(Credit:
Steve Guttenberg)
No matter how you look at it, Sirius XM Satellite Radio is in sad shape. The stock has been stuck around 11 cents for months, and now there's talk about bankruptcy.
I don't get it, the satellite company claims 19 million subscribers, and if they were paying the same rate as I do, $12.95 a month, that works out to close to $3 billion a year in income. They also have ads on all the nonmusic channels, which have to be generating income as well. Oh, wouldn't you think the ads on Howard Stern's show make a load of dough for Sirius XM?
I've heard that EchoStar, a maker of TV set-top boxes, is trying to take over the company. but Sirius XM is holding tight.
So if Howard Stern loves Sirius XM so much, why doesn't he buy it? If he can't swing it solo, maybe he could team up with other Sirius XM heavyweights like Oprah and Martha Stewart to keep the satellites afloat.
Stern's fans are a rabid group, and they believe Stern is in large part for the company's "success." Hey, if he's not interested in taking over the debt, maybe he could work for free for the duration of his contract. Relieved of the burden of paying Stern's hefty salary would free up capital and keep the company out of bankruptcy. He's already made hundreds of millions of dollars from Sirius; isn't it time to give something back?
Everyday working stiffs are being forced to accept givebacks and pay cuts to help save the companies they work for. Isn't it time that silly rich stars like Stern do the same? If he refuses to work for free, he could at least show up more often--Stern works four days a week--and gets 10 (!) weeks of vacation a year!
It seems like the Sirius-XM merger been dragging on for years, and both sides are eager to get it done, but what would I get out of it? I've been a happy Sirius subscriber for years. I love the commercial-free music channels, and the uninhibited talk channels are hugely entertaining. At least maybe Sirius' sound quality will get closer to XM's--it's always sounded a little better.
They still need approval from the Federal Communications Commission before the deal is done. If you ask me, it seems anticompetitive to let the only two satellite-radio companies in the U.S. merge. Both companies' subscriber bases are at record highs, but both claim they need the merger to survive. They've both far exceeded the numbers they claimed they needed to be profitable when they started.
Sirius must be overpaying Howard Stern--because even with all the new subscribers he brought them, they're still losing money. He's sucking the profits out of Sirius--perhaps Stern should consider a pay cut to help them out? He can afford it more than his listeners.
What does the merger mean for satellite radio subscribers? There's a lot of duplication between Sirius and XM's programming so we'll surely lose some of our favorite programs or channels. There will no doubt be winners and losers in the reshuffle.
But without Sirius-XM competition how long will the merged company wait before they stick it to the subscribers and jack up the rates? Yes, some say the merged company will still be competing with broadcast radio, but isn't that like saying movie theater ticket prices are somehow kept in check by DVD prices? Somebody's gotta pay for the Sirius-XM merger, and I have a feeling that somebody is us.
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