Karmazin Raps NAB Spin On Merger
In sitdown with TWICE, Sirius CEO calls broadcast lobby 'disingenuous.'
by Joseph Palenchar and Amy Gilroy -- TWICE, 7/2/2007
NEW YORK — The National Association of Broadcasters [NAB] is "disingenuous" for opposing the proposed satellite radio merger on the grounds that a duopoly would become a monopoly, Sirius Satellite Radio CEO Mel Karmazin told TWICE in an exclusive interview.
The annual reports of all publicly held radio groups "say in their risk factors that they compete with satellite radio," he said. "So it's just disingenuous for an organization [NAB] to stand up and say this is a duopoly becoming a monopoly."
During an interview at Sirius headquarters here, Karmazin said the intensity of the NAB campaign to shoot down the proposed XM-Sirius merger, although "probably predictable," proves the point that satellite and terrestrial radio compete and that the proposed merger would not result in a monopoly.
Karmazin also made the following points:
The merger will help satellite radio compete, but isn't necessary for the industry's survival.
In order to meet the FCC's public-interest requirements, the merged companies would offer "more choice, lower prices" and flexible — but not totally a la carte — pricing plans, which would credit consumers for channels that they choose not to receive.
Aftermarket customers are less likely to churn than consumers who get satellite radio in a new car.
See p. 22 and 23 for Karmazin's responses to key questions. The interview is available in its entirety at www.TWICE.com.
Satellite Radio Metrics| Q1 2007 | Q1 2006 | 2006 | |||
| Subscriber base | |||||
| Sirius | 6,581,045 | +61.4% | 4,077,747 | 6,024,555 | +81.7% |
| XM | 7,913,728 | +21.7% | 6,501,859 | 7,628,552 | +28.6% |
| Combined | 14,449,773 | +36.6% | 10,579,606 | 13,653,107 | +47.6% |
| Net New Subscriber Additions | |||||
| Sirius | 556,490 | -26.9% | 761,187 | 2,707,995 | +24.6% |
| XM | 285,176 | -49.9% | 568,902 | 1,695,595 | -37.3% |
| Combined | 841,666 | -36.7% | 1,330,089 | 4,403,590 | -9.7% |
| Gross Subscriber Additions, Deactivations | |||||
| Sirius | |||||
| Gross adds | 988,458 | +2.9% | 960,610 | 3,758,163 | +49.2% |
| Deactivations | 431,968 | +116.7% | 199,423 | 1,050,168 | +203.5% |
| XM | |||||
| Gross Adds | 868,067 | -13.8% | 1,007,306 | 3,866,481 | -6.4% |
| Deactivations | 582,891 | +33% | 438,404 | 2,170,886 | +52.2% |
| Combined | |||||
| Gross Adds | 1,856,525 | -5.7% | 1,967,916 | 7,624,644 | +14.7% |
| Deactivations | 1,014,859 | +59.1% | 637,827 | 3,221,054 | +81.7% |
| Sources: Sirius, XM company reports © TWICE 2007 | |||||
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