XM-Sirius merger and more gov't ignorance of monopolies

[bigred]

http://money.cnn.com/2008/03/24/news/companies/xm_sirius/index.htm?postversion=2008032415

Dumbass gov't cannot see how this is a monopoly, hello (I think as this is not a generation who is exactly big on such "media").

[dudalb]

It was a case of merger or one of the companies going bankrupt. Quite a few media experts have been saying that the Satellite Radio Market is not really big enough for support two networks.

[The Central Scrutinizer]

http://money.cnn.com/2008/03/24/news/companies/xm_sirius/index.htm?postversion=2008032415

Dumbass gov't cannot see how this is a monopoly, hello (I think as this is not a generation who is exactly big on such "media").

There are thousands of radio stations in the US. I suspect the combined market share isn't that big.

[HarryKeogh]

I bought a $1,000 worth of Sirius last month expecting this to happen. Yay merger. Now I could sell a few dozen shares and fill up my gas tank.

[Denver]

I suspect they do see that it creates a monopoly situation.
But, monopolies aren't illegal.

[balrog666]

I suspect they do see that it creates a monopoly situation.
But, monopolies aren't illegal.


Exactly!

Any any investment group with the balls is still free to pay for orbitting a few satellites and launching a competing network ... aren't they?

[dudalb]

Exactly!

Any any investment group with the balls is still free to pay for orbitting a few satellites and launching a competing network ... aren't they?

Exactly. As stated, if this merger had not happened one of the two companies would have gone belly up and you would have had a monopoly anyway.
I always thought that the Stern deal was bad business.;that they paid Howard a lot more then he could ever bring in in profits.

[roger]

There are thousands of radio stations in the US. I suspect the combined market share isn't that big.4%

[HarryKeogh]

Exactly. As stated, if this merger had not happened one of the two companies would have gone belly up and you would have had a monopoly anyway.
I always thought that the Stern deal was bad business.;that they paid Howard a lot more then he could ever bring in in profits.

But if Stern went to XM would Sirius still be around? They were far behind XM in subscribers before the deal. I think it's possible if Stern went to their rival that Sirius would have had to close shop.

I think in the long run it will be a good business decision (unless Stern retires in 3 years and millions of his fans ditch the service)

[bigred]

OK I guess I don't understand the Sherman Antitrust Act then. I thought gist was to prevent monopolies. And if not, then why did the gov't go after Microsoft back when?

[The Central Scrutinizer]

OK I guess I don't understand the Sherman Antitrust Act then. I thought gist was to prevent monopolies. And if not, then why did the gov't go after Microsoft back when?

Unfair trade practices, IIRC.

[dudalb]

OK I guess I don't understand the Sherman Antitrust Act then. I thought gist was to prevent monopolies. And if not, then why did the gov't go after Microsoft back when?

No,you don't.
As we have pointed out, there is nothing that keeps somebody else from sending up satellites and setting up a competitive network.
The Real problem is Satellite radio is not that popular, and there is not enough of a market to support two competing companies when there is such a huge overhead(no pun intended) expense involved.
The Microsoft issue was completely different. Microsoft was accused of using unfair methods to try to destroy competition..that is not the case here.

[Drudgewire]

But if Stern went to XM would Sirius still be around? They were far behind XM in subscribers before the deal. I think it's possible if Stern went to their rival that Sirius would have had to close shop.
Doubtful. Sirius has the NFL, and while they'll wind up together anyway Stern probably wouldn't have joined the same company Opie and Anthony were already a part of.

[dudalb]

My point was that the revenue that Stern brought into Sirius was not enough to justify the huge amounts of money they spent to get him. Only a portion of his regular radio audience followed Stern to Satellite.
Yes, Sirius did get a lot of publicity because of the Stern signing, but that they are merging with XM indicates that the benefits they got from Stern were not enough to turn the company around.

[HarryKeogh]

Doubtful. Sirius has the NFL, and while they'll wind up together anyway Stern probably wouldn't have joined the same company Opie and Anthony were already a part of.

Do you know anyone who bought satellite radio for the NFL (or Oprah, Martha or MLB)? Stern seems to be the only personality who gave such a jolt to the industry.

And do you really think if XM offered him a similiar deal that Sirius did that he wouldn't join them because they have O&A? C'mon. Those rivalries are on-air nonsense. We're talking about hundreds of millions of dollars. Howard would have gone to whoever offered the sweeter deal. It happened to be Sirius.

[Denver]

OK I guess I don't understand the Sherman Antitrust Act then. I thought gist was to prevent monopolies. And if not, then why did the gov't go after Microsoft back when?

The point with the antitrust legislation is to insure that the market stays healthy, and things like supply and demand work well. If I wanted, I could start a company that sold wearable fast food. I would very likely have a monopoly with this. That is legal. Or even if I had one or two competitors, and we had an oligopoly, that would also be legal.

But, if we or I used this centralized market power to manipulate the market, to prevent other competitors from entering, and from allowing the market to work its magic, then the legislation would come in.

[Huh-What?]

4%

Bigger then I thought!

[ponderingturtle]

No,you don't.
As we have pointed out, there is nothing that keeps somebody else from sending up satellites and setting up a competitive network.

It is not that simple, they need to get the bandwith for one.

[mrfreeze]

Well as someone who bought Sirius, and then got a company truck with XM built in and no place to directly plug in the audio from the sirius, this makes me quite happy. $13 a month I don't have to spend now!

[technoextreme]

Unfair trade practices, IIRC.
True. You do realize that there are other companies out there that are monopolies namely the good old NFL. Can someone enlighten me as to why they are actually exempt from the antitrust laws?

[Rob Lister]

It is not that simple, they need to get the bandwith for one.

'tis true. XM and Sirius take up 25% each of the spectrum originally allocated and 50% was taken back. That leaves zero left for competitors. Presumably, they each, after merger, get to keep their allocated space. I know that GM was lobbying for just that because they are a major player.

That leaves zero left for competitors.

eta: as an admitted novice, it seems really dumb the way they (congress/boeing/yada) implemented SDARS. Each available channel should have been auctioned separately with a universal codec requirement.

[joobie]

as per the NFL see here (http://answers.yahoo.com/question/index?qid=20080213072215AAkC9VH).

[The Central Scrutinizer]

True. You do realize that there are other companies out there that are monopolies namely the good old NFL. Can someone enlighten me as to why they are actually exempt from the antitrust laws?

I know that baseball is specifically exempt from anti-trust laws as a result of a SCOTUS decision back in the 20's or 30's, IIRC.

[joobie]

1922: federal baseball club of baltimore, inc vs national baseball clubs

eta linky (http://en.wikipedia.org/wiki/Federal_Baseball_Club_v._National_League)