XM / Sirius Satellite Radio merger is a done deal?

[Toddzilla]

It seems to me the difference between Sirius and XM were of business philosophy. XM struck me as a company run my radio/music people, which drove the company to a much better quality of programming but led to business failure. Sirius on the other hand seemed to be run by businessmen, leading to a more well-run business financially, but the quality of the music suffered.

Since the takeover, I'm very disappointed in the Sirius music channels that replaced their XM counterparts - the playlists seem smaller, there is 100x as much jock chatter (shut up and play music for chrissakes), and niche music channels - Fine Tuning, Fungus, The Rhyme - have been replaced with asinine aritst-based channels - Jimmy Buffet Channel, The Bruce Springsteen Channel, The Elvis Channel.

If the merger had resulted in the Sirius board running the business side and the XM people running the programming, it would be the perfect medium.

Still, as bad is it may get, it is a zillion times better than terrestrial radio.

[rjolley]

I think that's a very accurate assessment. The Sirius version of the XM stations I listened to are not as good for those reasons. I'm hoping they'll continue to move towards XM's programming style, as the complaints about the merger all tend to be in this vein.

One good thing, The Rhyme's true Sirius equivalent, Backspin, is due back on Jan 15th. Hopefully, it'll lean more towards The Rhyme's programming.

[Cringer]

SiriusXM is taking advantage of one thing the government never said they could increase prices on. What has always been free online listening with your radio account is going away. Starting in March you have to pay $2.99 a month to listen online.

Seeing this actually reminded me to cancel the account today for my broken radio. We had tried to find a refurbished unit to replace it had had not had any luck for a couple of months. When I called to cancel they gave me 2 months free (put the account on hold as they call it) and pointed out they now have refurbished radios in stock again. We ordered a radio, still got two free months (only $7 when you look closely, but 2 free months sounds nice), and activation will be free since it replaces my broken radio. On top of that, best customer service I have had with any company in a long time. They will out source it any day now I am sure.

[Maple Leafs]

Originally Posted by Cringer

SiriusXM is taking advantage of one thing the government never said they could increase prices on. What has always been free online listening with your radio account is going away. Starting in March you have to pay $2.99 a month to listen online.

Crap.

Wonder if this will apply to XM in Canada too, since the companies aren't technically merged here yet (I think).

[Cringer]

Originally Posted by Maple Leafs

Crap.

Wonder if this will apply to XM in Canada too, since the companies aren't technically merged here yet (I think).

I had a message pop up when I went to sign in to the online listening. If you are not getting that I am guessing you will be ok. Don't quote me on that though.

[JonInMiddleGA]

Originally Posted by Toddzilla

and niche music channels - Fine Tuning, Fungus, The Rhyme - have been replaced with asinine aritst-based channels - Jimmy Buffet Channel, The Bruce Springsteen Channel, The Elvis Channel.

I imagine they felt like they had to do something when last checked virtually no one was listening to those you mentioned.

http://www.orbitcast.com/archives/Sa...A07_P12%2B.pdf

-- Fungus averaged 600 listeners per quarter hour, only cumed (sampled at all) by 29,100
-- Fine Tuning 1200 listeners AQH, cumed 39,200
-- The Rhyme 1500 AQH, cumed 95,000

To put that in some perspective, CineMagic had a 1300 AQH & a 65,500 cume and the Oprah channel had a 3500 AQH with 120,500 cume.

Or to put it in even more relevant perspective, Sirius had 3,700 listeners AQH & 137,800 cume for SR 13 Elvis Radio. And 4,000 & 4,200 AQH for Radio Margaritaville & the Grateful Dead channel respectively. Read that one more time: Elvis f'n radio had more listeners than all three of those you mentioned combined.

Any wonder they looked to make a change?

[Cringer]

Originally Posted by JonInMiddleGA

I imagine they felt like they had to do something when last checked virtually no one was listening to those you mentioned.

http://www.orbitcast.com/archives/Sa...A07_P12%2B.pdf

-- Fungus averaged 600 listeners per quarter hour, only cumed (sampled at all) by 29,100
-- Fine Tuning 1200 listeners AQH, cumed 39,200
-- The Rhyme 1500 AQH, cumed 95,000

To put that in some perspective, CineMagic had a 1300 AQH & a 65,500 cume and the Oprah channel had a 3500 AQH with 120,500 cume.

Or to put it in even more relevant perspective, Sirius had 3,700 listeners AQH & 137,800 cume for SR 13 Elvis Radio. And 4,000 & 4,200 AQH for Radio Margaritaville & the Grateful Dead channel respectively. Read that one more time: Elvis f'n radio had more listeners than all three of those you mentioned combined.

Any wonder they looked to make a change?

Great link, thanks.

Sirius' Punk channel had 2000 AQH on that report, almost twice the number of Underground Garage. They killed the punk channel though. Bastards.

[Maple Leafs]

Originally Posted by Cringer

Don't quote me on that though.

Don't tell me what to do.

[Cringer]

I saw that one coming.

[Bearcat729]

Saw this on digg. Sounds interesting at least.

http://www.fool.com/investing/genera...ts-sirius.aspx

Apple Gets Sirius

By Rick Aristotle Munarriz
January 28, 2009 | Comments (6)

Recs
32

The long-anticipated marriage of Apple's (Nasdaq: AAPL) iPhone and Sirius XM Radio (Nasdaq: SIRI) is coming, according to Orbitcast.

Several unnamed sources are telling the satellite radio news site that the uSirius Starplayr program is being submitted to Apple over the weekend. The third-party application will then be just a head nod away from its official release through Apple's App Store.

Is it too little, too late?

Online streaming has been a free perk to paying Sirius XM subscribers, but that is likely to change. Several reports indicate that the company plans to begin charging an additional $2.99 a month for the service -- as it upgrades the audio quality -- in March.

Having a home in Apple's storefront is huge, but will consumers pay up? There are already plenty of free programs out there, including Pandora, Slacker, Time Warner's (NYSE: TWX) AOL Music, and CBS' (NYSE: CBS) Last.fm.

Naturally, there is plenty at stake here. If Sirius XM is able to deliver its programming digitally, it will mean fewer receivers to subsidize. Streaming costs aren't cheap, but this can certainly be an incrementally profitable offering for Sirius if so many other companies are giving it away. Several years from now, maybe even costly satellites and signal repeaters won't be necessary. The downside there, of course, is that a level playing field will make things more competitive for Sirius XM.

Either way, the real crime here is that Sirius XM didn't come to market with its own App Store program first. The ability to reach every iPhone user and any iPod Touch owner with a steady Wi-Fi connection is ridiculous to ignore.

Even when big brands stumble in the App Store -- like Chipotle Mexican Grill's (NYSE: CMG) (NYSE: CMG-B) short-lived mobile-ordering program -- it's important to see companies roll up their sleeves to reach growing audiences.

Kudos to Starplayr if it does hit the market next month. Shame on Sirius XM for not getting there first.

[Cringer]

Shame on SiriusXM? They haven't been SiriusXM very long. I know Sirius by itself has been rumored to be working out deals with Apple for years with nothing ever working. I am sure XM was trying to do the same. This might be a case where the merger helped them.

[Maple Leafs]

Sirius one of the 15 companies most likely to go bankrupt this year?

Sirius Satellite Radio. (SIRI - parent company; about 1,000 employees; stock down 96%). The music rocks, but satellite radio has yet to be profitable, and huge contracts for performers like Howard Stern are looking unsustainable. Sirius is one of two satellite-radio services owned by parent company Sirius XM, which was formed when Sirius and XM merged last year. So far, the merger hasn't generated the savings needed to make the company profitable, and Moody's thinks there's a "high likelihood" that Sirius will fail to repay or refinance its debt in 2009. One outcome could be a takeover, at distressed prices, by other firms active in the satellite business.

15 Companies That Might Not Survive 2009 - Yahoo! Finance

[Cringer]

Some interesting backstory on companies on that list. I checked it out because I wanted to see if they named names on who would take over Sirius. On Howard Stern right now when I turned it on they were finishing a conversation about some EchoStar guy wanting to buy it. I missed the details though and only caught the comments about the guy enforcing a cheap business plan.....share hotel rooms, etc.

[Cringer]

I found some details.

Report: Sirius XM Rejected Takeover Bid


NEW YORK -- February 9, 2009: The Wall Street Journal, citing "people familiar with the situation," says satellite broadcast mogul Charles Ergen made an unsolicited offer late last year to take control of Sirius XM Radio and was rejected. The proposal, WSJ reports, was for Ergen's EchoStar or Dish Network to inject enough capital into Sirius XM for it to meet its debt obligations and avoid bankruptcy. Though that offer was rejected, the paper reported last week that EchoStart has been buying up Sirius XM debt with a possible eye to a takeover.
Ergen "believes that satellite radio would complement his television operation," the WSJ said, and isn't trying to force Sirius XM into bankruptcy to acquire it more cheaply. But, says the paper, "In discussions with investors last week, Mr. Karmazin said that unless he could raise $175 million, he would be faced with one of two options: having Sirius file for bankruptcy or cutting a deal with Mr. Ergen. The bankruptcy option probably would be the least attractive for shareholders."

[Logan]

Probably?

[rowech]

So would that mean XM goes too?

[Cringer]

Same company.

[JonInMiddleGA]

I saw the Charlie Ergen story for the first time about a week or so ago, meant to mention it here but never got around to it. He's not particularly known for playing all that well with others so if he decides he really wants a deal, making one happen one way or another wouldn't surprise me at all.

[rowech]

Originally Posted by Cringer

Same company.

I understand but the article made it seem that they would treat Sirus separate from the XM.

[cooleyvol]

The merger ruined my favorite channel (XM12 XCountry) turned into Outlaw Country with foul mouthed DJs such as Mojo Nixon. Playlist is NOT NEAR the same, substituting acts like Cross Canadian Ragweed and Reckless Kelly with George Jones and Hank Sr.

[Cringer]

Originally Posted by rowech

I understand but the article made it seem that they would treat Sirus separate from the XM.

Sirius XM is often just referred to as Sirius now since the merger, especially since many consider it as Sirius really just took over XM.

[molson]

I wonder if these are the last days of Howard Stern. You'd think they'd try to renegotiate that contract and send him on his way during a bankruptcy. Though that would likely cause a partial subscriber exodus.

[rowech]

That'll be unfortunate to lose that from our cars.

[rkmsuf]

stern is probably toast if the direct tv guy takes over. that guy runs a tight ship.

if that happens stern should just retire. the show would be lousy going back to terrestrial radio.

[Cringer]

I don't think getting rid of Stern is an option for them actually. His two channels are the most listened to channels on satellite radio, and it's not even close from the last numbers I saw. You would have a large drop in subscriptions. I also remember them doing the math back in his first year on Sirius and how the number of people who signed up in the first 6-12 months basically offset his contract. Not sure if that's accurate but that is what I remember them saying.

I would think dumping contracts like Oprah would do them more good. $50 million and she is on the air 1/2 hour a week. Sirius is also in the process of bringing in more money by charging for the internet listening, bumping up the price of 2nd/3rd subscriptions, or getting people to lock in current prices by paying upfront for 12 months service or more. From what I heard today on Sirius, they are now operating at a profit. That could be BS, it was a comment from Robert Kraft and nothing else backed it up but it wouldn't surprise me with the changes lately. Their big problem is the debt and not being able to pay it off RIGHT NOW.

[rkmsuf]

Originally Posted by Cringer

I don't think getting rid of Stern is an option for them actually. His two channels are the most listened to channels on satellite radio, and it's not even close from the last numbers I saw. You would have a large drop in subscriptions. I also remember them doing the math back in his first year on Sirius and how the number of people who signed up in the first 6-12 months basically offset his contract. Not sure if that's accurate but that is what I remember them saying.

I would think dumping contracts like Oprah would do them more good. $50 million and she is on the air 1/2 hour a week. Sirius is also in the process of bringing in more money by charging for the internet listening, bumping up the price of 2nd/3rd subscriptions, or getting people to lock in current prices by paying upfront for 12 months service or more. From what I heard today on Sirius, they are now operating at a profit. That could be BS, it was a comment from Robert Kraft and nothing else backed it up but it wouldn't surprise me with the changes lately. Their big problem is the debt and not being able to pay it off RIGHT NOW.

Depends on what kind of deal ergen gets on the debt I would think as to whether he continues on with it. right now he has sirius backed into a bit of a corner.

[JonInMiddleGA]

Originally Posted by Cringer

I also remember them doing the math back in his first year on Sirius and how the number of people who signed up in the first 6-12 months basically offset his contract. Not sure if that's accurate but that is what I remember them saying.

I seem to remember some claims like that as well, but I was never able to come close to duplicating that math. In fact, I was never able to come up with any math that figured them even recovering half of his cost unless you took their pie in the sky projections & figured on an unrealistically high retention rate. There was a relative rush for signups when he signed & launched but their retention rate was lousy, so it's not a pure gain over the long haul, there's erosion.

[Samdari]

Originally Posted by molson

I wonder if these are the last days of Howard Stern. You'd think they'd try to renegotiate that contract and send him on his way during a bankruptcy. Though that would likely cause a partial subscriber exodus.

An incredible amount of his much reported windfall was in stock.

Makes the 200 million or whatever it was worth like $50.

[rkmsuf]

Originally Posted by JonInMiddleGA

I seem to remember some claims like that as well, but I was never able to come close to duplicating that math. In fact, I was never able to come up with any math that figured them even recovering half of his cost unless you took their pie in the sky projections & figured on an unrealistically high retention rate. There was a relative rush for signups when he signed & launched but their retention rate was lousy, so it's not a pure gain over the long haul, there's erosion.

right but they went from around 2 million subscribers to 6 million post howard. are you saying that the 4 million gain was funny math and just churn?

and now they have about 20 million with both companies. assuming some efficiencies with the merge it's conceivable they are cash flow positive.

[JonInMiddleGA]

Originally Posted by rkmsuf

right but they went from around 2 million subscribers to 6 million post howard. are you saying that the 4 million gain was funny math and just churn?

A large chunk of it was just that, including expiring "subscriptions" that came with vehicle sales but have an atrocious take rate and with counting subscriptions assigned to cars that haven't even sold. Sirius accounting methods have always left a lot to be desired, considerably worse in that regard than XM.

Was there growth? I don't doubt it. Was the portion attributable to Stern worth what they spent to get it? Not even close by any reasonable math I've seen yet.

[rkmsuf]

Originally Posted by JonInMiddleGA

A large chunk of it was just that, including expiring "subscriptions" that came with vehicle sales but have an atrocious take rate and with counting subscriptions assigned to cars that haven't even sold. Sirius accounting methods have always left a lot to be desired, considerably worse in that regard than XM.

Was there growth? I don't doubt it. Was the portion attributable to Stern worth what they spent to get it? Not even close by any reasonable math I've seen yet.

interesting. the company line has always been that the subscriber growth more than pays for stern. I guess the ultimate point is what their cash flow is now.

[JonInMiddleGA]

Originally Posted by rkmsuf

I guess the ultimate point is what their cash flow is now.

I really don't know if anyone other than Mel and a few of his highest ranking accountants knows for sure. The financials sure get muddled during the merger and between the revenue stream from the carmakers seeming like an iffy proposition uncertain retention figures during an economic downturn, and most of all no idea what sort of accounting method they're going to use to report on the combined entity ... well, you get the idea.

[molson]

Originally Posted by Samdari

An incredible amount of his much reported windfall was in stock.

Makes the 200 million or whatever it was worth like $50.

The $500 million was the 5-year budget for the show, including Stern's salary.

Stock options were all in addition to that

[Samdari]

Originally Posted by molson

The $500 million was the 5-year budget for the show, including Stern's salary.

Stock options were all in addition to that

The stories I read when he was signed said that he only got 20 million in cash, the rest in stock.

[JonInMiddleGA]

Mel is saved, at least temporarily, by a $530 million loan from Liberty Media., who takes 40% of the common stock and is supposed to get 15% interest on between now and December 2012 repayment. Times are tough?

My Way News - Liberty Media deal staves off Sirius bankruptcy

NEW YORK (AP) - Facing a likely bankruptcy, Sirius XM Radio Inc. (SIRI) (SIRI) found a savior in Liberty Media Corp., which will lend $530 million to the satellite radio provider and block a bid for control that had been waged by a rival both companies share: Dish Network Corp. (DISH) (DISH) CEO Charlie Ergen.

Sirius had warned it could file for bankruptcy as early as Tuesday if it could not successfully negotiate with its debt holders.

Sirius XM Radio has 20 million subscribers who use the service to listen to sports, music and talk, including Howard Stern's show, which Sirius landed with a five-year, $500 million contract that could have been terminated in a bankruptcy.

The company found itself on the brink as credit markets dried up and auto sales plunged - a critical factor for Sirius because many new subscribers buy the service in package offers with cars and trucks.

The crisis brought Sirius Chief Executive Mel Karmazin into a standoff with Ergen, who bought up much of the batch of debt that was coming due Tuesday and offered capital infusions and a restructuring of the loans in return for control of the company.

That would likely have meant Karmazin's ouster, but he appears to have found an alternative - in Liberty Chairman John Malone - in time to stave off a Chapter 11 filing.

Karmazin and Ergen have squabbled before, including when Karmazin headed Viacom Inc. (VIAB) and fought with Dish over the fees for carrying Viacom channels. Malone is also a rival of Ergen's, since Liberty controls satellite TV provider DirecTV Group Inc., which competes with Ergen's Dish.

However, Liberty said its deal with Sirius will not be made by its Liberty Entertainment unit, which includes DirecTV. Liberty plans to spin off a portion of the business into a separate, publicly traded company.

Sirius shares were up 7 cents, or 70 percent, at 18 cents in afternoon trading.

Representatives for Ergen did not return messages seeking comment.

As part of the deal announced Tuesday, Liberty will provide a $280 million senior secured loan to Sirius, $250 million of which will be funded on Tuesday. Sirius will use the proceeds of the loan to repay $172 million of its maturing 2.5 percent convertible notes that had been due. The rest will be used for general corporate purposes.

The loan from Liberty bears a 15 percent interest rate and matures in December 2012.

The second phase of Liberty's investment provides another loan of $150 million to Sirius XM. Liberty has also agreed to offer to buy up to $100 million of the loans outstanding under Sirius XM's existing credit facilities.

In exchange, Liberty will get 12.5 million shares of preferred stock convertible into 40 percent of Sirius' common shares, and two seats on the company's board. The company said it expects the seats to go to Malone and Liberty Chief Executive Greg Maffei.

"By strengthening our capital structure and enhancing our financial flexibility, this investment allows us to continue providing the great content and innovative programming our subscribers know and love," Karmazin said in a statement.

But while the deal has bought Sirius time, analysts said it will not solve all its problems or ensure the company remains independent.

Argus Research Co. analyst Joseph Bonner said the terms give Liberty a foothold toward a possible takeover of Sirius, which has two more major debt payments this year and is still struggling to gain subscribers in the recession.

"Undoubtedly Sirius will continue to struggle," he said.

For Liberty, the deal makes clear financial sense, providing a hefty 15 percent return on its loans. The other advantages of Liberty's stake in Sirius are less certain, but one long-term option might be to convert Sirius' satellites to provide video.

"Reconfiguring the satellites up in the orbit and using them to provide satellite television is going to be very difficult, but it can be done," Standard and Poor's analyst Tuna Amobi said.

[Cringer]

"Reconfiguring the satellites up in the orbit and using them to provide satellite television is going to be very difficult, but it can be done," Standard and Poor's analyst Tuna Amobi said.

They already provide backseat TV with at least one of those satellites. I have always wondered how many people actually pay for that service though, I have always figured it was a pretty low number.

[Toddzilla]

I'm pretty sure there is a lawsuit in the courts now against Sirius for using their satellite bandwidth for television, since the terms upon which that part of the radio-spectrum they purchased was for radio use only.

or something like that

[Maple Leafs]

Any XM folks having trouble getting onto XMU (channel 43)?

On my car radio, whenever I try to go to that preset it says "updating" and then flips to something else.

[Dr. Sak]

I got it working

[Butter]

Originally Posted by Maple Leafs

Any XM folks having trouble getting onto XMU (channel 43)?

On my car radio, whenever I try to go to that preset it says "updating" and then flips to something else.

If you are in Canada, there is word on the XMFan boards that XMU is one of the channels that is periodically "pre-empted" due to bandwidth constraints in order for XM Canada to bring their customers MLB games live. So, it shouldn't be out all the time, but at times the channel will "disappear" when the bandwidth is needed for an MLB game's play-by-play. A number of the Canadian subscribers are pissed.

[Ksyrup]

XM has totally sucked since the merger. The latest (or shortest) straw was when they pre-empted Liquid Metal for a month (so they say) for an entire month of Mandatory Metallica. Fuck You Sirius/XM! Your music channels already suck - they're basically Clear Channel programming cut up into genres, as opposed to XM's actual deep cuts/deep playllist philosophy - and now they are taking away my only metal channel and giving me 30 days of the most played metal band on the radio in the history of the earth? Gee, thanks!

If it wasn't for the sports content and talk radio (I really enjoy the POTUS channel), I'd probably cancel my subscription.

[Maple Leafs]

Originally Posted by Butter_of_69

If you are in Canada, there is word on the XMFan boards that XMU is one of the channels that is periodically "pre-empted" due to bandwidth constraints in order for XM Canada to bring their customers MLB games live. So, it shouldn't be out all the time, but at times the channel will "disappear" when the bandwidth is needed for an MLB game's play-by-play. A number of the Canadian subscribers are pissed.

Ah, OK, makes sense I guess. Thanks.

[JonInMiddleGA]

Quick question for some of our SiriusXM users here.

On the regular music channels, anybody ever heard anything like an interview (think p.r. tour sort of thing, random topic) dropped into the content? I don't mean like the old school rap channel talking to LL Cool J, I mean like it or the alt rock channel or something running a 7 minute clip with a gardening expert.

Yes, I know that sounds crazy. No, I don't believe it happens.
I'm just trying to help someone debunk a claim from an overpaid p.r. firm who apparently thinks he's dumber than a sack of hammers.

Otherwise, I'm nuts & they actually do this sort of thing and I've just never once heard it on the Hair Nation feed from Dish Network.

[Butter]

I've never heard anything like that on the music channels, and I listen to them for about 2 hours a day every day, and have for nearly a year.

[Ksyrup]

No, unless you count all the freaking commercials they now have.

[JonInMiddleGA]

Thanks Bo69 & Ksyrup.

I knew I'd never heard anything even remotely close to that but before I made a definitive statement like "they're full of shit" when they claim that this audio press released aired "on every SiriusXM channel", I wanted to see if it sounded as blatantly absurd to a regular listener as it did to me.

[rowech]

Originally Posted by JonInMiddleGA

Quick question for some of our SiriusXM users here.

On the regular music channels, anybody ever heard anything like an interview (think p.r. tour sort of thing, random topic) dropped into the content? I don't mean like the old school rap channel talking to LL Cool J, I mean like it or the alt rock channel or something running a 7 minute clip with a gardening expert.

Yes, I know that sounds crazy. No, I don't believe it happens.
I'm just trying to help someone debunk a claim from an overpaid p.r. firm who apparently thinks he's dumber than a sack of hammers.

Otherwise, I'm nuts & they actually do this sort of thing and I've just never once heard it on the Hair Nation feed from Dish Network.

Channel 40 (I think it's called Deep Tracks) often has interviews with people.

[Ksyrup]

There is that annoying fucktard who talks about the amazing money you can make selling items on eBay from your home. I hate that guy. He tries to sound like he just ran into you at the mall and wants to tell you about this great idea. Fuck him and the people who insult my intelligence enough to make a commercial like that.

[rjolley]

I've heard interviews with people, but not a random interview about something not pertaining to the channel I'm listening to and on every channel I listen to. I think that's what you're saying he's saying is happening.

[JonInMiddleGA]

Originally Posted by rjolley

I've heard interviews with people, but not a random interview about something not pertaining to the channel I'm listening to and on every channel I listen to. I think that's what you're saying he's saying is happening.

Yeah, that's it exactly. The p.r. firm claimed to have gotten a 7 minute taped bit (concerning tips for your home lawn) aired on "all Sirius XM" channels. I don't find it beyond the pale to think that some channel might have used it if they were desperate for filler but I found it beyond absurd to claim that every channel ran it, and at no charge no less.