C3SR And Georgetown Partners Still Knocking On FCC’s Door
In filings made public today, both C3SR and Georgetown Partners are still approaching the FCC with added information and reiterating their stances.
C3SR
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.
GEORGETOWN PARTNERS
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!
Tyler, give it up.
Your blog is getting old!
Franklin, Your a loser, find another site if your too limited to realize/understand that the merger will be reality within 2 weeks. Nice name!
Franklin can have his opinions. These and similar comments all hail from an I.P. address at a common locality.
Franklin, if you feel the blog is old that is fine.
Persoanlly, I would want to know what Georgetown Partners is willing to put on the table. After 22 meetings, and given their substantial request, I think it is a reasonable request.
As for C3SR, a group that claims to advocate on behalf of satellite radio subscribers, what is their agenda? Who pays the bills? Why haven’t they polled the group that they want to advocate for? Ho can they advocate without knowing the stance of the group?
These are reasonable questions, and I would rather know than not.
Franklin says Tyler’s blog is getting old, I guess he feels that way because Tyler is reporting on the all the meetings Georgetown Partners and C3SR has had with the FCC in which they say the samething (or dont say) over and over again. Why not instead write the FCC and tell them that what Georgetown Partners and C3SR is saying is getting old.
Exactly where are these cost savings going to be when there is a merger? I know the music royalties are a fixed percentage, so that doesn’t change. The big sports and talk names are locked up for long terms, so that doesn’t change. Revenue will surely drop with a la carte pricing, like it has for cable TV, ooops I guess everyone believed that lie before. Its not like you can return the sats for a refund, those costs remain. The only gains to be made by the merger are by the executives. I applaud the forces trying to prevent the merger, especially after several LARGE pay increases for Sirius execs in the past few months.
If they couldn’t run a business correctly, they should never have bid on the licenses from the govt. I’d have more sympathy if XM & Sirius showed more to the consumer and actually followed through with their original promise to produce a radio capable of receiving both signals.
Say NO to the merger.
Hi all — I am a businessman running a business. Now this rep comes along 22 times and talks to all of my 5 directors.
What about? Should I let him touch my doorbell without knowing what he wants or offers?
Am I going to pay someone or am I getting money?
I know the FCC is not a business and that’s why they respond as such.
But even a Congress Committee as they are should forbid these people to waste their time?
If it is so important to them to allow for 22 visits, why don’t these Georgetown Partners come up with and expose their overwhelming plans?
I cannot even find their website… I googled and gave up. They are in Bethesda, MD, their letterhead says.
Does anyone have their websiteaddress for me?
Tyler, do you?
I would like to see how they walk and talk, wouldn’t you?
Oxford….
you will have better luck with google by using “Chester Davenport”. There are some interesting articles on the man.
Unfortunately, finding out what they are proposing is a mystery. From what I can tell they are trying to get the government to mandate their proposal……THEN they will negotiate with Sirius and XM with that ace.
Chad….
Might I suggest that you read some of the analyst reports on the merger and how the synergies are developed and calculated.
Marketing costs will be consolidated, overhead costs will be consolidated. satellites can not be returned, but there is indeed a slow-down in launching. Going forward, half of the satellites will have to be constructed.
A-La-Carte pricing is caounting on increasing revenue. Everyone who has looked at this can see that, and it has been discussed. If a lower price point brings in the appropriate volume of subscribers who otherwise would not be subscribers, the revenue will increase.
I would love to see an interoperable radio. The merger makes this much more of a reality than not.
Nice job Tyler, I would like to just add not one person is saying the savings will come overnite. The estimates go from 4 to 7 billion and the time frames to reallize all of it is also about 4 to 8 years. most dont even think any savings for at least a year. Chad should stop reading FrontMeds manifesto and start reading some analyst reports.