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Karmazin Raps NAB Spin On Merger

7/02/2007 02:00:00 AM Eastern


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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