XM And Sirius To Offer 'A La Carte' Option, Lower Prices
July 23, 2007 at 8:59 AM (PT)
SIRIUS SATELLITE RADIO and XM SATELLITE RADIO have announced that the merged company will offer American consumers the opportunity to choose programming on an a la carte basis. TOMORROW, XM and SIRIUS will file their joint reply comments with the FCC; the filing will include detailed programming and pricing plans, including two a la carte options -- the first time such an offer has been made.
One option will allow subscribers to choose 50 channels for just $6.99 -- a 46% decrease from the current standard subscription rate of $12.95. Under this option, customers will also be able to include additional channels for as little as 25 cents each. The second a la carte option will allow subscribers to choose 100 channels and will allow SIRIUS customers to select from XM's programming (and vice versa).
"The a la carte options and other packages unveiled today demonstrate that consumers will be the beneficiaries of this merger," said SIRIUS/CEO MEL KARMAZIN. "The efficiencies of the merger will allow the combined companies to save hundreds of millions of dollars a year and give us the opportunity to increase the number of programming options available to subscribers,"
"MEL and I are very excited about being able to offer a la carte programming," said XM Chairman GARY PARSONS. "We think this is going to be great for consumers and great for our business. From the day this transaction was announced, we promised that the merger would enable us to deliver more choices and lower prices for consumers. In our filing tomorrow with the FCC, we will offer detailed plans regarding how we will achieve those goals. These plans will further demonstrate why this merger is overwhelmingly good for consumers and in the public interest."
NAB Not Impressed
Predictably, the NAB refused to believe that the satcasters had done anything worthwhile. "Policymakers should not be hoodwinked by today's announcement, since nothing is stopping either XM or SIRIUS from individually offering consumers a more affordable choice in limited program packages, NAB EVP/Media Relations DENNIS WHARTON asserted. "Moreover, after reading the fine print, one discovers that XM and Sirius customers have to buy a new radio for an undisclosed fee to reap the alleged rewards from today's announcement.
"The history of antitrust law demonstrates that two hotly-competitive companies will promise anything to become a monopoly. That, coupled with the brazen lack of candor displayed by both XM and Sirius in breaking FCC interference and terrestrial repeater rules, illustrates convincingly that this anti-consumer merger ought to be summarily rejected."
Two New Anti-Merger Positions Announced
Adding their voices to the opposition of the XM-SIRIUS merger are NATIONAL PUBLIC RADIO, which filed a Petition to Deny with the FCC (the first programmer with material airing on the satellite services to file in opposition to the merger) and Sen. SAM BROWNBACK (R-KS), who wrote a letter to FCC Chairman KEVIN MARTIN and Assistant Attorney General THOMAS BARNETT in opposition to the merger.
NPR wrote that reducing the number of satellite operators to one "would substantially harm the diversity of voices to the detriment of SDARS program producers... and ultimately the public," adding that it is concerned that a satellite monopolisy "might reduce the amount and quality of public radio programming" on satellite and would "be able to demand less favorable licensing terms, thereby forcing NPR and others to decide between program quality and carriage."
BROWNBACK wrote that the merger "may result in higher subscription prices and fewer programming choices, and yield monopoly power to purveyors of highly offensive, sexually explicit programming that it is inappropriate and harmful to our nation's families, thereby encouraging the airing of incerased amounts of such programming."
Read his letter here.