In filings made public today, both C3SR and Georgetown Partners are still approaching the FCC with added information and reiterating their stances.
C3SR wrote a letter today that was similar to the letter they wrote after Sirius announced their subscriber numbers for 2007. In this letter, C3SR points out that XM Satellite Radio. The self serving letter is yet another embarrassment to C3SR and their attorneys as the points made are very one sided and the agenda is clear. In the letter they note:
“XM finished the year with 9,000,000 subscribers, and 18% increase over the 2006 subscriber base”
“XM, while reducing its yearly net loss, grew its total revenues for 2007 to an astonishing $1.1 billion”
C3SR then comes to the conclusion, based solely on these three metrics (subs, net loss, and revenue), that the entire argument for a merger should be erased.
Has C3SR or their attorneys even looked at these businesses? Do they comprehend the substantial costs that these companies need to operate. Do they understand that even with $1.1 billion in revenue that the company still had a loss for the year? Do they understand that already this year XM has borrowed over $180 million against credit facilities? Do they understand that even while these companies are not using a failing business argument for the merger that the DOJ will look at the businesses to measure chances of success?
C3SR states that competition with Sirius has not weakened XM. By what measure do they arrive at this conclusion? The growth of subscribers has slowed substantially, and is now reliant on the OEM channel, where 50% of those that get satellite radio in their car opt not to keep it. For both Sirius and XM the ramp up in OEM installs, which are subsidized by the SDARS companies, is the mechanism that is facilitating the growth. In simple terms, Sirius and XM are buying their growth at this point.
C3SR goes so far as to say that there is NO substitute for satellite radio. Again, what kind of fools do C3SR and their attorney’s take consumers and the FCC for? When 50% of those that get exposed choose not to subscribe to satellite, what does C3SR and Williams Mullen (the attorney) think that these people are listening to? Road noise?
What we have here is a group funded by the National Association of Broadcasters that is demonstrating that they do not understand the business, they do not understand the consumer, and they do not understand the audio entertainment landscape. Enough said.
In a filing today, Georgetown Partners stated that they have had yet another meeting with the FCC. This is the TWENTY-SECOND meeting that Georgetown Partners has had. They have yet to put anything concrete on the table. This latest meeting was with the legal council of Commissioner Adelstein.
Why is Davenport so secretive about his plans? Why is he afraid to put a proposal on the table? If he is so serious about this why wont he share his agenda? In my experience, when someone plays this coy for so long they are doing it because they are pulling the wool over someones eyes.
Davenport wants to ride coat tails. He is trying to get something for a cost well below the value. He wants to take away 20% of the of the company. If his quest was noble, he would state his terms in a more concrete manner. He would let the companies, and the shareholders of the companies see what he is putting on the table. He has done none of this, instead trying to acquire a stake through mandate.
Davenport……Find some courage and step up to the plate. Stop dancing and pontificating and get some details out there. Your insistence on hiding and playing peek-a-boo is a waste of everyone’s time and energy at this point. Lay your cards on the table. Twenty-two meeting with the FCC and not a stitch of detail!