Monday, February 19, 2007

XM and Sirius Satellite Radio are Close to Merger: New York Post

It's long been a rumor, but now it seems the merger of the XM and Sirius satellite radio networks is becoming a reality. The New York Post is reporting Monday that the two heavyweights of satellite radio may announce a merger as early as today.

The two parties were said to be negotiating all weekend and had come close to an agreement. The Post also noted that the deal could collapse at the last moment.

Since the two rivals burst onto the scene a few years ago, they've been whacking each other over the head to win subscribers. To win big-name, high-profile air personalities and properties, they've gotten into bidding wars for top talent. Sirius laid out big bucks to land Howard Stern, and also has deals with the estate of Frank Sinatra and with NASCAR. It will launch an all-Sinatra channel soon.

XM boasts queen of all media Oprah Winfrey, has Bob Dylan playing DJ on his own show, and also broadcasts Major League Baseball.

So will the deal go through, or will it go bust? It seems insane for the two to keep competing against each other; does the world really need two rival satellite networks? And the time seems right, before the networks sink millions of dollars more into talent acquisition and technology buildouts.

But if the deal fails now, it remains to be seen if the two will continue their separate ways indefinitely, or whether a merger will indeed happen sometime down the road. I think the latter will happen: a merger will take place eventually, when one network finds that it must merge or go bankrupt.

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