But forgive Senator Kohl for his opinion that “Satellite radio is a unique service for which none of the other audio services is a substitute.”  He is 77, after all, and clearly has no experience with the hundreds of free audio entertainment alternatives.  If he did, he would have no fear of higher prices and poorer service.  And he cannot claim to have researched the field very thoroughly after his comment that “Uncertain promises of competition from new technologies tomorrow do not protect consumers from higher prices today.” 

Senator: The “new technologies” of tomorrow that you dismiss are, in large part, already here.

XM and Sirius, though nice services, are still relatively inconvenient.  For your subscription dollars, you remain at the mercy of a DJ’s music and news selections, which, depending on the day, can be good or bad.  The basic packages lack on-demand features and in many ways satellite radio is just like regular radio. 

The promise of “commercial free” is even misleading.  Anyone with experience on either service knows there are plenty of commercials. 

Satellite radio is useful and pleasing as long as you’re not the one paying for it.  Unless Howard Stern is worth the price of subscription – which many believe he is – there’s little justification for satellite over other options.

Perhaps the one venue that satellite has a justifiable place in the world, for the moment, is the car.  Free radio in many parts of the country is intolerable, and for long commutes high quality radio could be worth the price.

But Senator Kohl gives entirely too much credit to satellite’s current place in the market.  It’s not so strong that a merged entity would have any room whatsoever to both raise prices and drop quality.  Customers would flee in droves. 

No, the only way to retain consumer interest in satellite radio would be to hold prices steady while raising the quality.  Anything short of that would kill the merged company.

The merger should pass because there is no reason to think a single satellite entity would have any more sway over the market than it currently has.  Believe it: Sirius and XM need to merge, if only for survival.  It is their struggle to survive that should signal to Senator Kohl the real position of satellite radio in the audio entertainment market.  The internet has enabled free listening options that, in many cases, exceed the offerings of XM and Sirius.  With technology to make internet access in our cars already a reality and widespread use of that technology less than three years away, satellite will have yet another life-threatening problem.  Let the merger pass for the sheer survival of the platform, and to give consumers who wish to pay for it that option.  Blocking it would, in essence, mark the end.  Is that better for consumers?

 
Scott Goldberg

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