Karmazin Talks Merger With Howard Stern, O&A

Stern And Karmazin

SIRIUS XM RADIO CEO MEL KARMAZIN stopped by HOWARD STERN's show WEDNESDAY morning to discuss the company's merger, joking that "we hired a team of 100 people" to come up with the name "SIRIUS XM" ("HOWARD, have I ever been known to hire 100 people?") and calling the long wait for a merger decision from the FCC "dreadful -- there was no reason for this merger not to take place." He said that the long delay affected retail sales of satellite receivers by putting doubt in consumers' minds and restricting the companies' ability to market the service.

Voicing frustration with the process that delayed the merger and saw politicians urging the FCC to deny the merger based on broadcasters' lobbying, KARMAZIN called the two FCC "no" votes, Commissioners MICHAEL COPPS and JONATHAN ADELSTEIN, "very nice, very smart people who have never seen a merger they would approve," and said he should "thank the NAB for their objection to this merger" because it proved "that we would compete with broadcasters." He said that until the merger was formally approved, he had doubts that it would happen, and even had doubts after the approval because of the enormous debt SIRIUS had to raise to close the deal, but said that SIRIUS would have survived whether or not the merger took place. 

KARMAZIN set SEPTEMBER or early OCTOBER for offering "best of" packages for $4/month, enabling XM subscribers to get a package of selected SIRIUS channels (including STERN's) and SIRIUS subscribers to buy a package of XM channels.  He said that present receivers would not become obsolete, and that the present separate systems would exist for "at least ten, a dozen years" until new satellites allow the technical operations to merge.

Mel Visits Op And Ant

OPIE AND ANTHONY reacted WEDNESDAY to BUBBA THE LOVE SPONGE's on-air assertion that if they continue with the combined company after the merger, they would be "dealbreakers" that would lead to his leaving satellite. "He's making up his own excuse, because maybe the future isn't too bright for him on satellite radio," said OPIE. "He's as dumb as they come."

Later in the morning, KARMAZIN visited OPIE AND ANTHONY on XM, reiterating some of the same themes he discussed on STERN, including the benefit to the merger argument of the NAB's rabid opposition. "They're not lobbying every merger," KARMAZIN said of the NAB. "Why should they care?"

Addressing the elephant in the room, OPIE asked KARMAZIN, "Did you or did you not bring pink slips for us?" KARMAZIN noted that he'd done that once before (at WNEW/NEW YORK), laughing that he was always nice to O&A but they "acted like dicks." KARMAZIN told O&A that he took the duo off the air after the "SEX FOR SAM" incident and did not let them out of their contract because he wanted to avoid having them compete against him. "If I can pay you not to compete, why on earth would I want you to compete?", KARMAZIN asked. He and O&A discussed the conflicts between them and STERN, with KARMAZIN likening it to players fighting with others on the same team; OPIE said that their motive was to prevent STERN from "hurting our stock... let's make sure he doesn't do to us what he did to (PHILADELPHIA host JOHN) DEBELLA...."

Reminiscing about their previous run-ins, KARMAZIN also said that O&A were put on WNEW rather than STERN's station, WXRK (92.3 K-ROCK)/NEW YORK, because WXRK GM TOM CHIUSANO wanted a non-controversial afternoon show to pick up advertisers who would not advertise on STERN's morning show (CHIUSANO later became O&A's GM when they were picked up to replace DAVID LEE ROTH at WXRK, then WFNY-F (92.3 FREE FM)).

KARMAZIN said that he had not discussed OPIE AND ANTHONY's contract situation and claimed not to be aware of what they make, but called them "important" and said that if they want to stay and XM management wants them to stay, he would facilitate the discussions.  However, he noted that the payment for a show that also appears on terrestrial radio (using SEAN HANNITY as an example) would be lower, and added that the BUBBA THE LOVE SPONGE deal (a "compromise") carved out specific markets not critical to SIRIUS subscriber growth to allow him to do a separate terrestrial show.  O&A's show airs on WXRK and other terrestrial stations as well as on XM, with a separate two hour show aired only on XM.

And KARMAZIN would not commit to saying that O&A would be offered in the "Best of XM" package to SIRIUS subscribers, nor would he say whether O&A would be able to keep their "THE VIRUS" channel rather than being placed on another channel.

"Well, that didn't go too well," OPIE quipped after the interview.

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