Jim Cramer, sporting the "merger overdue calendar" as a necklace is applying even more pressure with regards to the Sirius and XM merger. Today, the target was not politicians, but the terrestrial radio players that are trying to block the merger between Sirius and XM.
Referring to terrestrial radio stocks Cramer had this to say, "These stocks are so intrinsically broken that they are not fit to own even when the broader market rebounds. Terrestrial radio’s biggest problem is retaining advertising revenues as more ad dollars are siphoned by the Internet. In 2007 total ad dollars for radio fell to where they were in 2003. That points to an industry going backwards, not forward."
Cramer is not only saying that terrestrial radio is broken, he takes things a step further. He informs all who are listening that terrestrial radio is trying to take the merger away from consumers and investors. Cramer points out that terrestrial radio has been slow to adjust their business model. This is a point that I have made on numerous occasions. Cramer echos my sentiment that terrestrial radio would rather keep their business model in the status quo rather than adapt to new strategies that will keep them viable.
At this point terrestrial is playing a separation game when speaking about the merger. They speak only of their terrestrial business when dealing with the merger, but are quick to point out their Internet business is growing rapidly when speaking to investors. They are against the merger as "terrestrial radio" but take no position on it as "HD Radio" in hopes that a merger concession will give HD instant access to the dashboards of the auto industry.
Cramer is not going to fade away in this issue. He is going after it like he is on a mission, and dedicating a lot of air time to it. The pressure on regulators is now happening from every conceivable side.
CRAMER VIDEO - Check it out
Position - Long Sirius, Long XM, No Position Terrestrial Radio Equities