Sirius CEO Mel Karmazin joined the cast of “The Howard Stern Show” this morning to share with the shock-jock’s audience his reasons for the merger with XM and how it will be “good for subscribers.”
First of all, he eschewed the suggestion that the combined company would be a monopoly, thus allowing it to raise prices. “We still compete with terrestrial radio,” he said, reiterating the fact that his biggest competition offers its service for free. In addition, he mentioned Apple’s iPod as a competitor to satellite radio.
He even said that, if it would assure the passage of the merger through the appropriate regulatory commissions, he would make promises concerning subscription prices.
One question that’s been on the minds of subscribers and dealers has been whether they’ll have access to both services, or will they need to purchase additional equipment. Karmazin, who would be the CEO of the combined company, said that the immediate intention is to offer both services to both subscriber bases, by piggybacking the channels from one service onto another. However, it’s true that the direct connections between satellites and receivers are not compatible and new equipment will be required to do that.
In fact, one sticking point in the merger, Karmazin said, was the fact that XM has forged more deals with automotive manufacturers than Sirius, leading the former to demand a bigger share of the combined company’s value. The two companies ended up going 50-50.
Another problem Karmazin feels the merger solves is the fact that sports fans have to choose which service they want, depending on the sport they enjoy most, since XM and Sirius combined carry the NHL, NBA, NFL and Major League Baseball, but not individually.
Other issues Karmazin and the self-described “King of All Media” discussed were Stern’s wedding plans and Stern sidekick Artie Lange’s concerns about how the merger will affect the selection available in the company’s vending machines.
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