Now that the Department of Justice has approved the merger between Sirius and XM, and all eyes are on the FCC, it is no surprise that Georgetown Partners has had their 26th meeting with the FCC. This publication has been highly critical of the Georgetown Partner proposal for many reasons. The proposal lacks anything concrete, and seems to offer little in return for what is potentially given up by the merged company. Shareholders of SDARS have endured the costs of getting SDARS where it is today, and now, on the cusp of turning the corner to becoming profitable enterprises with a future, a proposal is made that would take away all of the efforts that have been invested into these companies.
I question whether Chester Davenport and Georgetown Partners is in this for the long haul, or simply acting as a middleman and will divest the business which he is lobbying the FCC to obtain. Is there someone, or some company behind Georgetown Partners? Rather than speculate, and because to date no real answers have been given, I decided to give Mr. Davenport a call, and ask the questions that all investors want an answer to. Unfortunately, Mr. Davenport was not available when I called, and as of this posting has not returned my call. For the record, here is what I intended on asking...
- How do you feel about the DOJ approval that is free and clear of any stipulations?
- Do you agree with the DOJ that the audio entertainment landscape is robust?
- How much money in general terms is Georgetown Partners willing to lease 20% of the spectrum for?
- Will Georgetown Partners help pay marketing costs?
- Will Georgetown Partners help pay customer service costs?
- Will Georgetown Partners help pay capex costs?
- Will Georgetown Partners pay royalty costs?
- Will Georgetown Partners pay chipset subsidies?
- Will Georgetown Partners pay revenue share costs to partners?
- Will Georgetown Partners pay radio rebate costs?
- What types of programming is Georgetown Partners really proposing? How many music channels? What genres? How many talk channels? How many channels will be dedicated to various minorities? How many are advertising based?
- Does Georgetown Partners intend to control this operation, or simply act as a middleman selling off and/or leasing space and/or channels to terrestrial radio entities such as Clear Channel or CBS?
- Is Georgetown Partners being backed by a media or wireless company?
- How much ad revenue does Georgetown Partners plan on generating? Will they target the same advertisers that Sirius and XM are targeting? Will they target the same advertisers that terrestrial radio is targeting? Will your ads be broadcast on a national basis?
- Why is it that terrestrial radio is not voicing an opinion against your proposal? Your proposal in effect would be a bigger threat to terrestrial radio.
- Can Georgetown Partners present a business plan? How long do they anticipate for the business to be profitable? Does Georgetown Partners have pockets deep enough to launch such a business? Is their business really viable? What is your experience in the broadcasting arena?
I feel that if Georgetown Partners is serious enough to have 26 meetings with the FCC that they should be serious enough to begin to shed some light on their proposal. I will continue to try contacting Mr. Davenport to seek out the answers to these reasonable questions.
Position - Long Sirius, Long XM