U.S. Electronics To Meet With FCC Next Week
While people still seem to feel that a merger decision from the Department of Justice may come any day now, the FCC still may have a ways to go, and in a filing with the FCC on March 5th, U.S. Electronics already has a meeting scheduled for next week.
In this latest filing, U.S. Electronics seems to have toned down an anti-merger stance and instead will be meeting with the FCC on the open device concession. Such a concession, which is also something that Public Knowledge, Media Access Project, the HD Radio Alliance, and others have proposed, would make it possible for many electronics firms to produce hardware that is capable of receiving satellite radio signals.
U.S. Electronics will be giving a presentation to the FCC next week.
At this point, it can be safely assumed that an open device concession is something that is being considered by the FCC. Sirius and XM have not really outlined a stance on the issue. This latest U.S. Electronics filing seems to have stepped away from previous posturing that the company was conducting, and instead seems focused on a particular concession.
In my opinion, an open device platform is something that should be explored, and such a concession would not be a deal breaker.
Position – Long Sirius, Long XM
What does an Open Device Platform mean. What are the issues.
Jon
It would allow any manufacturer the ability to produce SDARS receivers and market them. Sirius and XM would no longer control who their manufacturing partners are, as any company could make equipment.
Excuse my ignorance, but why is that a problem for XM and Sirius, assuming it even is. And thanks for the repsonse.
Jon
In many ways it is not a problem, but sometimes it could be problematic.
For example
Acme electronics (a fictiicious company) wants to make a SDARS receiver. They use inferior parts, and manufacturing facilities. Their products last two months and then die. Consumers will complain to Sirius and XM, but the problem really isn’t sirius or XM’s. Sirius and XM tell the consumer that thgey have to go to Acme electronics. The problem is that there is no way to contact Acme. The consumer gets frustrated and cancels their service.
The way things are now, Sirius and XM contract their partners. They maintain control over who will be able to manufacture and sell their products.
An open platform needs some controls, but is possible. It simply needs to be done the right way, and to certain standards
Thanks. Doesn’t sound like a big issue to me.
Then if such a concession is approved, let the FCC be responsible for any fallout.
I also think if sirius/xm produce their own–they make $$ on the receivers too so a revenue source would be lost
Gary, they are losing money on each one. That also for me makes it not such a bad deal. SIRI/XMSR is interested in selling the subscribtion thats were the money is.
john is exactly right.
Open platform is good and bad. It is bad in the instance that Tyler suggests, but it is also good in that XM/Sirius will no longer have to subsidize the construction of their radios, a factor which causes them to loose money on each reciever sold. They make their money back on the subscription, as long as the subscriber stays on for at least a certain amount of time. With an Open Platform, electronics manufacturers will be able to produce radios at their desire, but XM/Sirius will not subsidize these products. Open platforms also allow for much better product innovation, assuming that the recievers sell well enough to encourage producers to make them. At this point, that is not happening, which leads to producing inferior radios at a very cheap price, going back to Tyler’s argument.
I do not see this concession as a problem, as long as it is done correctly as Tyler states. In fact, I feel that this will HELP the two companies, not hurt them.