In a press release, the Justice Department said that "The likely evolution of technology played an important role in the Division's assessment of competitive effects in the longer term because, for example, consumers are likely to have access to new alternatives, including mobile broadband Internet devices, by the time the current long-term contracts between the parties and car manufacturers expire."
And that is exactly why I wouldn't touch either of these companies. The Justice Department is essentially saying that emerging technology will make satellite radio a small enough part of the industry that consumers won't be harmed by the 2 biggest players merging. Do you really want to own a money-losing entity that will be facing increased competition over the next few years because of new alternatives for consumers?
The Justice Department's approval of the merger is a strong indicator that the merger won't be enough of a game changer to effect competition -- which means it also probably isn't a big win for the companies either.
The Department added that "It was not possible to estimate the magnitude of the efficiencies with precision due to the lack of evidentiary support provided by XM and Sirius..."
In other words, the Department found that many of the claims of synergy and efficiency the companies used to pitch the merger to Wall Street were lacking in "evidentiary support." It sounds to me like this could be just another non value-creating merger to add to the pantheon of deals that have over-promised and under-delivered.
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Reader Comments (Page 1 of 1)
3-24-2008 @ 6:24PM
Boris said...
True...But The Newer Technologies have yet to be introduced...Nor have they been INVENTED YET! Duh!
3-24-2008 @ 11:58PM
Victor said...
Your an idiot!
3-24-2008 @ 9:52PM
Victor said...
Sorry not you Boris... Your an idiot was for Zac!
3-24-2008 @ 10:56PM
Bill said...
not to buy is a foolish piece of advice, the merger will open all kinds of new cost savings and better service programing. not to even mention the value of the radio spectrum value to lease or sell. sat radio is finally coming into its own after a long hard fight, it will be profitable and a generally good investment mid to long term. they could even sell programing to some of the competition.
3-25-2008 @ 12:00AM
jason said...
what is this guy smokeing???
Jason
Buyhomesinny.net
3-28-2008 @ 8:32PM
joe said...
a belief in exsiting teck. ,such as it is, like FM AM and ithe analog tevelision signal is a comendable. and saying that the new advances in communication are not a feesable invesment. but oops there goes the TV signal and i wonder what people will ask for in the VERY near furtue. see you all on and in sat. communications!
3-25-2008 @ 8:27AM
Sheldon L said...
...and Motorolla lost billions on satallite phone system...internet radio is already 'hear'.
3-25-2008 @ 11:54AM
Dustin Wires said...
Sirius is one of the most messed up company's I've ever been with. I've been a subscriber for about 5 years know. The music and channels are the best in the business. As far as the customer service go's(They Fail Very Bad). Lets start, after asking to fix several time they still don't know my account. Thats funny I still pay a bill! My radio went out in my truck over the weekend. With a call to sirius 5 times to find out they wanted to put the blame on Kenwood was very poor. After talking to Kenwood it was clear it was a sirius issue. (I value a customer as a guest in my home or business). With yet another call to sirius I was hung up on for no reason (and not called back). With such a poor company the stocks are doing well. With this kind of service I would think otherwise for stock and merger!!!
6-04-2008 @ 7:22AM
JACK said...
I have had my Sirius radio for about 4 yrs now,not a problem one! I cannot believe it is taking all this time to get approval to merge with MX. It looks like a conspiricy, hold off and let em go broke! What a farce, can the FCC be sued?