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Thread: Interoperable Radios and Executive Candor, a look back.

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  1. #1
    crfceo is offline
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    Interoperable Radios and Executive Candor, a look back.

    All this talk of interoperability and lack of candor has really got me upset. As a shareholder, I am concerned. So I decided to look into the company's annual reports dating back to 2003, when I first invested in sirius stock. These reports are for investors. They are filled with all the facts an investor needs to decide to buy, sell or hold. Making the right choice is up to the individual. There have been allegations of wrong-doing by many organizations with regard to this issue. The facts do not support their argument.


    The 2003 annual report states: "On February 16, 2000, we signed an agreement with XM Radio, the holder of the other FCC license to provide a satellite-based digital audio radio service, to develop a unified standard for satellite radios to enable consumers to purchase one radio capable of receiving both SIRIUS and XM Radio's services. We expect the unified standard to detail the technology to be employed by manufacturers of such dual-mode radios. The technology relating to this unified standard will be jointly developed, funded and owned by the two companies. In addition, we are working with XM Radio to promote adoption of the new standard by creating a service mark for satellite radio. This unified standard is also intended to meet FCC rules that require interoperability of both licensed satellite radio systems. We anticipate that it will take several years to develop radios capable of receiving both services.


    Similar wording appears in 2004. "to be employed by manufacturers" this means built, marketed and sold by radio manufacturers. Not Sirius. Not xm. Acknowledgement is made that it will be several years before interoperability is realized.


    In 2005, the annual report states the following: We believe that this agreement, and our efforts with XM Radio to develop this unified standard for satellite radios, satisfies the interoperability condition contained in our FCC license, although the FCC has not addressed this issue. We notified the FCC of this agreement in 2000, and asked the FCC to concur that our efforts to develop this unified standard satisfied the conditions to our license. In January 2005, the FCC asked us and XM Radio to provide a written update regarding the status of developing interoperable receivers and the time frame for making interoperable receivers available to the public. We are in the process of preparing a response to this request.


    Which brings us to the 2006 annual report, in which sirius states : "...We expect the unified standard to detail the technology to be employed by manufacturers of such dual-mode radios, although we have no assurances that any manufacturer will build, or that a market will develop, for such dual-mode radios....In 2005, we substantially completed the design of a radio capable of receiving both services.

    As far as this investor is concerned....VOILA! FCC mandate met! The 2007 and 2008 annual reports go on to state that the company believes the mandate to have been acheived. Here's the monkey wrench in all of it. The lack of candor seems to be pointing at Mel Karmazin.


    Now mel started in november 2004 so for all intents and purposes, he really began in 2005. Sometime in 2005 they completed the interoperable radio as reported in the 2006 annual report. Sirius announced the merger with xm in febuary of 2007. Meetings would have been going on since 2006. So Mel Karmazin had about a 1 year window to get this interoperable radio on the market assuming you believe that it was his responsibility. It was not. Sirius met their responsibility to the FCC and to shareholders.


    For those of us who have been around a while, we understand that the launch of satellite radio was not an easy task. Money was the first problem. The second was not enough chipsets available in the beginning years which created a shortage of radios. Demand outstripped supply. This is an overlooked fact. The companies couldn't get enough radios on the shelves to meet demand, much less finance the production of radios that might never have gotten them a single subscriber. The question we all asked ourselves each Christmas was "are there going to be enough radios?" As I stated....the mandate was met.


    Back to Mel for a moment. When he took over the reigns of sirius he had a resonsibility to shareholders. Joseph Clayton, the former CEO was a spendthrift who would issue more and more shares on a whim...you always knew when a mega Stern type deal was coming! Mels priority, and rightfully so, so to trim the fat....something various members of Congress could learn from. Under Mel, sirius has cut costs and increased revenue. No one complained when he under promised and over delivered by beating street expectations.


    Now a farce has been created to destroy the merger, claiming it was the companies responsibility themselves to deploy interoperable radios. I would much rather as an investor see profitability before interoperability. I think most investors would agree. The companies have acted in good faith to the FCC and the shareholders. It's time the FCC put an end to the nonsense and approve the merger.

    (linked article at www.siriusnewsrumors.blogspot.com)

  2. #2
    hartleib1 is offline
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    Sirius stated in their 2002 and 2003 SEC filings that they “were required to develop and deploy interoperable radios.” (Emphasis added.)

  3. #3
    zcurzan is offline
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    Well written CRF.

    Hartleib. Putting aside all historical documents you might find that contain language such as "deploy" or "bring to market"....Since the FCC has failed to raise any issues regarding this subject, and hasn't began any enforcement actions. What do you think this means? They are simply ignorant to the fact that their mandate is "being ignored"? They don't care? Or internally they have decided that this is a non-issue? Do the commissioners really need a bunch of goons looking for a hand-out to remind them of how to do their job?

  4. #4
    crfceo is offline
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    With all due respect, I checked 2002 -2008....no mention of the word deploy..


    2003 annual report:

    Unified Standard. On February 16, 2000, we signed an agreement with XM Radio, the holder of the other FCC license to provide a satellite-based digital audio radio service, to develop a unified standard for satellite radios to enable consumers to purchase one radio capable of receiving both SIRIUS and XM Radio's services. We expect the unified standard to detail the technology to be employed by manufacturers of such dual-mode radios. The technology relating to this unified standard will be jointly developed, funded and owned by the two companies. In addition, we are working with XM Radio to promote adoption of the new standard by creating a service mark for satellite radio. This unified standard is also intended to meet FCC rules that require interoperability of both licensed satellite radio systems. We anticipate that it will take several years to develop radios capable of receiving both services.

    As part of this joint development agreement, we and XM Radio have licensed our intellectual property to one another.

    Both companies expect to work with their automakers and radio manufacturers to integrate the new unified standard and have agreed that future agreements with automakers and radio manufacturers will specify the unified satellite radio standard. Furthermore, we and XM Radio have agreed that future agreements with retail and automotive distribution partners and content providers will be on a non-exclusive basis.
    2004 adds:


    Our FCC license is conditioned on us certifying that our system includes a receiver design that will permit end users to access XM Radio's system. On February 16, 2000, we signed an agreement with XM Radio to jointly develop a unified standard for satellite radios to facilitate the ability of consumers to purchase one radio capable of receiving both our and XM Radio's services. We believe that this agreement, and our efforts with XM Radio to develop this unified standard for satellite radios, satisfies the interoperability condition contained in our FCC license. We notified the FCC of this agreement on October 6, 2000. In that notice, we anticipated that integrated circuits capable of receiving both services would be available in mid-2004 and that manufacturers could begin producing interoperable radios thereafter; however, we do not anticipate that these integrated circuits will be available on this timetable. We also asked the FCC to concur that our efforts to develop this unified standard satisfied the conditions to our license. The FCC has not responded to this request.

  5. #5
    hartleib1 is offline
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    Dear

    I see the Consumer Union has asked for the redacted documents cited by C3SR be disseminated to the public as they are of great importance for all parties which have an interest in the Sirius/XM Satellite Radio merger.

    There is nothing in the documents that warrants protection from the double protective orders, there are no intellectual concerns or protection of proprietary information. The only thing being protected is the lack of candor
    and collusion of the two SDARS companies.

    I spoke with Mr. Michael DeLuca from Interoperable Technologies LLC as he is the author of the documents in question. He is not particularly happy with the present situation as it is clear the companies have pointed
    the finger at him and suggest that the contents of these documents was nothing more than an overzealous engineer who had high hopes and aspirations for interoperable devices. I have had communications with
    Mr. DeLuca over the last 18 months and believe he is a man of integrity, the company (Interoperable Technologies LLC) is the joint venture formed by Sirius and XM of which Sirius and XM maintain a 50/50 ownership.
    I might add that Mr. Deluca, as well as being an engineer is also an attorney. I informed Mr. DeLuca that I will be naming his company as a defendant in my forthcoming racketeering suit so that Sirius and XM cannot
    prohibit his testimony. I suggested to Mr DeLuca his voice deserves to be heard (as it appears he has been thrown under the bus and is the sacrificial lamb). It is time for these two companies to come clean with their
    efforts to prevent and preclude consumers from having access to or knowledge of interoperable devices.

    , you asked what you can do to help as I have great respect for you. You are very forthright and a straight shooter. I ask that public knowledge address the failure of the FCC as a regulatory agency to serve the
    public's interest, expose the FCC for what it has become - a shill for deep pocketed corporations to wield their political influence and push their own self interests and agendas. I, for one, am very troubled after my
    two year long quest to expose the truth, that the consolidation that has occurred in both the print and broadcast media has made it nearly impossible for one's voice to be heard. If there is any way I can convince you
    to possibly issue a joint press release requesting the FCC to publicly disclose all of the information surrounding interoperability prior to any decision for or against the pending merger, it would be greatly appreciated.
    I ask this first as a satellite radio consumer as well as a large shareholder in the SDARS sector in which the delay has cost me hundreds of thousands of dollars, thousands of hours of my time. I do this as a concerned
    individual with no affiliation and/or backing of any
    organization, because it is the right thing to do. This is something that is going to change the way mobile digital content is distributed. This decision will have great impact on consumers for generations to come. This is much
    more than satellite radio - this is about mobile digital content distribution which will include audio, video, data, telematics, internet connectivity to cars and mobile devices. If this is not addressed prior to the Commission's
    decision on the pending merger, I would argue consumers would be damaged even further as the merger will be challenged in the courts and the FCC would be complicit in the conspiracy to prevent the truth from being
    known as to these companies' compliance with their licensing requirements. The failure of the FCC and it's duties to protect the public will be exposed, and in my
    opinion could lead to a complete overhaul of the FCC as it has become an inept and toothless regulatory agency.

    Also very troubling to me is that the multiple conference calls I have had with Stephen Rangel of the Energy and Commerce Committee, Investigative and Oversight Committee, has seemingly been for not as I was
    supposed to testify at the upcoming Congressional hearings which have now either been delayed or terminated. I have heard that the Chairman had to go to Congressman Dingle with his hat in hand and I hear that
    General Motors was able to wield their influence with Congressmen Markey and Dingle. Consumers of satellite radio and the public in general deserve to have all of the facts prior to any decision being rendered. I ask
    with all sincerity, that you help bring this issue the press and congressional attention it deserves.

    . I thank you in advance for your consideration and any help or advice you can provide.

    Sincerely,

    Michael Hartleib

  6. #6
    crfceo is offline
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    There we have it....a lawsuit is your reply? I posted the facts....you post....I still don't know. You're delusional....you should seek help. This all boils down to the mandate. Sirius complied. Sirius informed shareholders.

    You stated that the 10 k stated deployed. I proved to you that it did not. Want to sue? A company you claim to be so heavily invested in? I had heard good things about you...apparently they were wrong. You have an agenda that does not serve yourself nor me as shareholders. Do me a favor....sell...take the loss. You screwed up and you are looking for anyone else to blame...I'm done with you.

  7. #7
    hartleib1 is offline
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    You stated that the 10 k stated deployed. I proved to you that it did not. Want to sue? A company you claim to be so heavily invested in? I had heard good things about you...apparently they were wrong. You have an agenda that does not serve yourself nor me as shareholders. Do me a favor....sell...take the loss. You screwed up and you are looking for anyone else to blame...I'm done with you.



    I assure you that has not been my agenda. Tell aka Tyler to give you my number I will explain thigs in more detail.

  8. #8
    deewcom is offline
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    Quote Originally Posted by crfceo View Post
    There we have it....a lawsuit is your reply? I posted the facts....you post....I still don't know. You're delusional....you should seek help. This all boils down to the mandate. Sirius complied. Sirius informed shareholders.

    You stated that the 10 k stated deployed. I proved to you that it did not. Want to sue? A company you claim to be so heavily invested in? I had heard good things about you...apparently they were wrong. You have an agenda that does not serve yourself nor me as shareholders. Do me a favor....sell...take the loss. You screwed up and you are looking for anyone else to blame...I'm done with you.
    CRFCEO, Please provide a summary of any phone follow up with Hartleib. You have been doing good work here and on your own blog. I'd like to know if he can win you over. Your instincts seem correct to me. Hartleib is an outside guy (with some clout, apparently) who is doing his best to muck up the merger process. Can he win millions in a lawsuit - more than enough to write off his SIRI losses? Seems a long shot. There is no way that his lawsuit could help the rest of us schmucks. We need the merger. We don't need guys like him doing what he is doing. We've got the NAB for that.

  9. #9
    tim wallick is offline
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    Quote Originally Posted by hartleib1 View Post
    You stated that the 10 k stated deployed. I proved to you that it did not. Want to sue? A company you claim to be so heavily invested in? I had heard good things about you...apparently they were wrong. You have an agenda that does not serve yourself nor me as shareholders. Do me a favor....sell...take the loss. You screwed up and you are looking for anyone else to blame...I'm done with you.

    I assure you that has not been my agenda. Tell aka Tyler to give you my number I will explain thigs in more detail.
    THATS A BIT HARSH COMING FROM YOU CRFCEO

    I read what you had posted on the yahoo site about having some fun and trying to discredit his comments.

    again you mis-construe and twist what Micheal says are facts if you read the 10ks you will find attached to each a copy via a reference link the (joint venture agreement) document that both Sirius and xmsr filed with the sec and the fcc in un-redacted form, which states clearly they then understood and planned to deploy to the consumer a single device that would receive both services at no further cost to the consumer for hardware.based on the fcc mandate.

    so i understand your comments maybe in error as you may have missed the link or could not find a version to read.

    this is the very reason some long term owners bought into this company and sector as a whole.he has a valid point and its ok not to agree as you feel hes hurting these equities...you would have been better of today if these companies did as they agreed by deploying the device to the public..

    the fault lays with Sirius xm and fcc and none of the three want the public or consumer to understand the full details related to this issue.

    sat rad investors were led then screwed big time on this very issue.

    all hes was asking for was the whole truth to be a better informed shareholder based on past statements, as he thought why pay such a high price for xm if the content is what really drives subscribers as claimed by both sirius and xmsr.

    just roll out the dual device and let the better content take care of the rest.

    and it looked like that was going to happen in 2006 then poof no device instead a merger.

    which was a good ideal but after ten years alas no device is available to consumers ... and screw you all their wont even be one if we don't merge Mel made sure he said that in case the deal got shot down. just to force the issue

    he does not have to feed this information to anybody hell i see broadcasters i know posting on this board and some of those company's would love to get a slice of the sector. and thats just fine its part of the bigger picture.

    us electronics even used some of his filed information and convinced the fcc to act in the public interest on the open device issue.

    this did not screw the investor public or company ,everybody won maybe even the consumer can get a third party device that can now record content and wont cost the company's the extra fees for recording royalties.

    which tends to lend more credit to his efforts of the past.you can call him loony if you chose or evil and greedy...

    when i first contacted the fcc on the dual device issue and asked for a current status they sent me back a joint letter from Sirius/xm which was a reply to a fcc inquiry letter in 2005 the document said the interoperable device mandate was met based on the sirius/xm thinking..

    I then asked for their confirmation (fcc) on the issue and explained what i thought the mandate meant in the stated vision and to me. this was in December 2006. they responded with the instructions for filing for a declaratory ruling on this issue.

    yesterday i dug around till i found a copy of the dei distributor doc. and the claims made by use they were supported! all efforts were directed by sirius period. and the contract ruled out xm radio devices by name period and any other companies that wanted to do satellite radio services..

    the old broadcasters are in trouble in todays digital world I dont blame them for fighting for every inch they can get.

  10. #10
    Dlite is offline
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    I wish my comment was still on CRF's blog.

    The merger is about to be consummated and this is best for both the company and the consumer. Move on, seriously.

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