys each Monday. these surveys will range in subject matter, and are geared towards letting anyone participate and better understand satellite radio. Your opinions count and matter. Participation in SATCOS surveys lets many people know how satellite radio consumers as a group feel. It expresses consumer desires, and can help to create a better listening experience on satellite radio. Readers are encouraged to submit subjects for survey consideration.

The second aspect of SATCOS is to utilize commissioned surveys that pay you, the satellite radio consumer, for your opinions. satellite radio is a new medium, and as yet, many traditional businesses and advertisers require a baseline of data to better understand the satellite radio consumer. By example, an on line retailer may want to know where their customers are coming from and how their customers feel about their on line shopping experience. Was the retailers site easy to navigate? Were the prices good? Were the product photos and descriptions good? was The shipping fast? That retailer can commission a survey for their customers through SATCOS. Another example is an advertiser wanting to better understand what their target audience is listening to. they can commission a survey. SATCOS is creating a panel of satellite radio consumers, and that panel will receive compensation for each commissioned survey they participate in.

Please feel free to visit the SACOS site for more information.

Labels: satcos, satellite radio, sirius, xm

2/21/2007 10:53:00 PM

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Merger Announced - What's Next

February 21, 2007

Now that the merger has been announced, many investors are likely looking for the bounce in the stock price. As yet, it has not been very substantial. The question is whether or not it will improve as time passes.

First things First

We have the quarterly reports for Q4 2006 due next week, and that is reason enough to hold excitement in check.....at least for the moment. Investors know the synergies of a possible merger, but what is unknown is how long before these synergies are realized, and what the performance of 2006 was. currently investors are awaiting guidance from these companies. this guidance will allow the street to determine how much value is in these companies, and where they stand financially as individual companies. It is only with a clearer understanding of this that the street can begin to assess the premium a merger would bring.

Thus, current guidance is needed

The Naysayers Are Getting Their Two Cents In

As expected, there exists a faction of Naysayers to a merger. Some believe it will not happen, others argue that it shouldn't. These voices will be heard the loudest in the coming days. Thankfully, it is not loud opinions that matter here. It is reasonable thought and the definition of the marketplace that will determine how the merger goes forward. Sure, the street will hedge their merger bets, but as time passes, and things begin to become more clear, people will feel more solid in which way they feel this will go.

Don't Look For A Lot Until Guidance is Clarified and Established

Traders make money off of fast action and news, or the sentiment while news is not yet delivered. Currently there are still a lot of questions in the air. There will be a lot said in the respective conference calls, and investors will be hanging on the the calls, as well as the question and answer sessions. Once these calls are complete, the concentration will shift back to the merger.

Consider The Timing of Events

1. The companies announce a merger.

2. One week later they have their respective quarterly reports.

3. One week later Karmazin will speak to a Congressional Committee.

4. The merger will go before the DOJ and FCC.

While all of this is happening, there will be another auto show, and there will be many studies and reports related to the subject. This merger is going to be on the forefront of the street for quite some time. If it begins to gain steam, the stock prices will begin to react.

Labels: merger, sirius, xm

2/21/2007 09:48:00 PM

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Terrestrial Radio: How They Define Their Own Competitive Landscape May Help Satellite Radio's Merger Efforts

Why Terrestrial Radio can't fight Satellite Radio's definition of a competitive market
via www.orbitcast.com, Feb.22

There's something I would like to briefly highlight from a previous post, that I think deserves a post of it's own. And that is that CBS Radio (and other broadcasters) actually have already defined the competitive landscape in their SEC filings.

Here's a snippet from CBS's 10-K (with emphasis added):

Radio Competition.
The Company's radio stations directly compete within their respective markets for audience, advertising revenues and programming with other radio stations including those owned by other group owners such as ABC Radio, Clear Channel Communications, Cox Radio, Emmis Communications, Entercom and Radio One. The Company's radio stations also compete with other media, such as broadcast, cable and DTH satellite television, radio, newspapers, magazines, the Internet and direct mail.

The radio industry is also subject to competition from two satellite-delivered audio programming services, Sirius Satellite Radio and XM Satellite Radio, each providing over 100 channels of pay digital audio services. Sirius and XM sell advertising time on some of their channels and compete with the radio industry for programming..read more: here

2/21/2007 05:55:00 PM

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Moody's On Merger: Revenue & Cost Synergies Could Provide Upward Momentum To Its Rating

The following is a press release from Moody's Investors Service:

Moody's Changes Xm's Outlook To Developing From Stable:

New York, February 21, 2007 -- Moody's Investors Service affirmed the existing debt ratings of XM Satellite Radio Holdings, Inc. ("XM") and its subsidiary XM Satellite Radio, Inc. and changed the outlook to developing from stable in connection with the company's February 19, 2007 announcement that XM and SIRIUS Satellite Radio, Inc. ("SIRIUS") have entered into a definitive merger agreement. The proposed transaction will combine the two companies in a tax-free, all-stock merger of equals with a combined enterprise value of $13 billion, including net debt of approximately $1.6 billion. Under the agreement, XM shareholders will receive a fixed exchange ratio of 4.6 shares of SIRIUS common stock for each share of XM they own. The transaction, which is subject to shareholder and regulatory approvals, is expected to close by the end of 2007, pending regulatory approval.

The developing outlook reflects Moody's view that over the intermediate term, these potential revenue and cost synergies could impact the combined company's free cash flow and other credit metrics and provide upward momentum to its rating. However, the impact on the credit metrics is dependent on the size and timing of these synergies as well as costs associated with realizing these synergies including those related to making the two companies' technological
architectures inter-operable. Given the uncertain nature of the impact of the cost synergies and enhanced operating leverage on the credit metrics including free cash flow, and the regulatory challenges to completing the merger, Moody's maintains XM's Caa1 corporate family rating at this time.

Moody's Changes Sirius' Outlook To Developing From Stable

New York, February 21, 2007 -- Moody's Investors Service affirmed the existing debt ratings of SIRIUS Satellite Radio, Inc. ("SIRIUS") and changed the outlook to developing from stable in connection with the company's February 19, 2007 announcement that SIRIUS and XM Satellite Radio Holdings, Inc. ("XM") have entered into a definitive merger agreement. The proposed transaction will combine the two companies in a tax-free, all-stock merger of equals with a
combined enterprise value of $13 billion, including net debt of approximately $1.6 billion. Under the agreement, XM shareholders will receive a fixed exchange ratio of 4.6 shares of SIRIUS common stock for each share of XM they own. The transaction, which is subject to shareholder and regulatory approvals, is expected to close by the end of 2007, pending regulatory approval.

The developing outlook reflects Moody's view that over the intermediate term, these potential revenue and cost synergies could impact the combined company's free cash flow and other credit metrics and provide upward momentum to its rating. However, the impact on the credit metrics is dependent on the size and timing of these synergies as well as costs associated with realizing these synergies including those related to making the two companies' technological
architectures inter-operable. Given the uncertain nature of the impact of the cost synergies and enhanced operating leverage on the credit metrics including free cash flow, and the regulatory challenges to completing the merger, Moody's maintains Sirius' Caa1 corporate family rating at this time.

Labels: moodys, sirius, xm

2/21/2007 04:48:00 PM

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Cramer Turns Positive On Satellite Radio In Wake Of Merger Announcement

Jim Cramer's Stop Trading! Buy Sirius
By TheStreet.com Staff, 2/21/2007 2:53 PM EST

The satellite-radio stocks are a screaming buy, Jim Cramer said Wednesday on CNBC's Stop Trading! segment.
Cramer said he prefers Sirius (SIRI - Cramer's Take - Stockpickr - Rating), but he believes XM (XMSR - Cramer's Take - Stockpickr - Rating) is also worth owning in the wake of Monday's $4.57 billion merger plan.

Cramer said he expects the Republican-controlled Federal Communications Commission to hold a "show trial" approving the deal, which Cramer said "would not pass muster" were the Democrats in control.

Cramer said a merger will allow the combined company to raise prices and to stop wasting money by bidding against each other for on-air talent. "I just think it's great," he said...read more: here

Labels: cramer, siri, xm

2/21/2007 03:57:00 PM

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NY Times: Antitrust Shift May Aid Merger

Many experts agree that the EchoStar-DirecTV deal would have a good chance of being approved in today's environment. There have been alot of changes in the past four years...cable is not their only competitior, there is the internet, and the Telcos. This analogy could be made for satellite radio, for which the consumer has an even broader range of audio choices.

Shift on Antitrust Issues May Aid Sirius-XM Deal
The New York Times, Feb 21, By ANDREW ROSS SORKIN

Mel Karmazin, the chief executive of , made a lot of phone calls seeking advice before he entered into a merger deal with on Monday. Maybe he should have called Charles W. Ergen, the founder and chairman of EchoStar Communications. Mr. Ergen could have given Mr. Karmazin an earful about his failed effort to merge EchoStar with DirecTV four years ago, a deal that seems eerily similar to the one Sirius and XM have proposed. Will the government see things differently this time? Michael K. Powell, the former chairman of the Federal Communications Commission who blocked the EchoStar-DirecTV deal, is not so sure. “I do think it could get through, but I don’t think it’s going to be an easy one,” he said. “It’s going to be incumbent on the companies to demonstrate that the analysis in EchoStar-DirecTV is different.”...read more: here

Labels: merger, new york times, satellite tv, siri, xm

2/21/2007 06:29:00 AM

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Meger For Consumers

February 20, 2007

There seems to be a group of people who are dead set against a merger, and feel that such a deal would be bad for consumers. While everyone is entitled to an opinion, there are many ways consumers can express their desires relative to a merged company.

There is no denying that merged satellite radio companies present a huge potential that can be very beneficial to consumers. Sirius and XM outlined several of the benefits that could be realized from a consumer perspective in their announcement.

Perhaps a better track than an outright opposition to the merger is to concentrate efforts on what it is you desire as a consumer, and letting that opinion be known to these companies as well as governmental agencies.

The problem with outlining opposition is that the outline is all theoretical. By point of fact, it is unknown whether or not the merger would be consumer friendly.

Is it not better to outline and phrase comments such as:

"I would see benefit in a merger if I were sure that the pricing structure would be fair to consumers"

"I would see benefit in a merger if there were free and dedicated channels for public safety"

" I would see benefit in a merger if i was assured that my current equipment would work, or that new equipment was made available in an affordable way (exchange old for new and get a service discount, etc.)"

"I did not like the exclusive deals with cars and feel that the consumer having a choice is better"

"I see benefit in a merger because bandwidth can be better utilized to not only improve sound quality, but also provide better and more effective additional services."

This form of communication is much more positive and influential than the negative connotation set forth by simply opposing the merger based on a theory that it is not good.

All to often people take an approach that does not help or hinder the process, but simply muddies the waters. Consumers should make a concerted effort to articulate their opinions in such a way that best describes their desires, while at the same time allowing the companies to move forward with their plans.

The fact of the matter is that a merged company has the potential to offer consumer benefits that two separate companies will never be able to offer, and isn't it better to try to maximize your benefits as a consumer?

Yes, there are people, and even organizations that oppose the merger. To those i would suggest a simple exercise that may give clarity to your approach. Make a list of potential benefits of a merged company. Make a second list with what you feel are the negatives of a merged company. Now compare the lists, and take a track that limits the negatives and pushes for the positives.

What we know as of today is that these companies are what they are. This is the service you get. Now look at what you could get with a merger and push for those things to happen.

Labels: merger, sirius, xm

2/20/2007 09:53:00 PM

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Goldman Sachs On Merger

February 20, 2007

Report Excerpts:

XM and Sirius merger announcement arrives…now what?

News XM Satellite Radio and Sirius Satellite Radio announced a definitive agreement to combine in a proposed $13 billion merger of equals. The deal is structured to be tax-free and all-stock that the companies believe can close by year-end 2007.

Analysis

Last week, our detailed report “Conundrum squared: Why XM and Sirius should wait” (2/11/07) walked through our thoughts on a potential merger. The key question now pertains
to approval chances and consequent share price reactions. In our view, merging platforms could
deliver significant operational, financial, and strategic benefits, likely exceeding $4 billion, though mostly years away. That said, we continue to believe that that the merger is unlikely to pass muster with the FCC, DOJ, and investors, assuming current terms. Finally, we caution that
some investors might view the emergence of the merger proposal as a lack of confidence in the
fundamental business outlook as stand-alone competitors.

Implications

The 18% EV discount XMSR trades at relative to SIRI should be cut by 2/3 upon the open.
Assuming SIRI shares trade toward $4 implies $18.40 per XMSR share, less an estimated net 5%- 6% arb discount (10%-12% gross spread less rebate) yields XMSR shares around $17.40, or a 24% increase from Friday's close. This is close to the almost 22% premium assigned to XMSR shares via the proposed 4.6:1 fixed-exchange ratio. We think XM's shareholders are likely to approve the transaction, given the likely lower valuation in the absence of a deal. That said, we question whether the fixed-exchange ratio represents the best possible deal should Sirius' retail sub growth falter and reported churn begin to reflect XM's all-in churn figure in 2007.

Risks

Our probability-weighted, DCF-based 12-month price targets are now $15.30 for XM (Neutral), up from $15, and $2.75 for Sirius (Sell), implying an improved exchange ratio. Risks include subscriber trends, execution, or merger approvals.

Labels: goldman sachs, merger, sirius, xm

2/20/2007 09:39:00 PM

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Merrill Lynch On Merger

February 20, 2007

Report Excerpt:

XM and SIRI announce merger of equals

XMSR and SIRI announced an agreement to merge in a tax free, all stock merger
of equals (50% owned by SIRI shareholders and 50% XM shareholders) with a
combined enterprise value of $13bb (including $1.6mm debt). XM shareholders
will receive 4.6 shares of SIRIUS common stock for each share of XM. Mel
Karmazin (CEO of SIRI) will be CEO and Gary Parsons (Chairman of XMSR) will
be the Chairman of the merged company. The transaction is expected to close,
pending shareholder and regulatory approval, during the next 6-9 months.

Change XMSR to “No Rating”

Given SIRI will be the surviving entity in the announced merger transaction and
XMSR shares will now trade based on its exchange ratio to Sirius, we are
changing our rating on XMSR to “No Rating” from Neutral. Investors should no
longer rely on our previous estimates or rating. Please refer to our SIRI note “And
then there was one” published on February 20, 2007 for details regarding the
merger and estimated cost synergies

Labels: merger, merrill lynch, sirius, xm

2/20/2007 09:32:00 PM

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Morgan Joseph On Merger

February 20, 2007

Report Excerpts:

XM's Machiavellian Play?
Investment Highlights:

Merger likely to be considered but we doubt it will pass. Yesterday, XM and Sirius announced they had agreed to merge in an equal transaction that would give shareholders of each company 50% ownership of the combined entity. Under the terms of the deal, XM shareholders would receive 4.6 shares of SIRI stock for each one of their shares, for a total value of approximately $17/share (or a 21.6% premium to XM's closing price of $13.98 last Friday). We maintain our
view that even if the deal is considered, significant regulatory obstacles will ultimately prevent approval. We reiterate our Hold ratings on both XM and Sirius.

Deal logistics favor cost synergies. Under the proposal, Mel Karmazin would retain his position as CEO while Gary Parsons would become Chairman. The companies plan to use both satellite portfolios and create a radio product capable of accessing the combined content range. While we believe the merger would lead to tremendous cost savingsand improve the combined company's pricing power as the only satellite radio player in the industry, we note the anti-trust concerns related to potential price increases. While the companies maintain they do not have pricing flexibility, we highlight the 30% price increases XM successfully implemented two years ago, which did not prevent solid net adds or lead to increases in churn.

Timing of events. The companies plan to file the merger agreement ina form 8K this Friday. Once filed, there is a 20-day window during which a Hart-Scott-Rodino must be submitted to the Department of Justice (DOJ), which will trigger debate over approval from the anti-trust standpoint. If approved, the merger will gain anti-trust clearance from the DOJ; from there, the companies have 25 days to submit an application to the FCC (Federal Communications
Commission), which will ultimately determine whether or not the anti-merger provision will be amended. In the end, merger approval will depend on approval from the five FCC Commissioners.

XM's Machiavellian play? If the deal does not gain approval, Sirius must pay a $175mm breakup fee to XM. We note the potential for the fee payment to injure Sirius. In addition, it could hamper the company's operating results in the near-term, given potential management
distraction and related lobbying fees.

This last excerpt seems to not allign with the statements made at the joint conference today. the $175 million "break-up fee" applies to both boards. If either board votes down a merger that company would owe the other $175 million.

Labels: merger, morgan joseph, sirius, xm

2/20/2007 09:25:00 PM

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Stanford Group on Merger

February 20, 2007

Report excerpts:

SIRI: Serious regulatory battle ahead.

• We are adjusting our target on Buy rated Sirius SatelliteRadio target back to $5 from $6 because the estimated merger synergies of $1.50 per share are further off and will be harder to uncover than we realized.

• While a satellite radio merger makes tremendous sense given that both companies have invested heavily in content in an effort to tap into the consumer mass market while competing in an increasingly competitive media marketplace, it may take nine months hear from regulators and some time beyond that to start unlocking merger synergies.

• The merger will face significant regulatory scrutiny from the Federal Communications Commission and the Department of Justice. Stanford policy analyst Paul Gallant believes there is a 60% chance the DOJ will sue to block the merger. The transaction is slated to close by year end.

• Analysts have estimated the present value of merger synergies stands between $3-7 billion. The midpoint represents roughly $1.50 per SIRI share of value creation to the combined enterprise. The combine company will control roughly 14 million subscribers producing $2 billion of annual revenue.

• The shares of Sirius had a much more muted reaction to the merger announcement this morning than we anticipated perhaps because the realization of the synergies is so far off and because of the uncertainty of getting regulatory approval.

• Sirius trades at 7x estimated 2007 revenue of almost $1 billion and $800 per our 2007 subscriber estimate of 8.7 million. Our price target returns to $5 to reflect a more serious discounting of the merger and its potential synergies. We rate Sirius Satellite Radio a Buy.

Labels: merger, sirius, stanford group, xm

2/20/2007 09:20:00 PM

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XM+SIRI: S and P Likes The Deal

S&P Upgrades XM Satellite Radio to Hold
Analyst Tuna Amobi notes the company's deal with Sirius. From Standard and Poor's Equity Research
XM Satellite Radio (XMSR): Upgrades to 3 STARS (hold) from 2 STARS (sell), Analyst: Tuna Amobi

As recently speculated, XM Satellite Radio and Sirius (SIRI) agree to a $13 billion merger of the rival satellite radio providers. Each XM share would get 4.6 shares of Sirius, whose CEO Karmazin would lead new entity, with XM Chairman Parsons keeping his title. While the deal is billed as a merger of equals, we see an effective takeover of XM by Sirius. But with this duopoly merger likely perceived by many in Washington as anti-competitive, we see little worse than 50/50 odds of closing by 2007 end, as expected. Still, we raise our target price by $7 to $20 on the fixed exchange ratio.

S and P Places Sirius Satellite Radio Inc. 'CCC' Rtg On Watch Positive>SIRI The following is a press release from Standard & Poor's:

NEW YORK (Standard and Poor's) Feb. 20, 2007--Standard and Poor's Ratings Services
said today it placed all its ratings, including the 'CCC' corporate credit
rating, on New York City-based Sirius Satellite Radio Inc. on CreditWatch with
positive implications, following the company's definitive agreement to an all-
stock "merger of equals" with XM Satellite Radio Holdings Inc. (CCC+/Watch
Developing/--). Under the terms of the agreement, Sirius shareholders will own
50% of the combined company and XM shareholders will receive 4.6 shares of
Sirius common stock for each share of XM they own. As of Sept. 30, 2006, the
company had approximately $1.08 billion in outstanding debt.

"If the transaction is completed as proposed, without the incurrence of
additional debt," said Standard & Poor's credit analyst Michael Altberg, "we
would likely raise the ratings as a result of the combined company's stronger
business profile and quicker path to positive free cash flow."

Labels: merger, siri, standard and poors, xm

2/20/2007 05:18:00 PM

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Give Credit Where Credit Is Due...Jim Cramer

Jim Cramer was one of the first to openly discuss a Sirius+XM merger. At first, many thought he was way off base, citing technical incompatibility, FCC approval, and management integration, but then several analysts began to write about the possibilities, and here we are today, with an executed merger agreement.

2/20/2007 05:09:00 PM

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Orbitcast Did A Great Job Of Blogging The XM+Sirius Merger Conference Call

Live Blogging the Sirius + XM Merger Conference Call
via www.orbitcast.com, Feb 20th

(I'm live blogging the Sirius and XM Merger Conference Call for those of you who can't listen in. Just keep refreshing the page because this post will be updated in real-time.)

Intros begin! Mel Karmazin, and Gary Parsons are on board for the call.
Mel is kicking off the call.

DOH! There seems to be some technical issues... back into the holding pattern.
Ok we're back.
Mel Karmazin begins...
"We're all very excited about this announcement and the many benefits"..read more: here

2/20/2007 05:02:00 PM

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Analyst Call Of The Week: Robert Peck Of Bear Stearns

Congratulations, Robert Peck, for your timely "rekindling" of "merger chatter"

Bear Stearns Rekindles XM/Sirius Merger Chatter
Posted on Feb 16th, 2007 with stocks: SIRI, XMSR...read more: here

Labels: bear stearns, merger, siri, xm

2/20/2007 07:26:00 AM

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Satellite Radio Merger Survey

February 19, 2007

We posted this survey 1 month ago, and it seems appropriate to post it again.

Labels: merger, sirius, xm

2/19/2007 11:13:00 PM

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Letter From Mel Karmazin

February 19, 2007

The following is a letter from Mel Karmazin to Sirius subscribers. People should pay particular attention to the fact that these companies will continue to be independent of each other prior to acceptance of the merger. This means separate advertising, etc. The regulations regarding the merger process are very specific, and part of those regulations dictate that until approved, these companies conduct business as usual.

February 19, 2007

To: SIRIUS Subscribers

Today is a very exciting day for SIRIUS customers. As you may have heard, SIRIUS Satellite Radio and XM Satellite Radio are merging to form the nation's premier audio entertainment provider.

This combination of our two offerings will benefit you - our loyal listeners. As a single company, we'll provide superior programming to you every day with the best of both SIRIUS and XM. Currently, XM and SIRIUS broadcast a wide range of commercial-free music channels, exclusive sports coverage, news, talk, and entertainment programming. Howard Stern. Oprah and Friends. The NFL. MLB. NBA. ESPN. CNBC. Fox News. Additionally, the combined company will be able to improve existing services such as real-time traffic information and rear-seat video as well as introduce new ones.

After shareholder and regulatory approvals, we anticipate that the combination will be finalized by the end of 2007. Until then, both companies will continue to operate independently. We will continue to provide you with the uninterrupted service - as well as the outstanding customer support - that you have come to expect and enjoy from SIRIUS. We do not anticipate any changes in your service during the merger process, however, please call our customer care team on 1- 888-539-7474 should you have any questions.

We look forward to the many benefits this combination will offer and continuing to make your listening experience an enjoyable one - offering more of the Very Best Radio on Radio.

Stay tuned,

Mel Karmazin, CEO

Labels: mel karmazin, merger, sirius, xm

2/19/2007 10:55:00 PM

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NAB Against Merger - No Surprise

February 19, 2007

The response by the NAB comes as no surprise. For the past year - ever since they saw an impending threat from satellite radio - the NAB has taken many steps to work against consumers getting the superior content that is offered by satellite radio.

Dennis Wharton of the NAB stated:

"Given the government's history of opposing monopolies in all forms, NAB would be shocked if federal regulators permitted a merger of XM and Sirius. It bears mentioning that regulators summarily rejected a similar monopoly merger of the nation's only two satellite television companies -- DirecTV and DISH Network -- just a few years back."

While Wharton is correct that the government opposes monopolies, he fails to consider the environment that exists in the modern marketplace. Indeed, the NAB does see satellite radio as competition, as well as I-Pods, internet radio, and many other services offering audio content. Thus, would a merger of Sirius and XM present a monopoly? It appears that in this instance the NAB is looking at a very narrow definition of the marketplace. Would this be a case of selective definitions to suit a specific debate? How do NAB members argue about repeaters, traffic programming, weather programming, etc. in one instance because of competitive threats, but then go on to argue that a merger would create a monopoly?

Wharton goes on to state:

"When the FCC authorized satellite radio, it specifically found that the public would be served best by two competitive nationwide systems. Now, with their stock prices at rock bottom and their business model in disarray because of profligate spending practices, they seek a government bail-out to avoid competing in the marketplace."

What Wharton misses here is that the public interest could very well be better served by a satellite radio merger. Imagine a tiered system that lets consumers identify and buy the content they want at a financial level they are comfortable with. Further his statement about stock prices, spending and business models seem very contrite. yes, satellite radio has spent a lot of dollars on content. They have a business model that deals with subscription services rather than relying on 20 minutes worth of advertising every hour. Was it not the NAB that scoffed at the satellite radio concept only 3 years ago? How is it that now the NAB suddenly sees satellite radio as a threat. The fact is that satellite radio has a business model that works, but does rely on a certain amount of subscriptions to sustain itself. That subscriber level is fast approaching. Mr. Wharton calls this a "request for a government bail-out." The fact of the matter is that this is not a bail out, and the business model is not in disarray. Both Sirius and XM announced narrower losses in Q3. Sirius announced CFBE for Q4. XM announced Operating Cash Flow positive in Q4. Analysts are projecting narrower losses going forward, and this business model is now in the beginning stages of coming to fruition. The merger simply accelerates that process, and that is what the NAB seems to fear. What is happening here is the NAB telling the nation that they fear satellite radio, and they are scared to adapt their business model to a modern world. The NAB has had a stagnant business model for decades, and for whatever reason, they would rather someone else's progress than adapt to the changes.

Mr. Wharton, your argument here is littered with your own agenda. You are not trying to think in the best interest of the consumer, and your veiled attempt to portray yourself in that manner speaks loud and clear about what you think of the American population. Your stance against the merger is solely tied to your own business. If your true concern rested with the consumer we would not be seeing massive payola investigations against many in your membership. Perhaps your efforts should focus on your own methods prior to worrying about other things.

This statement by Mr. Wharton is very telling:

"In coming weeks, policymakers will have to weigh whether an industry that makes Howard Stern its poster child should be rewarded with a monopoly platform for offensive programming. We’re hopeful that this anti-consumer proposal will be rejected."

Mr. Wharton......with all due respect......You are now making an ass out of yourself. Howard stern spent over 20 years on terrestrial radio airwaves for your members!!!! Further, Howard stern is but one piece of content. Additionally, he makes up less than 1% of the channels available on Sirius. Your broad characterization of "offensive" is relative. There are many who consider the advertising on your airwaves offensive. Liberals consider conservative programming offensive, Conservatives feel the same about liberal programming. the Fact of the matter is that satellite radio offers more programming of various slants in ANY MARKET than the members of the NAB could ever hope to accomplish. Additionally, your characterization of a merger as anti-consumer is at this point unfounded. Did the NAB fight hard against Clear Channel taking control of massive share in markets? Was that anti-consumer? Do you not recognize that the merger could be even more consumer friendly than the situation that exists today? Are people so programmed for disappointment that they now automatically assign the most negative thoughts to anything new and different? Is it beyond your ability to consider that consumers could benefit?

Labels: consumer, merger, nab, payola, sirius, xm

2/19/2007 08:30:00 PM

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NAB Chimes in Against the Merger - Cites Dish

FOR IMMEDIATE RELEASE	CONTACT
February 19, 2007	Dennis Wharton 202-429-5350

NAB STATEMENT IN RESPONSE
TO SIRIUS/XM PROPOSED MERGER

WASHINGTON, DC - The following statement can be attributed to NAB Executive Vice President Dennis Wharton.

"Given the government's history of opposing monopolies in all forms, NAB would be shocked if federal regulators permitted a merger of XM and Sirius. It bears mentioning that regulators summarily rejected a similar monopoly merger of the nation's only two satellite television companies -- DirecTV and DISH Network -- just a few years back.

"When the FCC authorized satellite radio, it specifically found that the public would be served best by two competitive nationwide systems. Now, with their stock prices at rock bottom and their business model in disarray because of profligate spending practices, they seek a government bail-out to avoid competing in the marketplace.

"In coming weeks, policymakers will have to weigh whether an industry that makes Howard Stern its poster child should be rewarded with a monopoly platform for offensive programming. We’re hopeful that this anti-consumer proposal will be rejected."

About NAB
The National Association of Broadcasters is a trade association that advocates on behalf of more than 8,300 free, local radio and television stations and also broadcast networks before Congress, the Federal Communications Commission and the Courts. Information about NAB can be found at www.nab.org.

###

Link (via NAB) (through Orbitcast).

Labels: direct tv, dish network, merger, nab, sirius, stern, xm

2/19/2007 06:39:00 PM

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Interesting Merger Issues

February 18, 2007

There have been some that have been critical of SSG for covering the merger subject. They seemed to feel that there was no possible way that these companies would ever get together, and further, that a deal would never be approved.

SSG has covered the subject extensively over the past year, and has always stated that it was the responsibility of these companies to at least consider a merger given the synergies that could be realized.

When news went around the street that FCC Chairman Martin spoke against a merger, we cautioned our readers that Martin could not make such comments, and that likely what he stated was taken out of context. We informed SSG readers that Martin would not be able to "pre-judge" such an issue, and that his comments would need to be very limited until such a time the issue was brought before him and the committee. We also advised readers that the Department of Justice would be the likely arm of the government to determine whether or not a merger would fall within the laws, and that the key element in that determination would be the definition of the market and competition.

Sirius and XM have obviously been working on this issue for quite some time. Both companies would have done a lot of research into governmental issues as well as financial issues. What is obvious here is that these companies felt strongly enough about possible approval that they have taken this step.

Now, I feel compelled to address a key issue that investors will be sure to see over the next several months. investors will likely see many people insinuate that this is purely a move to keep the stock price up, and that these companies have no intention on actually merging. For those that think this way, consider this......

The terms of a merger are all worked out prior to any announcement, and these terms are cast in stone. Once an agreement is reached, the companies seek out approval. if the merger is approved, then the deal happens as it has already been written. Does anyone really think that these companies would proceed with this with an actual intent for failure, but rely on the government, an outside entity, to quash the deal? There is far to much at stake for such a risk.

This deal is done, and now will take its natural progression. Interestingly, on the XM side of the house, there are very few shareholders that can make this determination on behalf of the entire group. Ten institutions hold over half of the stock. For Sirius shareholders, it is the retail investor that holds the cards.

Likely investors in both equities will be watching the market closely tomorrow, and the press will be seeking comment from the companies, analysts, government agencies, etc. on a side note, I would also look for some sort of settlement regarding the XM and RIAA suit in relative short order.

2/19/2007 03:45:00 PM

SSG Has Merged. You Can Read All Of The Latest SSG Content By Clicking Here



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SSG is not a Financial Advisor. Read Disclosure: HERE

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Merger_On

SIRIUS and XM to Combine in $13 Billion Merger of Equals
Monday February 19, 2:47 pm ET
Provides Consumers with Enhanced Content, Greater Choices and Accelerated Technological Innovation
Enables Satellite Radio to Better Compete in Rapidly Evolving Audio Entertainment Industry
Extraordinary Value Creation for Shareholders
Mel Karmazin to Serve as Chief Executive Officer and Gary Parsons to Serve as Chairman of Combined Company

WASHINGTON and NEW YORK, Feb. 19 /PRNewswire-FirstCall/ -- XM Satellite Radio (Nasdaq: XMSR - News) and SIRIUS Satellite Radio (Nasdaq: SIRI - News) today announced that they have entered into a definitive agreement, under which the companies will be combined in a tax-free, all-stock merger of equals with a combined enterprise value of approximately $13 billion, which includes net debt of approximately $1.6 billion.

ADVERTISEMENT
Under the terms of the agreement, XM shareholders will receive a fixed exchange ratio of 4.6 shares of SIRIUS common stock for each share of XM they own. XM and SIRIUS shareholders will each own approximately 50 percent of the combined company.

Mel Karmazin, currently Chief Executive Officer of SIRIUS, will become Chief Executive Officer of the combined company and Gary Parsons, currently Chairman of XM, will become Chairman of the combined company. The new company's board of directors will consist of 12 directors, including Messrs. Karmazin and Parsons, four independent members designated by each company, as well as one representative from each of General Motors and American Honda. Hugh Panero, the Chief Executive Officer of XM, will continue in his current role until the anticipated close of the merger.

The combined company will benefit from a highly experienced management team from both companies with extensive industry knowledge in radio, media, consumer electronics, OEM engineering and technology. Further management appointments will be announced prior to closing. The companies will continue to operate independently until the transaction is completed and will work together to determine the combined company's corporate name and headquarters location prior to closing.

The combination creates a nationwide audio entertainment provider with combined 2006 revenues of approximately $1.5 billion based on analysts' consensus estimates. Today the companies have approximately 14 million combined subscribers. Together, SIRIUS and XM will create a stronger platform for future innovation within the audio entertainment industry and will provide significant benefits to all constituencies, including:

* Greater Programming and Content Choices -- The combined company is
committed to consumer choice, including offering consumers the ability
to pick and choose the channels and content they want on a more a la
carte basis. The combined company will also provide consumers with a
broader selection of content, including a wide range of commercial-free
music channels, exclusive and non-exclusive sports coverage, news,
talk, and entertainment programming. Together, XM and SIRIUS will be
able to improve on products such as real-time traffic and rear-seat
video and introduce new ones such as advanced data services including
enhanced traffic, weather and infotainment offerings.

* Accelerated Technological Innovation -- The merger will enable the
combined company to develop and introduce a wider range of lower cost,
easy-to-use, and multi-functional devices through efficiencies in chip
set and radio design and procurement. Such innovation is essential to
remaining competitive in the consumer electronics-driven world of audio
entertainment.

* Benefits to OEM and Retail Partners -- The combined company will offer
automakers and retailers the opportunity to provide a broader content
offering to their customers. Consumer electronics retailers, including
Best Buy, Circuit City, RadioShack, Wal-Mart and others, will benefit
from enhanced product offerings that should allow satellite radio to
compete more effectively.

* Enhanced Financial Performance -- This transaction will enhance the
long-term financial success of satellite radio by allowing the combined
company to better manage its costs through sales and marketing and
subscriber acquisition efficiencies, satellite fleet synergies, combined
R&D and other benefits from economies of scale. Wall Street equity
analysts have published estimates of the present value of cost synergies
ranging from $3 billion to $7 billion.

* More Competitive Audio Entertainment Provider -- The combination of an
enhanced programming lineup with improved technology, distribution and
financials will better position satellite radio to compete for
consumers' attention and entertainment dollars against a host of
products and services in the highly competitive and rapidly evolving
audio entertainment marketplace. In addition to existing competition
from free "over-the-air" AM and FM radio as well as iPods and mobile
phone streaming, satellite radio will face new challenges from the rapid
growth of HD Radio, Internet radio and next generation wireless
technologies.

"We are excited for the many opportunities that an XM and SIRIUS combination will provide consumers," said Gary Parsons, Chairman of XM Satellite Radio and Hugh Panero, CEO of XM Satellite Radio, in a joint statement. "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."

"This combination is the next logical step in the evolution of audio entertainment," said Mel Karmazin, CEO of SIRIUS Satellite Radio. "Together, our best-in-class management team and programming content will create unprecedented choice for consumers, while creating long-term value for shareholders of both companies. The combined company will be positioned to capitalize on SIRIUS and XM's complementary distribution and licensing agreements to enhance availability of satellite radios, offer expanded content to subscribers, drive increased advertising revenue and reduce expenses. Each of our companies has a strong commitment to providing listeners the broadest range of music, news, sports and entertainment and the best customer service possible. We look forward to sharing the benefits of the exciting new growth opportunities this combination will provide with all of our stakeholders."

The transaction is subject to approval by both companies' shareholders, the satisfaction of customary closing conditions and regulatory review and approvals, including antitrust agencies and the FCC. Pending regulatory approval, the companies expect the transaction to be completed by the end of 2007.

SIRIUS's financial advisor on the transaction is Morgan Stanley and Simpson Thacher & Bartlett LLP and Wiley Rein LLP are acting as legal counsel. XM's financial advisor on the transaction is J.P. Morgan Securities Inc. and Skadden Arps, Slate, Meagher & Flom LLP; Jones Day; and Latham & Watkins LLP are acting as legal counsel.

Conference Call and Webcast Information

The companies will hold a joint conference call and webcast on Tuesday, February 20, 2007 at 8:30 AM ET to discuss this announcement. The conference call can be monitored by dialing 800-573-4840 within the U.S. and 617-224-4326 for all other locations, passcode 29490052. The webcast can be accessed at http://www.sirius.com and http://www.xmradio.com as well as on their satellite radio services by tuning to SIRIUS channel 122 and XM channel 200. The webcast will be archived at http://www.sirius.com and http://www.xmradio.com.

About SIRIUS

SIRIUS, "The Best Radio on Radio," delivers more than 130 channels of the best programming in all of radio. SIRIUS is the original and only home of 100% commercial free music channels in satellite radio, offering 69 music channels. SIRIUS also delivers 65 channels of sports, news, talk, entertainment, traffic, weather and data. SIRIUS is the Official Satellite Radio Partner of the NFL, NASCAR, NBA and NHL, and broadcasts live play-by-play games of the NFL, NBA and NHL, as well as live NASCAR races. All SIRIUS programming is available for a monthly subscription fee of only $12.95.

SIRIUS Internet Radio (SIR) is a CD-quality, Internet-only version of the SIRIUS radio service, without the use of a radio, for the monthly subscription fee of $12.95. SIR delivers more than 75 channels of talk, entertainment, sports, and 100% commercial free music.

SIRIUS products for the car, truck, home, RV and boat are available in more than 25,000 retail locations, including Best Buy, Circuit City, Crutchfield, Costco, Target, Wal-Mart, Sam's Club, RadioShack and at http://shop.sirius.com.

SIRIUS radios are offered in vehicles from Audi, Bentley, BMW, Chrysler, Dodge, Ford, Infiniti, Jaguar, Jeep®, Land Rover, Lexus, Lincoln, Mercury, Maybach, Mazda, Mercedes-Benz, MINI, Mitsubishi, Nissan, Rolls Royce, Scion, Toyota, Volkswagen, and Volvo. Hertz also offers SIRIUS in its rental cars at major locations around the country.

Click on http://www.sirius.com to listen to SIRIUS live, or to purchase a SIRIUS radio and subscription.

About XM

XM (Nasdaq: XMSR - News) is America's number one satellite radio company with more than 7.6 million subscribers. Broadcasting live daily from studios in Washington, DC, New York City, Chicago, the Country Music Hall of Fame in Nashville, Toronto and Montreal, XM's 2007 lineup includes more than 170 digital channels of choice from coast to coast: commercial-free music, premier sports, news, talk radio, comedy, children's and entertainment programming; and the most advanced traffic and weather information.

XM, the leader in satellite-delivered entertainment and data services for the automobile market through partnerships with General Motors, Honda, Hyundai, Nissan, Porsche, Subaru, Suzuki and Toyota is available in 140 different vehicle models for 2007. XM's industry-leading products are available at consumer electronics retailers nationwide. For more information about XM hardware, programming and partnerships, please visit http://www.xmradio.com.

Forward Looking Statements

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about the benefits of the business combination transaction involving Sirius Satellite Radio Inc. and XM Satellite Radio Holdings Inc., including potential synergies and cost savings and the timing thereof, future financial and operating results, the combined company's plans, objectives, expectations and intentions with respect to future operations, products and services; and other statements identified by words such as "anticipate," "believe," "plan," "estimate," "expect," "intend," "will," "should," "may," or words of similar meaning. Such forward- looking statements are based upon the current beliefs and expectations of SIRIUS' and XM's management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond the control of SIRIUS and XM. Actual results may differ materially from the results anticipated in these forward-looking statements.

The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statement: general business and economic conditions; the performance of financial markets and interest rates; the ability to obtain governmental approvals of the transaction on a timely basis; the failure of SIRIUS and XM shareholders to approve the transaction; the failure to realize synergies and cost-savings from the transaction or delay in realization thereof; the businesses of SIRIUS and XM may not be combined successfully, or such combination may take longer, be more difficult, time-consuming or costly to accomplish than expected; and operating costs and business disruption following the merger, including adverse effects on employee retention and on our business relationships with third parties, including manufacturers of radios, retailers, automakers and programming providers. Additional factors that could cause SIRIUS' and XM's results to differ materially from those described in the forward-looking statements can be found in SIRIUS' and XM's Annual Reports on Form 10-K for the year ended December 31, 2005, and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2006, June 30, 2006 and September 30, 2006 which are filed with the Securities and Exchange Commission (the "SEC") and available at the SEC's Internet site (http://www.sec.gov). The information set forth herein speaks only as of the date hereof, and Sirius and XM disclaim any intention or obligation to update any forward looking statements as a result of developments occurring after the date of this press release.

Important Additional Information Will be Filed with the SEC

This communication is being made in respect of the proposed business combination involving SIRIUS and XM. In connection with the proposed transaction, SIRIUS plans to file with the SEC a Registration Statement on Form S-4 containing a Joint Proxy Statement/Prospectus and each of SIRIUS and XM plan to file with the SEC other documents regarding the proposed transaction. The definitive Joint Proxy Statement/Prospectus will be mailed to stockholders of SIRIUS and XM. INVESTORS AND SECURITY HOLDERS OF SIRIUS AND XM ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.

Investors and security holders will be able to obtain free copies of the Registration Statement and the Joint Proxy Statement/Prospectus (when available) and other documents filed with the SEC by SIRIUS and XM through the web site maintained by the SEC at http://www.sec.gov. Free copies of the Registration Statement and the Joint Proxy Statement/Prospectus (when available) and other documents filed with the SEC can also be obtained by directing a request to Sirius Satellite Radio Inc., 1221 Avenue of the Americas, New York, NY 10020, Attention: Investor Relations or by directing a request to XM Satellite Radio Holdings Inc., 1500 Eckington Place, NE Washington, DC 20002, Attention: Investor Relations.

SIRIUS, XM and their respective directors and executive officers and other persons may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information regarding SIRIUS' directors and executive officers is available in its Annual Report on Form 10-K for the year ended December 31, 2005, which was filed with the SEC on March 13, 2006, and its proxy statement for its 2006 annual meeting of stockholders, which was filed with the SEC on April 21, 2006, and information regarding XM's directors and executive officers is available in XM's Annual Report on Form 10-K, for the year ended December 31, 2005, which was filed with the SEC on March 3, 2006 and its proxy statement for its 2006 annual meeting of shareholders, which was filed with the SEC on April 25, 2006. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the Joint Proxy Statement/Prospectus and other relevant materials to be filed with the SEC when they become available.

Under the terms of the agreement, XM shareholders will receive a fixed exchange ratio of 4.6 shares of SIRIUS common stock for each share of XM they own. XM and SIRIUS shareholders will each own approximately 50 percent of the combined company.

Mel Karmazin, currently Chief Executive Officer of SIRIUS, will become Chief Executive Officer of the combined company and Gary Parsons, currently Chairman of XM, will become Chairman of the combined company. The new company's board of directors will consist of 12 directors, including Messrs. Karmazin and Parsons, four independent members designated by each company, as well as one representative from each of General Motors and American Honda. Hugh Panero, the Chief Executive Officer of XM, will continue in his current role until the anticipated close of the merger.

The combined company will benefit from a highly experienced management team from both companies with extensive industry knowledge in radio, media, consumer electronics, OEM engineering and technology. Further management appointments will be announced prior to closing. The companies will continue to operate independently until the transaction is completed and will work together to determine the combined company's corporate name and headquarters location prior to closing.

The combination creates a nationwide audio entertainment provider with combined 2006 revenues of approximately $1.5 billion based on analysts' consensus estimates. Today the companies have approximately 14 million combined subscribers. Together, SIRIUS and XM will create a stronger platform for future innovation within the audio entertainment industry and will provide significant benefits to all constituencies, including:

* Greater Programming and Content Choices -- The combined company is
committed to consumer choice, including offering consumers the ability
to pick and choose the channels and content they want on a more a la
carte basis. The combined company will also provide consumers with a
broader selection of content, including a wide range of commercial-free
music channels, exclusive and non-exclusive sports coverage, news,
talk, and entertainment programming. Together, XM and SIRIUS will be
able to improve on products such as real-time traffic and rear-seat
video and introduce new ones such as advanced data services including
enhanced traffic, weather and infotainment offerings.

* Accelerated Technological Innovation -- The merger will enable the
combined company to develop and introduce a wider range of lower cost,
easy-to-use, and multi-functional devices through efficiencies in chip
set and radio design and procurement. Such innovation is essential to
remaining competitive in the consumer electronics-driven world of audio
entertainment.

* Benefits to OEM and Retail Partners -- The combined company will offer
automakers and retailers the opportunity to provide a broader content
offering to their customers. Consumer electronics retailers, including
Best Buy, Circuit City, RadioShack, Wal-Mart and others, will benefit
from enhanced product offerings that should allow satellite radio to
compete more effectively.

* Enhanced Financial Performance -- This transaction will enhance the
long-term financial success of satellite radio by allowing the combined
company to better manage its costs through sales and marketing and
subscriber acquisition efficiencies, satellite fleet synergies, combined
R&D and other benefits from economies of scale. Wall Street equity
analysts have published estimates of the present value of cost synergies
ranging from $3 billion to $7 billion.

* More Competitive Audio Entertainment Provider -- The combination of an
enhanced programming lineup with improved technology, distribution and
financials will better position satellite radio to compete for
consumers' attention and entertainment dollars against a host of
products and services in the highly competitive and rapidly evolving
audio entertainment marketplace. In addition to existing competition
from free "over-the-air" AM and FM radio as well as iPods and mobile
phone streaming, satellite radio will face new challenges from the rapid
growth of HD Radio, Internet radio and next generation wireless
technologies.

"We are excited for the many opportunities that an XM and SIRIUS combination will provide consumers," said Gary Parsons, Chairman of XM Satellite Radio and Hugh Panero, CEO of XM Satellite Radio, in a joint statement. "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."

"This combination is the next logical step in the evolution of audio entertainment," said Mel Karmazin, CEO of SIRIUS Satellite Radio. "Together, our best-in-class management team and programming content will create unprecedented choice for consumers, while creating long-term value for shareholders of both companies. The combined company will be positioned to capitalize on SIRIUS and XM's complementary distribution and licensing agreements to enhance availability of satellite radios, offer expanded content to subscribers, drive increased advertising revenue and reduce expenses. Each of our companies has a strong commitment to providing listeners the broadest range of music, news, sports and entertainment and the best customer service possible. We look forward to sharing the benefits of the exciting new growth opportunities this combination will provide with all of our stakeholders."

The transaction is subject to approval by both companies' shareholders, the satisfaction of customary closing conditions and regulatory review and approvals, including antitrust agencies and the FCC. Pending regulatory approval, the companies expect the transaction to be completed by the end of 2007.

SIRIUS's financial advisor on the transaction is Morgan Stanley and Simpson Thacher & Bartlett LLP and Wiley Rein LLP are acting as legal counsel. XM's financial advisor on the transaction is J.P. Morgan Securities Inc. and Skadden Arps, Slate, Meagher & Flom LLP; Jones Day; and Latham & Watkins LLP are acting as legal counsel.

Conference Call and Webcast Information

The companies will hold a joint conference call and webcast on Tuesday, February 20, 2007 at 8:30 AM ET to discuss this announcement. The conference call can be monitored by dialing 800-573-4840 within the U.S. and 617-224-4326 for all other locations, passcode 29490052. The webcast can be accessed at http://www.sirius.com and http://www.xmradio.com as well as on their satellite radio services by tuning to SIRIUS channel 122 and XM channel 200. The webcast will be archived at http://www.sirius.com and http://www.xmradio.com.

About SIRIUS

SIRIUS, "The Best Radio on Radio," delivers more than 130 channels of the best programming in all of radio. SIRIUS is the original and only home of 100% commercial free music channels in satellite radio, offering 69 music channels. SIRIUS also delivers 65 channels of sports, news, talk, entertainment, traffic, weather and data. SIRIUS is the Official Satellite Radio Partner of the NFL, NASCAR, NBA and NHL, and broadcasts live play-by-play games of the NFL, NBA and NHL, as well as live NASCAR races. All SIRIUS programming is available for a monthly subscription fee of only $12.95.

SIRIUS Internet Radio (SIR) is a CD-quality, Internet-only version of the SIRIUS radio service, without the use of a radio, for the monthly subscription fee of $12.95. SIR delivers more than 75 channels of talk, entertainment, sports, and 100% commercial free music.

SIRIUS products for the car, truck, home, RV and boat are available in more than 25,000 retail locations, including Best Buy, Circuit City, Crutchfield, Costco, Target, Wal-Mart, Sam's Club, RadioShack and at http://shop.sirius.com.

SIRIUS radios are offered in vehicles from Audi, Bentley, BMW, Chrysler, Dodge, Ford, Infiniti, Jaguar, Jeep®, Land Rover, Lexus, Lincoln, Mercury, Maybach, Mazda, Mercedes-Benz, MINI, Mitsubishi, Nissan, Rolls Royce, Scion, Toyota, Volkswagen, and Volvo. Hertz also offers SIRIUS in its rental cars at major locations around the country.

Click on http://www.sirius.com to listen to SIRIUS live, or to purchase a SIRIUS radio and subscription.

About XM

XM (Nasdaq: XMSR - News) is America's number one satellite radio company with more than 7.6 million subscribers. Broadcasting live daily from studios in Washington, DC, New York City, Chicago, the Country Music Hall of Fame in Nashville, Toronto and Montreal, XM's 2007 lineup includes more than 170 digital channels of choice from coast to coast: commercial-free music, premier sports, news, talk radio, comedy, children's and entertainment programming; and the most advanced traffic and weather information.

XM, the leader in satellite-delivered entertainment and data services for the automobile market through partnerships with General Motors, Honda, Hyundai, Nissan, Porsche, Subaru, Suzuki and Toyota is available in 140 different vehicle models for 2007. XM's industry-leading products are available at consumer electronics retailers nationwide. For more information about XM hardware, programming and partnerships, please visit http://www.xmradio.com.

Forward Looking Statements

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about the benefits of the business combination transaction involving Sirius Satellite Radio Inc. and XM Satellite Radio Holdings Inc., including potential synergies and cost savings and the timing thereof, future financial and operating results, the combined company's plans, objectives, expectations and intentions with respect to future operations, products and services; and other statements identified by words such as "anticipate," "believe," "plan," "estimate," "expect," "intend," "will," "should," "may," or words of similar meaning. Such forward- looking statements are based upon the current beliefs and expectations of SIRIUS' and XM's management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond the control of SIRIUS and XM. Actual results may differ materially from the results anticipated in these forward-looking statements.

The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statement: general business and economic conditions; the performance of financial markets and interest rates; the ability to obtain governmental approvals of the transaction on a timely basis; the failure of SIRIUS and XM shareholders to approve the transaction; the failure to realize synergies and cost-savings from the transaction or delay in realization thereof; the businesses of SIRIUS and XM may not be combined successfully, or such combination may take longer, be more difficult, time-consuming or costly to accomplish than expected; and operating costs and business disruption following the merger, including adverse effects on employee retention and on our business relationships with third parties, including manufacturers of radios, retailers, automakers and programming providers. Additional factors that could cause SIRIUS' and XM's results to differ materially from those described in the forward-looking statements can be found in SIRIUS' and XM's Annual Reports on Form 10-K for the year ended December 31, 2005, and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2006, June 30, 2006 and September 30, 2006 which are filed with the Securities and Exchange Commission (the "SEC") and available at the SEC's Internet site (http://www.sec.gov). The information set forth herein speaks only as of the date hereof, and Sirius and XM disclaim any intention or obligation to update any forward looking statements as a result of developments occurring after the date of this press release.

Important Additional Information Will be Filed with the SEC

This communication is being made in respect of the proposed business combination involving SIRIUS and XM. In connection with the proposed transaction, SIRIUS plans to file with the SEC a Registration Statement on Form S-4 containing a Joint Proxy Statement/Prospectus and each of SIRIUS and XM plan to file with the SEC other documents regarding the proposed transaction. The definitive Joint Proxy Statement/Prospectus will be mailed to stockholders of SIRIUS and XM. INVESTORS AND SECURITY HOLDERS OF SIRIUS AND XM ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.

Investors and security holders will be able to obtain free copies of the Registration Statement and the Joint Proxy Statement/Prospectus (when available) and other documents filed with the SEC by SIRIUS and XM through the web site maintained by the SEC at http://www.sec.gov. Free copies of the Registration Statement and the Joint Proxy Statement/Prospectus (when available) and other documents filed with the SEC can also be obtained by directing a request to Sirius Satellite Radio Inc., 1221 Avenue of the Americas, New York, NY 10020, Attention: Investor Relations or by directing a request to XM Satellite Radio Holdings Inc., 1500 Eckington Place, NE Washington, DC 20002, Attention: Investor Relations.

SIRIUS, XM and their respective directors and executive officers and other persons may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information regarding SIRIUS' directors and executive officers is available in its Annual Report on Form 10-K for the year ended December 31, 2005, which was filed with the SEC on March 13, 2006, and its proxy statement for its 2006 annual meeting of stockholders, which was filed with the SEC on April 21, 2006, and information regarding XM's directors and executive officers is available in XM's Annual Report on Form 10-K, for the year ended December 31, 2005, which was filed with the SEC on March 3, 2006 and its proxy statement for its 2006 annual meeting of shareholders, which was filed with the SEC on April 25, 2006. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the Joint Proxy Statement/Prospectus and other relevant materials to be filed with the SEC when they become available.

Labels: merger, sirius, xm

2/19/2007 03:19:00 PM

SSG Has Merged. You Can Read All Of The Latest SSG Content By Clicking Here



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New York Post: Sirius And XM Expected To Announce Merger Today

HEAVENLY DEAL
By PETER LAURIA, February 19, 2007, The New York Post

Satellite radio operators Sirius and XM are expected to announce their long-awaited merger today, according to a source familiar with the deal.
The two sides were locked in negotiations over the weekend trying to hammer out a final agreement with an eye toward going public with the merger today in Washington, D.C., where XM is based, this source said.
Talks were still going on at press time and the deal could fall apart at any time. With antitrust issues of paramount importance, this source said lawyers for both companies were working overtime to fine-tune the language of the agreement and frame the discussion around the deal itself and not regulatory concerns.
The transaction is expected to be structured as a merger of equals, but given Sirius' higher enterprise value, shareholders in the Mel Karmazin-led firm will likely come away with a larger percentage of a combined company.
According to the source, XM Chairman Gary Parsons will retain that title in the combined entity, with Karmazin likely taking the CEO role. It is unclear what role, if any, XM CEO Hugh Panero will play.
Combining Sirius and XM would result in a single satellite radio operator with more than 12 million total subscribers. A deal would also marry Sirius content, such as Howard Stern, Frank Sinatra and Nascar with XM's Oprah Winfrey, Bob Dylan and Major League Baseball...read more: here

2/19/2007 08:26:00 AM

SSG Has Merged. You Can Read All Of The Latest SSG Content By Clicking Here



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Sirius To Air Barbara Walters Live Call-In Special On Presidents Day

2/18/2007 09:05:00 PM

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24/7WallSt: Could Sirius And XM Merge Before Q4 Earnings?

February 18, 2007, via www.247wallstreet.com

Could XM & SIRIUS Merge Before Earnings?

Sirius Satellite Radio (SIRI-NASDAQ) and XM Satellite Radio (XMSR-NASDAQ) are both 1 week from earnings: SIRI reports early morning on February 27 and XMSR reports on February 26 early morning. The past quarters that will be reported are largely irrelevant. The guidance for 2007 and the subscriber numbers are what will guide the street, and most important will be the question if these two are finally going to tie the knot. The companies already gave 2006-end subscriber numbers so the actual revenues should be quite close to estimates. UBS also made some subscriber targets earlier this month for this year...read more: Here

Labels: 247wallst.com, merger, sirius, xm

2/18/2007 09:00:00 PM

SSG Has Merged. You Can Read All Of The Latest SSG Content By Clicking Here



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Seeking Alpha: SAC Lowers Stake In XMSR

Labels: goldman sachs, sac, seeking alpha, t rowe price, xm

2/18/2007 07:52:00 PM

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Sirius Wins With NASCAR

February 18, 2007

One of the truly wonderful things about satellite radio is the vast array of content available, and the ability to access that content so simply. The platform of satellite radio literally gives you the ability to experiment with new forms of music and new forms of radio entertainment.

I would consider myself a very casual fan of NASCAR. I have never attended a NASCARR race, and have seen parts of races on television from time to time. I could name and identify the top drivers, but on a week to week basis would not likely be able to tell you who won, or who leads in the point standings.

The arrival of NASCAR to Sirius has actually had me tune in to watch the race. The fact that I can listen to Driver-To-Crew communications during the race via satellite radio added a dynamic that I felt was rather compelling.

If I, as a very casual fan, found the Driver-To-Crew broadcasts compelling enough for me to become involved in this race, imagine how true fans of NASCAR must feel about this capability.

What Sirius has done with the NASCAR contract is what should have been done long ago. Sirius took content that is already widely available on television and radio, and added a component that television and traditional radio could not. In doing so, Sirius has built a value into their NASCAR programming. That added value is what will bring subscribers to the satellite radio platform.

In the past, traditional radio and even XM Satellite Radio were only 3 feet away from gold. Sirius took the extra step to make the programming more compelling. They added a feature that typically is only available at the track, or on a computer. Now, a NASCAR fan can tune in a race on the television, but is not tied to the couch during the 3 to 4 hour event. The fan can actually get up and do some other activities while listening to the race, and further, can get an “in-the-car” experience via the Driver-To-Crew service.

Sirius’ launch of NASCAR, and the thought that went into it, are perhaps one of the better examples of integrating sports into radio that takes it beyond the typical and into the special.

The Sirius delivery of NASCAR content is simply RADIO GOLD. It is my hope that Sirius and XM both see the successes of this type of programming, and step up how other sports, and all programming for that matter, are done. Satellite radio has the unique opportunity to create the type of content and programming that will create huge demand.

Labels: driver-to-crew, nascar, sirius

2/18/2007 05:11:00 PM

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Sirius Upgrades Stiletto Software

Labels: sirius, software, stiletto

2/17/2007 08:07:00 AM

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BusinessWeek Picks Up Bear Stearns' Merger Report

Analyst to XM, Sirius: Quit Quibbling
A Bear Stearns analyst says merger talks between the satellite radio operators are hung up on control issues, not regulatory hurdles
by Sonja Ryst , www.businessweek.com

Federal regulators aren't likely to block a combination of the nation's two satellite radio operators, XM and Sirius, but disagreement over how to split control of a combined company is probably slowing matters, a Bear Stearns (BSC) analyst wrote Feb. 16, urging the companies' shareholders to press the issue.
In other words, enough with the quibbling and just work it out, analyst Robert Peck suggested in a widely read report that sent XM Satellite Radio (XMSR) shares surging 7.7%, to $13.98 on the Nasdaq. Shares of rival Sirius Satellite Radio Holdings (SIRI) gained 2.8%, to $3.70, just above their 52-week low of $3.50, reached late last year...read more: here

Labels: bear stearns, businessweek, merger, sirius, xm

2/17/2007 08:02:00 AM

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Terrestrial Not Happy With Satellite's Public Radio Content

Radio isn't happy about XM Public Radio's latest deal
via www.orbitcast.com

Apparently terrestrial radio isn't so happy about American Public Media's deal with XM Satellite Radio.
While the cornerstone shows "A Prairie Home Companion" and "Marketplace" are still going to be syndicated to terrestrial stations, the perceived problem is that they'll no longer be exclusive to terrestrial. Maybe someone should have told them that Prairie Home and Marketplace were available on Sirius' NPR Now (ch 134) for a while now...read more: here

Labels: npr, siri, xm

2/17/2007 07:37:00 AM

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Cogeco, The Canadian Cable Co, Granted Right To Distribute Radio Service

Cogeco gets go-ahead to distribute Satellite Radio
via www.orbitcast.com

The CRTC has granted Canada's fourth largest cable company, Cogeco Cable, the right to distribute satellite radio services on digital cable.
Currently Cogeco distributes two pay audio services, Galaxie and Max Trax, but this decision means that Cogeco customers will be able to subscribe to Sirius Satellite Radio or XM Satellite Radio over their digital cable service...read more: here

Labels: cable tv, sirius canada, xm canada

2/17/2007 07:32:00 AM

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Another Merger Note Creates Deeper Confusion

February 16, 2007

Bob Peck of Bear Stearns issued a note today regarding a merer, and once again, there seems to be some confusion over how these comapnies would be valued in the event of a merger.

The most common error made is when investors look at Market Cap rather than Enterprise Value.

Enterprise Value is a far better metric when it comnes to company valuations because it considers many factors that market cap does not consider.

So what is Enterprise Value, and why is it a more accurate measure of the value of a company??

Enterprise Value is a figure that theoretically represents the entire cost of a company if someone were to acquire it.

Enterprise Value includes a number of important factors such as debt, preferred stock and cash reserves. Market Cap does not take these important metrics into consideration.

Enterprise Value is calculated by adding a company's :

Market Capitalization
Preferred Stock
Outstanding Debt

Then Subtracting:

Cash
Cash Equivalents from the balance sheet

Simply stated, Enterprise Value is what it would cost to buy a company’s shares of common stock, preferred stock, and outstanding debt.

Basically, investors need to look at the Enterprise Value of these companies as they try to consider various merger situations.

Labels: bear stearns, bob peck, enerprise value, market cap, merger, sirius, xm

2/16/2007 08:45:00 PM

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Ricky Rudd Is The Fans Choice

February 16, 2007

Sirius, the new home of NASCAR has done a great job in turning racing on radio into something interactive and specail. The live audio streaming of drivers is a great way to give value to subscribers, and the Fans Choice poll takes it a step further. Congratulations Ricky on becoming the first Fans Choice driver.

Ricky Rudd to be Featured on SIRIUS Satellite Radio's 'Fan's Choice' Broadcast for Sunday's Daytona 500
Friday February 16, 7:21 pm ET

Fans vote for veteran driver's in-car audio to air on SIRIUS

NEW YORK, Feb. 16 /PRNewswire-FirstCall/ -- SIRIUS Satellite Radio (Nasdaq: SIRI - News), the Official Satellite Radio Partner of NASCAR, announced today that the in-car audio of Ricky Rudd, driver of the No. 88 Snickers Ford, has been chosen by the fans to be featured on SIRIUS' "Fan's Choice" broadcast during the Daytona 500 this Sunday, February 18.

More than 10,000 fans cast their votes at http://www.sirius.com/driver2crew this week. As the top vote-getter, Rudd's in-car audio will be featured during Sunday's race on SIRIUS channel 140.

Prior to every NASCAR NEXTEL Cup Series race, fans will be given the chance to vote for their favorite driver at http://www.sirius.com/driver2crew. The driver with the most votes will have his in-car audio broadcast on the "Fan's Choice" channel, one of up to ten additional Driver2Crew Chatter(TM) channels that SIRIUS will devote to carrying the in-car audio of up to 10 different race teams for every NASCAR NEXTEL Cup Series race in 2007. The additional nine channels will carry the in-car audio of other drivers based on their place in the NASCAR NEXTEL Cup Series standings.

For this weekend's Daytona 500, SIRIUS subscribers can hear the following:

-- Live race call provided by Motor Racing Network -- channel 128
-- 10 additional Driver2Crew Chatter(TM) channels:
-- Jimmie Johnson in-car audio -- channel 122
-- Tony Stewart in-car audio -- channel 126
-- Dale Earnhardt Jr. in-car audio -- channel 125
-- Jeff Gordon in-car audio -- channel 121
-- Kasey Kahne in-car audio -- channel 114
-- Kevin Harvick in-car audio -- channel 119
-- Matt Kenseth in-car audio -- channel 130
-- Jeff Burton in-car audio -- channel 147
-- Denny Hamlin in-car audio -- channel 144
-- Ricky Rudd in-car audio (Fan's Choice) -- channel 140

On each channel SIRIUS will combine the race broadcast with the driver-to-crew communications, allowing fans to follow the overall race call and the in-car audio of a driver on a single channel throughout the race. Listeners will hear drivers and crew chiefs schedule pit stops and discuss strategy over audio of the overall race broadcast. When the team members are not on the radio the audio of the live race broadcast will come up allowing listeners to follow the entire race uninterrupted.

A lineup of drivers and their channel assignments will be available at http://www.sirius.com/driver2crew prior to each race. All NASCAR content is provided to SIRIUS customers at no additional cost over SIRIUS' monthly subscription fee.

Source: SIRIUS Satellite Radio

As the Official Satellite Radio Partner of NASCAR, SIRIUS broadcasts every NASCAR NEXTEL Cup Series, NASCAR Busch Series and NASCAR Craftsman Truck Series race live, carrying the broadcasts of Motor Racing Network (MRN), Performance Racing Network (PRN) and the IMS Radio Network's broadcast from Indianapolis Motor Speedway.

Labels: fans choice, nascar, ricky rudd, sirius

2/16/2007 08:31:00 PM

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Merger Speculation All Around

There have been rumors circulating about consolidation in the auto industry, and in my view, where there is smoke, there is fire.

There has been talk of Renault/Nissan and Ford or GM, GM and Ford, GM and Chrysler, and an assortment of other combinations. Ther are also rumors of consolidation in the rental car market.

So if the auto manufacturers merge, ie, if Chryler (Sirius) and GM (XM) combine, it certainly makes sense for XM and Sirius to merge, too!

Labels: chrysler, ford, gm, merger

2/16/2007 11:43:00 AM

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A Deeper Look At The Bear Stearns Report

February 16, 2007

No Time for Quibbling; 60% of $0 = ZERO

•We think that both XM and Sirius believe a proposed merger could likely pass the regulatory hurdles, which we think would push them to attempt a merger. However, beyond the initial warming public comments made by both companies in early January, the public potential deal talk has slowed, hampering both share prices (XM is down ~25% since its recent highs and Sirius is close to 52 week lows).

•We believe any public progress of making a deal has been slowed by the economics of the exact split in a MergeCo. However, we think that the sheer value proposition of a potential deal for both sets of shareholders vastly overshadows any disappointment in share of MergeCo. Due to a closing window of opportunity (based on how long we think it would comfortably take to close a potential deal), we think investors would implore the boards of both companies to avoid quibbling over a few share points, to capture the much larger value of overall potential synergies. This would maximize shareholder value for both companies.

•We provide a sensitivity of potential value accretion to XM shareholders based on the split of MergeCo which we center around ~55% for XM Radio. We believe both sides would argue a higher percentage in any potential deal, but feel this center point is appropriate given the estimates in our model. Currently, Sirius has >50% of the industry EV, which we think is driven by differences to our model that we outline in this note.

•We think that upon the expectation of a successful deal, the ~$6-7B in synergies would take the value of XM's stock to ~$25, presenting significant upside potential. Hence we think both sets of shareholders would benefit greatly upon a deal. With XM trading at a lower percent of industry EV, we think the stock will Outperform and recommend investors buy pre any potential announcement.

Labels: bear stearns, merger, peck, sirius, xm

2/16/2007 10:45:00 AM

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XMSR: Tony Kornheiser Show Starts Mar. 3

Tony Kornheiser to Air Nationwide on XM Satellite Radio
WASHINGTON, Feb. 15 /PRNewswire-FirstCall/ --

Tony Kornheiser --sportswriter, columnist, ESPN commentator, humorist, and author -- will beheard nationwide on XM Satellite Radio starting March 5. Kornheiser's new radio show, originating from Washington Post Radio (WTWP) in Washington, D.C., will air from coast to coast on XM's sports talk radio channel XM Sports Nation (XM Channel 144) Monday through Friday from 9 am to11 am ET. Tony will also host special shows exclusively for the XM Radioaudience on a regular basis...continued

2/16/2007 07:58:00 AM

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NAB And FM Modulators: Why Don't They Request Recall For iPods And MP3's?

New autos come equipped with auxilliary input jacks, so this is becoming a moot point. I find it interesting that the NAB focuses on satellite radio and ignore the "bleed" from FM modulators used with iPods and other MP3 players.

NAB Renews Plea for Recall of 'Unlawful' Satellite Radio Devices
2.16.2007

NAB President/CEO David Rehr reiterated his call for the FCC to authorize a recall of satellite radio FM modulated devices that violate Part 15 power limits.
In a letter to Chairman Kevin Martin, Rehr cited a recent report from The New York Times on satellite radio interference with local radio signals. Of particular concern are “FM listeners in their cars and listeners of public and religious programming on noncommercial stations typically located at the lower end of the FM band,” Rehr said in the letter.
Last year, Rehr sent a letter to the heads of XM and Sirius Satellite Radio urging each company to “voluntarily withdraw and replace all noncompliant satellite radio devices in circulation.”...continued

Labels: fm modulators, ipod, mp3, nab, siri, xm

2/16/2007 07:50:00 AM

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Bear Stearns: Proposed Merger Might Pass Regulatory Hurdles

Bear Stearns Rekindles XM/Sirius Merger Chatter
Posted on Feb 16th, 2007 with stocks: SIRI, XMSR

Notable Calls submits: Bear Stearns out with an interesting note, saying that they think both XM Satellite (NASDAQ:XMSR) and Sirius (NASDAQ:SIRI) believe a proposed merger could likely pass the regulatory hurdles, which they think would push them to attempt a merger. However, beyond the initial warming public comments made by both companies in early January, the public potential deal talk has slowed, hampering both share prices (XM is down ~25% since its recent highs and Sirius is close to 52 week lows).

Firm believes any public progress of making a deal has been slowed by the economics of the exact split in a merged company. However, they think that the sheer value proposition of a potential deal for both sets of shareholders vastly overshadows any disappointment in share of a merged company. Due to a closing window of opportunity (based on how long we think it would comfortably take to close a potential deal), firm thinks investors would implore the boards of both companies to avoid quibbling over a few share points, to capture the much larger value of overall potential synergies. This would maximize shareholder value for both companies...continued

Labels: bear stearns, merger, sirius, xm

2/16/2007 07:48:00 AM

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Oprah Has The Secret - Now You Can have It

February 8, 2007

UPDATE - February 15, 2007: We were just informed that Oprah is going to have a second segment on the world wide success of "The Secret"!!! The Secret is available in DVD or CD, and is something that I highly recommend to SSG readers. If you would like more information on The secret, simply click on any of The Secret banners here on SSG. Also, be sure to check out Oprah on February 16th.

In the fall of 2006 I was introduced to a DVD called The Secret. I watched the DVD, and frankly was so impressed that I began implementing the things I learned from The Secret into my life with fantastic results. Since being introduced to this DVD I have watched it several times, and have put The Secret to use in my life. Click the banner to learn more.

I was quite surprised to see that Oprah Winfrey had on the folks from The Secret today. Those that have XM Satellite Radio could well hear some buzz surrounding The Secret on Oprah's channel, and I would highly suggest that you take the time to catch anything related to this topic.

Readers may wonder exactly what The Secret is. There is no real easy explanation other than to tell you that you can control more of the outcome in your life than you currently believe. "The Secret" is not so much as a secret as it is a philosophy. understanding various dynamics in life, and how interactions impact those dynamics is the basic and fundamental teaching of The Secret. The Secret helps you understand just how important it is to consciously choose the thoughts you hold each day; to keep your thoughts and actions focused on what you really want to attract into your life. It is all up to you. Take charge of your thoughts, and you’ll take charge of your life.

All I can say is that I found The Secret so compelling that i have shared it with many people in my life, and often have trouble getting my DVD back. Seeing The Secret on Oprah today made me wonder why I had never shared The Secret here on SSG. Well, thanks to Oprah, and her association with XM Satellite Radio I made the connection that previous to now I had not thought of. That being said, I have now shared The Secret with the readers of this site. If you do get the DVD, I would love to hear how The Secret impacted your life, and what your thoughts are.

Labels: oprah, the secret

2/15/2007 06:11:00 PM

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Institutional Ownership

February 15, 2007,

Today is the 15th, and that represents the closing date for institutions to file their respective ownership in equities. Likely there is still some data to get into the system, but as of now institutional ownership is:

SIRI - 31.47%

XMSR - 85.23%

Labels: institutional ownership, sirius, xm

2/15/2007 08:12:00 AM

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Consolidation In Car Rental Sector

Four Brands in Car Rental May Merge By ANDREW ROSS SORKIN, Feb15, The New York Times

A deal to combine four of the nation’s largest car rental brands — National, Alamo, Thrifty and Dollar — is being discussed as the industry continues to consolidate.

Dollar Thrifty Automotive Group is in early talks to merge with Vanguard Car Rental, of Tulsa, Okla., which owns National and Alamo, in a deal valued at more than $3 billion, according to people involved in the discussions.

The negotiations, which have been taking place on and off for several months, are at a particularly delicate stage, these people said, and may still collapse.

If completed, a deal would create the third-largest rental car company in the United States behind leaders Enterprise Rent-a-Car and Hertz Global Holdings, but outpacing Avis Budget Group in terms of revenue.

A deal could push rental car rates higher. Prices have already risen 10 percent to 20 percent in the last year as the Detroit automakers have tried to move away from providing discounted fleet vehicles to rental car companies and focus on higher-margin retail customers...continued

2/15/2007 07:36:00 AM

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DCX May Partner On Chrysler

Daimler Weighs Chrysler OptionsPartner Might Be Sought
Or Unit Sold as Job Cuts,Plant Closing Are Set
By STEPHEN POWER, DENNIS K. BERMAN and GINA CHON
Staff Reporters of THE WALL STREET JOURNAL,February 15, 2007; Page A3

DaimlerChrysler AG's acknowledgment yesterday that it may have to find a partner or spin off its ailing Chrysler arm underscores the depth of the crisis facing Detroit's auto makers -- but also could present an opportunity for a rival seeking a greater presence in North America.

The German-American auto titan, which reported a 40% drop in fourth-quarter net income as a result of a €124 million ($161.7 million) operating loss at its Chrysler arm, outlined a sweeping restructuring plan that includes cutting 13,000 jobs in the U.S. and Canada, closing one auto-assembly plant, additional production cuts and the elimination of some slow-selling models from its product line...continued

2/15/2007 07:33:00 AM

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The Future Of Radio: Video

Is Radio Still Radio if There’s Video?
By RICHARD SIKLOS, Feb 14, 2007, The New Tork Times

Ted Stryker, a D.J. at KROQ in Los Angeles, considers it a perk of the job to wear shorts and T-shirts to work. But last Sunday as he dressed for the Grammy Awards, he pulled out his best blazer and a flashy belt buckle, knowing three video cameras would stream live coverage of his show to the Web sites of 147 CBS radio stations.

“What’s great about radio is no one knows what you’re wearing,” Mr. Stryker said by telephone as he made his way through the throng at the Grammys. “I wanted to make myself a little bit more presentable.”

Mr. Stryker, who has done some TV work in the past, said that to create his best radio voice, he often must contort his face in embarrassing ways.

“It’s so different doing radio compared to TV,” he said. “Who knows what faces I make when I’m talking on the radio? I hope I’m not making the same faces today.”

The nation’s commercial radio stations have seen the future, and it is in, of all things, video. As a result, the stereotype of a silken-voiced jockey like Mr. Stryker, slumped and disheveled in the studio chair, may never be the same.

Across the country, radio stations are putting up video fare on their Web sites, ranging from a simple camera in the broadcast booth to exclusive coverage of events like the Super Bowl to music videos, news clips and Web-only musical performances...read more: here

2/15/2007 07:30:00 AM

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Bridge Ratings, Updated Feb 14th

Bridge Ratings Youth Audience Media Use Study 2007

For Immediate Release:

Wednesday, February 14, 2007

Youths Spending More Time with Cell Phones & MP3 Players

Bridge Ratings & Research recently concluded the second phase of its study on the media habits of 15-24 year olds and has confirmed initial perceptions that young people continue to spend less time listening to the radio as a result of increased use of the internet, cell phones and MP3 players.

The study conducted during the second half of 2006 found that 33% of 15-24 year olds are listening to less radio as a result of their time on the Internet, while 10% are spending more time. The 33% number is up from 20% in a similar study taken in August 2005.

Other findings of the study include: nearly a quarter (24%) watching less conventional TV with an almost identical number (22%) saying they are spending more time watching video on the Internet on such sites as YouTube, Yahoo! and MySpace, or streamed replays of prime time shows on TV network websites.

The study also found that young people are spending most of their total media time (23%) online, more than watching television (22%), listening to the radio (16%) and listening to their MP3 players (19%).

The study revealed that music, instant messaging and video streaming dominates online activity for this age group with the Internet increasingly providing a cheaper and more convenient means of purchasing and downloading tracks. 42% of 15-24 year olds have downloaded music online in the last thirty days compared to 27% in 2005 and 18% in 2004. 29% of this age group still visit and purchase music at traditional brick and mortar stores down fro 38% in 2005. Respondents were asked what offline activities they commonly conduct while online...read more: here

2/14/2007 10:26:00 PM

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Forbes: Sirius Has Strong Showing In Canada

Canada In For Some Sirius ListeningMatthew Kirdahy, 02.14.07, 5:30 PM ET, Forbes

Canadians have a Sirius fascination with satellite radio.

Sirius Satellite Radio, No. 2 in the business behind XM Satellite Radio in the U.S., said Wednesday it surpassed 300,000 paying subscribers in Canada. More than 100,000 of those people joined the service in the past three months.

"Surpassing 300,000 paying subscribers in such a short time confirms the demand for and strength of Sirius' programming, signal coverage, and innovative products," said chief executive of U.S.-based company's Canadian division Mark Redmond in a news release.

"Sirius depth and breadth of programming resonates with Canadians and we are proud to be the country's undisputed satellite radio leader."

The company said that during this past holiday shopping season, more than 3,500 retail locations throughout Canada were fully stocked with Sirius latest plug-and-play and portable radios.

According to independent retail tracking research provided by the NPD Group, Sirius, which claims 75% of the market share in Canada, was the preferred choice for satellite radio this holiday season with nearly eight out of 10 satellite radio shoppers choosing Sirius in December.

The Washington, D.C.-based XM Satellite Radio has a Canadian contingent of about 147,000 subscribers. The company has offered its service there since November 2005...read more: here

Labels: forbes, sirius canada

2/14/2007 10:20:00 PM

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Bubba The LoveSponge Coming to Friday Mornings

February 14th, 2007

PR via: http://www.btls.com/Bubba021307.html

BUBBA THE LOVE SPONGE® SHOW TO AIR LIVE FRIDAY MORNINGS EXCLUSIVELY ON HOWARD 101 ON SIRIUS SATELLITE RADIO

On Howard’s other channel, Bubba is going to Friday mornings

NEW YORK –February 14, 2007 – SIRIUS Satellite Radio (NASDAQ: SIRI) today announced that beginning February 23, 2007, the Bubba the Love Sponge® Show will broadcast live Friday mornings on Howard 101. The Howard Stern Show airs mornings exclusively on Howard 100. Howard Stern programs both of his SIRIUS channels, Howard 100 and Howard 101.

Bubba the Love Sponge® will continue to host his daily show live during afternoon drive Monday - Thursday, from 3:00 to 7:00 pm ET on Howard 101. His new Friday morning show timeslot is 6:00 – 10:00 am ET; that show will rebroadcast on Friday afternoon from 3:00 – 7:00 pm ET.

The edgy Tampa, Florida-based radio host Bubba the Love Sponge® launched his SIRIUS Satellite Radio show on January 9, 2006, the same day The Howard Stern Show premiered on SIRIUS. The Bubba the Love Sponge® Show is produced and broadcast from a state-of-the-art studio in Florida, and features Bubba and his colorful sidekicks producer Brent Hatley, Spice Boy, Ned and Manson.

Bubba incorporates his love of sports (especially race car driving and NASCAR) and politics into every show, as well as song parodies, and a wide variety of comical and musical bits.

In addition to the Bubba the Love Sponge® Show, Howard 101 features original programming such as The Scott Ferrall Show, a nightly talk show hosted by veteran sports radio personality Scott Ferrall; Jackie’s Joke Hunt, a weekly comedy program hosted by former longtime Stern show member Jackie “The Joke Man” Martling; The Riley Martin Show, a weekly show about Martin’s alien experience; Superfan Roundtable, a weekly show featuring Stern “superfans” and appearances by the Wack Pack, and The Intern Show, on which the college-age interns reveal the behind the scenes details of working on The Howard Stern Show.

Labels: bubba, sirius, stern

2/14/2007 08:19:00 PM

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Toyota And Lexus Get Sirius In Canada

February 14, 2007

SIRIUS Satellite Radio available June 2007

TORONTO, Feb. 14 /CNW/ - Toyota Canada Inc. (TCI) and SIRIUS Canada, the country's leading satellite radio company, today announced a multi-year distribution agreement that will make SIRIUS Satellite Radio receivers available in select Toyota and Lexus vehicles, beginning June 2007.

Toyota Canada will offer dealer-installed SIRIUS Satellite Radio receivers with a subscription to SIRIUS Canada's premium 110 channel satellite radio service featuring the most commercial-free music and exclusive talk and entertainment programming in Canada. A number of Toyota and Lexus models are covered by the agreement and a complete listing of applicable models will be announced closer to launch.

"We are thrilled to announce this partnership with Toyota Canada," said Mark Redmond, President and CEO of SIRIUS Canada. "Toyota and Lexus vehicles are among Canada's most popular vehicle brands and we look forward to making SIRIUS Satellite Radio's premium 110 channel line up available to their customers. Now, Toyota and Lexus customers will be able to choose SIRIUS as their satellite radio provider of choice."

"TCI is committed to exceeding the expectations of our loyal customers, and that means offering Canadians a variety of choice for in-vehicle entertainment," said Tony Wearing, Managing Director of Toyota Canada Inc. "We are pleased to formalize our relationship with SIRIUS Canada and provide our customers with SIRIUS' premium 110 channel satellite radio service."

SIRIUS Canada's automotive partners include Aston Martin, Audi, BMW, Chrysler, Dodge, Ford, Jaguar, Jeep, Land Rover, Lexus, Lincoln, MINI, Pana-Pacific, Subaru, Toyota, Volkswagen and Volvo.

About Toyota Canada Inc.

Toyota Canada Inc. (TCI) is the exclusive Canadian distributor of Toyota cars, trucks, sports utility vehicles and forklifts, as well as Lexus luxury vehicles, through a sales and service network of over 260 dealers across Canada. A consistent award winner for product quality and ownership satisfaction, Toyota has sold over three million vehicles in Canada. More information about Toyota is available at www.toyota.ca, or through the Toyota Canada Customer Interaction Centre at 1-888-TOYOTA8.

Labels: lexus, OEM, sirius, sirius canada, toyota

2/14/2007 12:24:00 PM

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Mazda Gets sirius In Canada

February 14, 2007

Mazda Canada Signs Multi-year Exclusive Agreement with SIRIUS Canada

TORONTO, Feb. 14 /CNW/ - SIRIUS Canada, the country's fastest growing satellite radio company, and Mazda Canada today announced an exclusive, multi-year agreement that will make SIRIUS Satellite Radio receivers available in Mazda vehicles.

Mazda Canada will offer factory-installed, fully integrated SIRIUS Satellite Radio receivers with a subscription to SIRIUS Canada's premium 110 channel satellite radio service featuring the most commercial-free music and exclusive talk and entertainment programming in Canada. Additional details regarding the launch schedule and specific model availability will be announced in the coming months.

"We are thrilled to announce this partnership and make our premium 110 channel programming line up available to new Mazda customers," said Mark Redmond, President and CEO, SIRIUS Canada Inc. "SIRIUS offers drivers andpassengers a completely unique and memorable in-vehicle entertainment experience that can be fully customized to suit their taste."

"Zoom-Zoom is all about people connecting with their cars and the enjoyment of driving," said Don Romano, President, Mazda Canada Inc. "Now drivers have a chance to enhance their driving pleasure with clear, CD quality sound of SIRIUS satellite radio through their Mazda audio system."

SIRIUS Canada's automotive partners include Aston Martin, Audi, BMW, Chrysler, Dodge, Ford, Jaguar, Jeep, Land Rover, Lincoln, Mazda, MINI, Pana-Pacific, Subaru, Volkswagen and Volvo.


About SIRIUS Canada

From broadcast studios in Vancouver, Toronto, Montreal and New York, SIRIUS Canada delivers 110 premium channels of the best commercial-free music plus leading sports, news, talk and entertainment programming. With a total of 65 commercial-free music channels - the most in Canada - SIRIUS is the original and only home of 100% commercial-free music. SIRIUS offers the broadest range of Canadian content on satellite radio with 11 English and French channels. SIRIUS Canada is the Official Satellite Radio Partner of the CFL, NHL, NFL, NLL, NASCAR and NBA and broadcasts live play-by-play games of the CFL, NHL, NFL and NBA. In addition, SIRIUS Satellite Radio is home to broadcasts of U.S. College Football, English Premier League and NASCAR.

In Canada, SIRIUS' automotive partners include Aston Martin, Audi, BMW, Chrysler, Dodge, Ford, Jaguar, Jeep, Land Rover, Lincoln, Mazda, Pana-Pacific,
Subaru, Volkswagen and Volvo.

For more information please visit: www.siriuscanada.ca

Labels: mazda, OEM, sirius, sirius canada

2/14/2007 12:19:00 PM

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T. Rowe Price Announces 8.6% Stake In XM

February 14, 2007

The filing date for institutional ownership closes tomorrow. Today, T. Rowe Price disclosed an 8.6% position in XM. As of today institutional ownership of XM stands at about 80%. reports from institutions are due by February 15th.

Labels: institutional ownership, t rowe price, xm

2/14/2007 11:22:00 AM

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XM Completes Sale/Leaseback Transaction On XM-4

February 14, 2007

Last week we reported that there was speculation regarding a sale/leaseback of XM-4. The note was part of an analyst report written by James Dix of Deutsche Bank, who broke the story to the street. Today, XM announced that they have completed the transaction. The move will bolster liquidity for XM.

On February 13, 2007, we entered into a sale-leaseback transaction with respect to the transponders on our XM-4 satellite, which was launched in October 2006 and placed into service during December 2006. This transaction was the result of months of extensive negotiations and preparation, and follows the receipt of the XM-4 in-orbit test reports in January and the placement last week of additional insurance on the XM-4 satellite required in connection with the transaction. XM received net proceeds of $288.5 million from the transaction, of which $44 million (inclusive of interest) was used to retire outstanding mortgages on our real property and the remainder of which provides additional liquidity available for working capital and general corporate purposes.

The transaction achieved our dual objectives of monetizing the tax benefits of XM-4 satellite ownership and cost-effectively enhancing our liquidity. The sale-leaseback transaction completes the recapitalization plan which we commenced in April of last year and was specifically provided for in the bond and credit facility agreements closed in May 2006.

Summary of the Transaction. Under the sale-leaseback arrangement, we sold the XM-4 transponders to a trust owned by Satellite Leasing (702-4) LLC for $288.5 million, representing the fair market value based on an appraisal performed by satellite consulting and lease appraisal firms. The purchase price for the XM-4 transponders was financed with a $57.7 million investment by the equity owner of the lessor, or owner participant, and $230.8 million from the sale of 10% senior secured notes by the lessor.

The lease term is nine years with an early buy-out option in year five and a buy-out option at the end of the term. The lease has minimal amortization during the first half of the lease term and will be recorded as a capital lease on our balance sheet.

Our operating subsidiary, XM Satellite Radio Inc., is leasing the transponders from the lessor for a term of nine years pursuant to a lease agreement. These lease payment obligations, which are unconditional and guaranteed by the parent company, XM Satellite Radio Holdings Inc., are senior unsecured obligations and rank equally in right of payment with existing and future senior unsecured obligations. Principal and interest payments on the notes are senior secured obligations of the lessor. The notes issued by the lessor are secured by a lien on the transponders, the lessor’s security interest in the XM-4 satellite, and subject to certain exceptions, the rights of the lessor under the lease, including the rights to receive base rent and other amounts payable by us under the lease.

Throughout the term of the lease, at any time when XM is not investment grade, we will provide to the owner participant credit support sufficient to cover the stipulated loss value of the equity at that time. To provide this credit support at the present time, we defeased the existing mortgages on our headquarters and data center properties in Washington, D.C. and put into place new mortgage liens on those properties in favor of the owner participant.

We will have full operational control over the transponders for the lease term, absent default. We will continue to own the XM-4 satellite itself, subject to an obligation to sell the satellite to the lessor for a nominal sum in the event that we do not repurchase the transponders at the end of the term.

We have an early buyout option in year five and a buy-out right at the end of the lease term, each at prices representing the fair market value based on an appraisal performed by satellite consulting and lease appraisal firms. We have other rights to purchase the transponders or the equity interest in the lessor, including if the owner participant becomes affiliated with a major competitor of XM and in situations which might otherwise involve adverse tax or accounting consequences. We also have rights to cause the lessor to effect a refinancing of the notes, and any interest savings from the refinancing would result in reduced lease payments.

We can be required to repurchase the transponders upon the occurrence of specified events, including an event of loss of the satellite (subject to our right to substitute another satellite meeting equivalent or better value and functionality tests), changes in law that impose a material regulatory burden on the owner participant, changes of control similar to those of our outstanding 9.75% Senior Notes due 2014 and events resulting in the absence of another holder (other than XM and its affiliates) of FCC satellite radio licenses in the frequency bands that can be served by the XM-4 satellite. We have agreed to provide indemnities in the event the owner participant shall lose or not be able to take certain tax positions relating to the transaction.

Labels: deutsche bank, sale-leaseback, xm, xm-4

2/14/2007 11:02:00 AM

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Seeking Alpha: The Importance Of "The Howard"

Life Without Howard? Not For Sirius
Posted on Feb 14th, 2007 with stocks: SIRI

Roger Ehrenberg submits: Sirius (SIRI) has always been a complicated company with a complicated story. First of all, you've got the blue-sky opportunity of satellite radio, which has lured in many only to see them washed away in a sea of red ink and missed expectations.
Then you've got the deal with Howard Stern, a mythic figure with the cult status of Steve Jobs and whose importance to the well-being of the Company (and its stock price) is a topic of endless conversation. Next you've got Mel Karmazin, yet another big personality in a small company with an agenda all his own. And finally you've got the technical issues of getting good information on Sirius that is not simply a parroting of mainstream media - because Sirius is not only a star and it's not only the name of a key character in the Harry Potter series (Sirius Black), it is an element of a wide variety of other notable search terms. This is when powerful investment-oriented vertical search tools come in handy...read more: here

Labels: howard stern, siri

2/14/2007 08:00:00 AM

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'The Howard' is Engaged

February 14th, 2007

What started off with a ~5am Channel Update, continued on with an interesting start to The Howard Stern Show (at 6am).

It's Official, The Howard is Engaged to Beth Ostrosky.

Howard claimed this would never happen ever again, but he admits to finally dropping the question. However, there is no date for the wedding bells.

It should be an interesting day on the Bubba the Lovesponge Show (3pm on Sirius Channel 101). Howard (and crew) visited Tampa in mid-January to be a part of Bubba's wedding.

Congratulations to Howard and Beth. Hopefully Howard will actually let Robin come to the wedding.

More via NewsTimesLive.
and via LAist

Labels: bubba, sirius, stern

2/14/2007 06:11:00 AM

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BusinessWeek: A NASCAR Comeback?

A Comeback for NASCAR?
New advertisers, broadcasters, and Toyota will help, but to reverse declining growth what NASCAR really needs is new viewers
by Douglas MacMillan and Matt Vella, BusinessWeek

A green flag means go this Sunday, Feb. 17, for drivers competing in the Daytona 500. But amid the roaring and smoking of the high-speed, high-performance race cars, NASCAR executives will be looking for something else: a significant rebound in ratings and viewership.
Last year saw a lag in attendance and a ratings downturn that left the sport in need of a comeback season. New high-profile advertisers, new broadcasting outlets, and Toyota's (TM) decision to participate for the first time could make that happen. But to truly attract large audiences once again, NASCAR officials say the sport must strike a balance between catering to existing fans and making new ones...

Despite this decline, NASCAR officials maintain that the sport remains attractive to fans and sponsors. Steve Phelps, NASCAR's chief marketing officer, says the sport's fan base has grown nearly 20% in the last decade, to 75 million in 2006. NASCAR-licensed merchandise, meanwhile, is worth $2 billion in sales annually. But because it's held privately, NASCAR—an acronym for the National Association for Stock Car Auto Racing—doesn't have to disclose its revenues or operating costs.
Downturn notwithstanding, NASCAR has managed to win new high-profile advertisers this year, including Bank of America (BAC) and Johnson & Johnson's (JNJ) Tylenol. It's also pushing ahead with ambitious new broadcasting ventures, thanks to two new partners: Sirius Satellite Radio (SIRI) and the ESPN network, which is back following a six year absence...

...NASCAR made another major media shift, from satellite radio provider XM Satellite Radio (XMSR) to its rival, Sirius. Sirius listeners will be able to tune in to every NASCAR race on the main NASCAR stations, as well as a related talk programs. On race days, Sirius subscribers will even be able to layer the in-car communications of their favorite driver with the main broadcast from the booth. "We're after the core audience, the fanatical fans who will see this programming as must-have," says Scott Greenstein, Sirius' president of entertainment & sports...read more: here

Labels: businessweek, nascar, sirius

2/14/2007 01:50:00 AM

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Tiki Barber Joins NBC's Today Show

Tiki Barber joins NBC to work at 'Today' show, analyze football
By DAVID BAUDERAP Television Writer

NEW YORK Former NFL running back and new "Today" show correspondent Tiki Barber said his offseason work at Fox News Channel made him recognize he had a passion for a career outside of sports.Barber also said his problems with New York Giants head coach Tom Coughlin had "started to take its toll on me."The just-retired NFL running back was formally introduced as an NBC Universal employee Tuesday. He'll contribute news and human interest stories to "Today," and he'll be an analyst on NBC's Sunday highlight show "Football Night in America" in the fall.
He spurned offers from Fox and ABC/Disney to take the NBC job."My dream has always been to be on the `Today' show," Barber said.Barber, 31, retired as a Pro Bowl running back, scoring a touchdown in the NFL all-star game last weekend. Barber and his disciplinarian coach had their rough patches, particularly when Barber said the Giants were outcoached after a playoff loss a season ago.Barber laid the groundwork for a broadcasting career while still active in the NFL. He was a correspondent for the Fox News Channel morning program "Fox & Friends," and has two programs on Sirius Satellite Radio, one on general topics and another on football that he does with his twin brother, Ronde Barber of the Tampa Bay Buccaneers....read more: here

Labels: nfl, sirius, tiki barber

2/14/2007 01:48:00 AM

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THE Canadian Factor

February 14, 2007

With the news from Sirius Canada being announced today, investors in Sirius Satellite Radio should begin to look more closely at the business north of the border. The reason is simple. There will come a day when Sirius Canada contributes to the bottom line of Sirius Satellite Radio, and given the fast start up north, that day may come sooner than many people realize. It wont be this quarter, and maybe not next quarter, but the day is coming. If 300,000 subscribers have an ARPU of $10 each, then Sirius Canada is bringing in $3,000,000 per month. As the base grows, the revenue will as well.

Consider that Sirius Canada did not have about 1 billion dollars worth of satellites to launch. Consider that the repeater network in Canada is quite small. Consider that the bulk of content is already paid for. Consider that the marketing efforts up north benefit greatly from what happens here in the U.S.

Simply stated, the operations costs of Sirius Canada are a stark difference from Sirius Satellite Radio stateside. Now think about the fact that Sirius Satellite Radio gets about half of the Sirius Canada pie.

Many analyst models do not even consider Sirius Canada in their projections. The costs are not big, and at this point neither is the revenue, but people should begin to think a couple of years down the road, and what the business north of the border will be contributing to the bottom line of this equity. Perhaps some early projections are now warranted.

The same would seem to hold true for XM satellite Radio, but their road to riches seems to be a bit further off at this point, and XM's ownership in the Canadian counterpart is not as substantial as Sirius’.

Some pretty interesting data was announced today, and it is compelling enough that it ought not be ignored. Since January 2006 Sirius Canada has garnered a 75% retail share according to NPD, and more impressively, brought in almost 80% in December of 2006. These statistics are quite telling. There seems to be an obvious choice being made by Canadian consumers. Even more note worthy is the fact that Sirius Canada has been the more expensively priced service during this time period (the services now have identical pricing for the first subscription).

There are several reasons that investors stateside should begin to watch the Canadian counterparts closely:

1. The services launched at virtually the same time, thus the subscriber comparison metric is not skewed.

2. The retail channel, according to NPD, is seeming to show a clear preference. How will advertisers react to this news? OEM's? potential on air talent?

3. The Canadian companies will be contributing to the bottom line of Sirius as well as XM at some point. The faster that happens, the faster a surprise in the revenue line will hit these stocks. XM Canada is publicly traded, and various reporting is required. In the case of Sirius Canada, it is private. The financials are not disclosed. This means that the Canadian factor will come as more of a surprise to the street when it happens.

For their part, XM Canada has announced several OEM deals in Canada, and similar to stateside claims a big advantage in that area. However, we have covered the perception vs. reality of the OEM world in the past, and that channel boils down to the number of installs, the cost of those installs, the take rate, and what kind of revenue these companies get to keep (revenue share). It comes down to whether retail fuels OEM, or whether OEM will be the dominating force. The answer to this type of question may well be already available. How many "Factory Installed I-Pods" have you seen? how many I-Pods come from retail?

In the end it boils down to one thing. Which company offers the content that consumers want?

Labels: npd, sirius, sirius canada, xm, xm canada

2/13/2007 11:55:00 PM

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Sirius Creates "Fans Choice"

February 13, 2007

SIRIUS Satellite Radio to Create "Fan's Choice" Broadcast for 2007 NASCAR NEXTEL Cup Series(TM) Races

Fans can vote online to determine which driver's in-car audio will air on SIRIUS
Additional channels to feature other top drivers based on the NASCAR NEXTEL Cup Series standings

NEW YORK, Feb. 13 /PRNewswire-FirstCall/ -- SIRIUS Satellite Radio (Nasdaq: SIRI - News), the Official Satellite Radio Partner of NASCAR, announced today that it will provide a "Fan's Choice" broadcast, in addition to the live race call for NASCAR NEXTEL Cup Series races in 2007, that will feature the driver-to-pit crew communications of a driver determined weekly by a fan vote.

Prior to every NASCAR NEXTEL Cup Series race, fans can log on to www.sirius.com/driverfeeds to vote for their favorite driver. The driver with the most votes will have his in-car audio broadcast on the "Fan's Choice" channel, which will air on SIRIUS channel 140 during that weekend's NASCAR NEXTEL Cup Series race.

Source: SIRIUS Satellite Radio

The "Fan's Choice" broadcast will air on one of up to ten additional channels that SIRIUS will devote to carrying the driver-to-crew communications of up to 10 different race teams for every NASCAR NEXTEL Cup Series race in 2007. The additional nine channels will carry the in-car audio of other drivers based on their place in the NASCAR NEXTEL Cup Series standings each week.

On each channel SIRIUS will combine the race broadcast with the driver-to- crew chatter, allowing fans to follow the overall race call and the in-car audio of a driver on a single channel throughout the race. Listeners will hear drivers and crew chiefs schedule pit stops and discuss strategy over audio of the overall race broadcast. When the team members are not on the radio the audio of the live race broadcast will come up allowing listeners to follow the entire race uninterrupted.

A lineup of drivers and their channel assignments will be available at www.sirius.com/driverfeeds prior to each race.

The live overall race broadcast for every NASCAR NEXTEL Cup Series, NASCAR Busch Series and NASCAR Craftsman Truck Series race will air on SIRIUS NASCAR Radio, channel 128. As the Official Satellite Radio Partner of NASCAR, SIRIUS broadcasts every NASCAR NEXTEL Cup Series, NASCAR Busch Series and NASCAR Craftsman Truck Series race live, carrying the broadcasts of Motor Racing Network (MRN), Performance Racing Network (PRN) and the IMS Radio Network's broadcast from Indianapolis Motor Speedway.

In addition to live race coverage, SIRIUS NASCAR Radio, the only 24/7 year-round radio channel dedicated to NASCAR, provides the most comprehensive, in-depth radio coverage of the sport with a lineup of exclusive daily talk shows providing up-to-the-minute news, expert analysis and exclusive interviews with NASCAR insiders.

Labels: fan ckoice, nascar, sirius

2/13/2007 11:03:00 PM

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Sirius Canada Passes 300,000 Subscribers

February 13, 2007

SIRIUS Canada Adds 100,000 New Subscribers Over Holiday Season

* SIRIUS Canada Surpasses 300,000 Paying Subscribers
* SIRIUS Leads Industry in Canada with 78 per cent Market Share

TORONTO, Feb. 13 /PRNewswire-FirstCall/ -- SIRIUS Canada Inc., Canada's fastest growing satellite radio provider with 110 full-time channels, announced today that it has surpassed 300,000 paying subscribers nationwide, with more than 100,000 of those subscribers joining since November 22, 2006.

Source: SIRIUS Satellite Radio

During the 2006 holiday season, more than 3,500 retail locations throughout Canada were fully stocked with SIRIUS' latest plug-and-play and portable radios including the Sportster 4 and cutting-edge Stiletto 100. According to independent retail tracking research provided by the NPD Group, SIRIUS was the preferred choice for satellite radio this holiday season with nearly 8 out of 10 satellite radio shoppers choosing SIRIUS in December. Since January 2006, SIRIUS has led the satellite radio industry in Canada with 75 per cent market share, within NPD's measured channels.*

"Surpassing 300,000 paying subscribers in such a short time confirms the demand for and strength of SIRIUS' programming, signal coverage, and innovative products," said Mark Redmond, President and CEO, SIRIUS Canada Inc. "SIRIUS' depth and breadth of programming resonates with Canadians and we are proud to be the country's undisputed satellite radio leader. This is a tremendous accomplishment for SIRIUS Canada and as we continue to build our business and extend our offerings, we look forward to sharing in future success with our customers and our retail and automotive partners."

In addition to success at retail, SIRIUS continues to partner with leading automotive brands across Canada. More than 150 vehicle models are expected to be available in 2007 with SIRIUS Satellite Radio receivers either factory or dealer-installed in Audi, Aston Martin, BMW, Chrysler, Dodge, Ford, Jaguar, Jeep, Land Rover, Lincoln, Subaru, Volkswagen and Volvo vehicles

SIRIUS maintains its leadership in the Canadian satellite radio market with an extensive, full-time 110-channel lineup offering the very best in news, talk, sports and commercial-free music programming. With exclusive and unique entertainment programming ranging from Blue Collar Comedy and NASCAR Radio to the recently added Siriusly Sinatra and Metropolitan Opera Radio channels, SIRIUS offers an unrivaled entertainment experience.

In addition, through exclusive sports partnerships with North America's major professional sports leagues including CFL, NFL, NLL, NBA and NASCAR, SIRIUS also offers fans the most in-depth sports coverage anytime, anywhere.

About SIRIUS Canada

From broadcast studios in Vancouver, Toronto, Montreal and New York, SIRIUS Canada delivers 110 premium channels of the best music, sports, news, talk and entertainment programming. With a total of 65 music channels - the most in Canada - SIRIUS is the original and only home of 100% commercial-free music and offers the broadest range of Canadian content on satellite radio with 11 English and French channels. SIRIUS is Canada's satellite radio sports leader and is the Official Satellite Radio Partner of the CFL, NHL, NFL, NLL, NBA and NASCAR and broadcasts live play-by-play games of the CFL, NHL, NFL, NLL and NBA. In addition, SIRIUS Satellite Radio is home to broadcasts of U.S. College Football and English Premier League Soccer.

In Canada, SIRIUS' automotive partners include Audi, Aston Martin, BMW, Chrysler, Dodge, Ford, Jaguar, Jeep, Land Rover, MINI, Lincoln, Pana-Pacific, Subaru, Volkswagen and Volvo.

For additional details on SIRIUS Canada, please visit: www.siriuscanada.ca

* NPD-measured channels do not include certain retail channels like Club
Stores or OEM or Aftermarket Installers; for more information see
www.npd.com.

Labels: npd, sirius, sirius canada, subscribers

2/13/2007 10:53:00 PM

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Howard Stern Declares Himself "The Howard" (Part 2)

February 13th, 2007

To continue on from yesterday, a story regarding the 'name change' has shown up on the Internet (via Associated Content).

"In the wake of Anna Nicole Smith's death and increasing media attention on her partner and lawyer Howard K. Stern, controversial Sirius DJ Howard Stern asked listeners today to stop calling him by his full name.

The lawyer Stern has been frequently confused with the disc jockey in recent weeks, both in print and in broadcasts.

While the disc jockey did admit that he appreciated the free press to an extent, he didn't want to be confused with the other Howard Stern, and was angered when he heard some news outlets dropping the "K." from the lawyer Stern's name during reports.

"I don't want to be associated with that retard," Stern said on his daily radio show when announcing the change."

More HERE (via Associated Content).

Labels: sirius, stern

2/13/2007 09:20:00 AM

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Sirius Announces New Channel Lineup

Labels: channels, sirius

2/13/2007 05:59:00 AM

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Sirius To Air Live Madonna Interview

Labels: content, madonna, sirius

2/13/2007 05:57:00 AM

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The Motley Fool On SIRI, XMSR & AAPL

Date Sirius, Marry Apple, Kill XM
By Rick Aristotle Munarriz, February 12, 2007, The Motley Fool

By now, you've probably come across the popular game in which three celebrities are named. That's where the fun starts. You must single one out for a one-night stand. Another will be one that you wouldn't mind marrying. The third? Unfortunately, you have to kill that one.
The game was a running gag in last week's episode of 30 Rock. It has also been an occasional feature on morning radio shows like Howard Stern's. Several websites also offer online version of the childish game. The language of the three choices -- particularly the fling option -- can get pretty saucy out there.
This is a family-friendly site, so I'm going with "date" for that category. This is also an investing site, so I'm replacing celebrities with stocks. In honor of Valentine's Day, I'll be exploring this game with three related companies every day of the week.
Let's get started.
Sirius, Apple, and XMI decided to kick things off by taking a closer look at three stocks that are reshaping the way we listen to music. Apple (Nasdaq: AAPL) is revolutionizing digital media through its iPod. XM (Nasdaq: XMSR) and Sirius (Nasdaq: SIRI) are winning over terrestrial radio listeners with their satellite radio programming...read more: here

2/12/2007 06:15:00 PM

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The SEC Asleep At The Wheel...?

Just last week, Goldman Sachs (which operates like a hedge fund, and we all know that the SEC is scrutinizing "front running" by hedge funds) disclosed a 6.4% stake in XMSR. The next thing we know, Goldman is increasing the price target on XMSR to $15.

Live In Play, XMSR XM Satellite: Satellite radio fundamentals remain challenged and will hit more speed bumps near term - Goldman (13.44 )
Goldman Sachs believes satellite radio fundamentals remain challenged and will hit more speed bumps near term before entering a two- to three-year window of opportunity to solidify a position in consumer-supported media. Firm says with consensus forecasts still too high, they think XMSR and SIRI valuations will remain volatile. Firm notes that widespread merger speculation in the media, in part fueled by management commentary, remains the key driver of stock prices. Firm thinks both equity valuations already factor in some of the likely synergies of a merger. With merger approvals uncertain, they think investors need to weigh current valuations against the sum of expected values of a merged entity, with consideration paid to what they find to be an irrational value transfer at a 50/50 split. Firm raises their XMSR tgt to $15 from $11 and cuts their SIRI tgt to $2.75 from $3.50.

2/12/2007 03:05:00 PM

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sirius Announces Conference Call

February 12, 2007

Company to Webcast Earnings Call for Investors and Media

NEW YORK, Feb. 12 /PRNewswire-FirstCall/ -- SIRIUS Satellite Radio (Nasdaq: SIRI - News) today announced that it plans to release 2006 financial and operating results on February 27, 2007.

SIRIUS also plans to hold a conference call at 8:00 am ET to discuss these results. Investors and the press can listen to the conference call via the company's website, http://www.sirius.com, and on its satellite radio service by tuning to SIRIUS Channel 122.

Source: SIRIUS

· Click Here to Download Image


A replay of the call will be available on the company's website.

Labels: conference call, sirius

2/12/2007 12:24:00 PM

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XM Announes Conference Call

February 12, 2007

XM satellite radio has announced their conference call for Q4 2006 and full year 2006.

XM Satellite Radio has scheduled a conference call for Monday, February 26, 2007, at 10:00 AM ET to announce and discuss its fourth quarter and full year 2006 financial results. Prior to the call, XM Radio's fourth quarter and full year 2006 results will be posted to the Company's website at http://www.xmradio.com/ and released to PR Newswire and First Call.

To listen to the conference call via telephone, please call one of the following numbers approximately 10 minutes prior to the planned start of the call.

Call-in number: (877) 265-5808
Local call-in number: (706) 679-7931


The conference call can also be accessed through a live webcast on the Company's website at http://www.xmradio.com/ (click on "Investor Info" link at the bottom of the page). The webcast of the call will also be archived on the Company's website.

If you are unable to participate in the scheduled call, a replay of the conference call will be available after 11 a.m. ET on Monday, February 26, 2007 until May 26, 2007.

Playback Numbers: (800) 642-1687
Local playback number: (706) 645-9291
Conference ID#: 9029291

Labels: xm conference call

2/12/2007 11:00:00 AM

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Howard Stern Declares Himself "The Howard"

February 12th, 2007

In an effort to remove confusion as result of the Anna Nicole Smith death, Howard Stern has requested that people from now forward refer to him as "The Howard". His feeling is that the media continues to forget the "K" in Howard K Stern, the lawyer and potential father of Anna's child. "The Howard" requested an AP writer submit an article completing this name change.

About.com has made 11 Major Differences Between the Two Howard Sterns.

Will he 'rename' to "King of All Media" when his Patent Application goes through? Time will tell.

Part 2

Labels: sirius, stern

2/12/2007 09:35:00 AM

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EMI May Drop Copy Protection

EMI Considers Dropping Copy Protection
February 9, 2007, www.fmqb.com

The fallout continues from Steve Jobs' declaration earlier this week that the music industry should put an end to its usage of copy protection software on digital music. Multiple reports are suggesting that EMI Group is debating changing over to selling its music as unprotected MP3s. Sources tell Reuters and the Wall Street Journal that the label is holding talks with digital retailers about its entire catalog being sold in MP3 format, as opposed to the various copy protected formats of the different online stores.
According to the WSJ, EMI has been in talks with RealNetworks, eMusic, Music Net and MTV about the removal of copy protection. However, the paper's sources said that EMI could abandon the proposed changes before they take place...read more: here

2/11/2007 09:25:00 PM

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Mobile Industry: Content Is Key

Content is key for mobile industry
By Maija Palmer, IT Correspondent, February 12 2007 00:43, The Financial Times

Leaders of telecoms, media and technology companies are gathered this week in Barcelona for the mobile industry’s biggest event of the year.
Among the 60,000 visitors and 1,300 exhibitors at the 3GSM World Congress will be heavyweight keynote speakers such as Vodafone’s Arun Sarin and Carl-Eric Svanberg of Ericsson.

But the speakers will not just come from the telecommunications sector. There will also be luminaries from the entertainment industry such as Warner Music’s Edgar Bronfman.
As usual, a key theme at the event will be how to increase usage of third-generation mobile phone networks, so that operators will be able to recoup the billions of pounds they spent on 3G licences at the beginning of the decade...read more: here

2/11/2007 08:52:00 PM

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Hedge Funds: Finance Ministers To Srutinize Sector, Lax Oversight And Under-Regulation Targeted

Economic Powers to Study Growing Influence of Hedge Funds
By CARTER DOUGHERTY, Feb 11, 2007, The New York Times

ESSEN, Germany, Feb. 10 — Finance ministers from the world’s leading economies put the $1.4 trillion hedge fund industry firmly on the international policy agenda on Saturday, saying they would scrutinize the sector closely with an eye toward encouraging more self-regulation.
Representatives from the Group of 7 nations, who met in the industrial center of the host country, Germany, issued a statement saying that the practices of hedge funds, which have drawn growing concern from financial policy makers over the last few years, have “become more complex and challenging” in light of the industry’s prominence and volatility.
“Given the strong growth of the hedge fund industry and the instruments they trade, we need to be vigilant,” the ministers said in their statement. “We therefore agreed to further pursue the issue.”
Hedge funds, which manage vast pools of capital and operate largely outside regulatory scrutiny, have grown to become some of the largest and most important players in markets around the world, particularly on Wall Street and in London. On Friday, the Fortress Investment Group, the first hedge fund in the United States to go public, saw its shares rise 67.6 percent on the first day of trading...read more: here

2/11/2007 07:47:00 AM

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Sirius Files Patent For Improved Antenna

The "eagle eyes" over at Satellite Radio TechWorld spotted this one:

Sirius Patents Antenna for Improved Reception
Sirius recently patented an improved satellite radio antenna. It is very rare that one sees a new Sirius patent. XM has nearly 4 times the number of patents and applications. We almost missed this one.

United States Patent , 7,167,128, Akturan, January 23, 2007
Modular patch antenna providing antenna gain direction selection capability

Abstract
A modular patch antenna includes a first module and a second module. The first module comprises a first metal or metal plated radiating layer, a second, middle dielectric layer, and a third metal or metal plated ground layer; the second module comprises a frame that attaches to or fits onto the periphery of the first module and comprises a dielectric layer, or the same three layers as the first module. The first module provides favorable satellite signal reception. By superimposing the second module around the first module, the antenna provides improved terrestrial signal reception. This capability could apply to Satellite Digital Audio Radio Systems systems. This provides capability of changing the antenna gain beam direction towards the desired signals at a user's location. Users of such systems can perform this function manually...read more: here

2/11/2007 07:35:00 AM

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NASCAR: Nextel Cup Kicks Off This Weekend

NASCAR Looks for Big Season
2/9/2007 2:25:22

Race fans will have to buckle up for a season that promises to be like nothing ever seen before.With the mandated Car of Tomorrow, changes to the Chase for the championship, Toyota's arrival, ESPN's return and the introduction of former Formula One driver Juan Pablo Montoya, 2007 will prove this ain't your Daddy's NASCAR. This season will be a pivotal one for NASCAR, which looks to rebound after a mediocre 2006 that saw television ratings slip and made many wonder if the sport had reached its plateau. It starts this weekend at Daytona International Speedway, where the best of the Nextel Cup Series will kick-start the season with Saturday night's exhibition Budweiser Shootout. Preparations begin the very next day for the February 18th season-opening Daytona 500...read more: here

2/09/2007 03:38:00 PM

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"At The Races And Beyond" Moving To Sirius

New Channel for 'At the Races and Beyond'
by Blood-Horse Staff, 2/9/2007 1:42:10 PM

The Thoroughbred Racing Radio’s Network’s "At the Races and Beyond" program will be moving to SIRIUS Satellite Radio channel 126 on Wednesday, Feb. 14, executive producer and co-host John Perrotta announced Friday. The racing information/talk program, which currently airs on SIRIUS channel 125, may be heard live Mondays through Fridays from 4-7 p.m. EST, with replays at 1-4 a.m. EST. The live show, archived segments and podcasts are also available online at Attheracesandbeyond.com....read more: here

2/09/2007 03:34:00 PM

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RIAA Responds To Steve Job's DRM Comments

Industry Responds To Jobs' Copy Protection Comments
February 8, 2007, www.fmqb.com

Earlier this week, Apple CEO Steve Jobs posted a lengthy essay on his company's Web site, suggesting the best way for the music industry to deal with copy protection on digital music is to do away with it altogether. Now, the RIAA and other industry voices are speaking up in reply to Jobs.
RIAA head Mitch Bainwol suggested in a statement that Apple should open its own FairPlay digital rights management (DRM) software to its competitors, rather get rid of all copy-protection. "We all want to see this marketplace work and for fans to enjoy the music they have lawfully bought on various devices or services. The issue is how. One way to achieve it was outlined by Steve Jobs in his post - for Apple to license its DRM to other technology companies. We think that's a great solution. Obviously, it would need to be done right and in the marketplace - but we have no doubt that a technology company as sophisticated and smart as Apple could work with the music community to make that happen. This would enable the interoperability that we have been urging in the marketplace for a very long time.” Bainwol said.
An anonymous, high-level industry executive told the New York Post that he believes "Jobs doesn't care about the industry at all. He uses us." John Kennedy, Chairman of the IFPI (International Federation of the Phonographic Industry) told the Financial Times that he thinks Jobs is "expressing some frustration at being the bad guy...and people like the Norwegian government beating him up, and he’s taking it out on us."...read more: here

2/09/2007 12:17:00 PM

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Dimarc Radio Executives Have Left Google

Live In Play, www.briefing.com, 09-Feb-07, 12:04
GOOG Google says Dmarc radio executives have left co - Bloomberg (467.90 -3.13)
update shortly...

2/09/2007 12:15:00 PM

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