Sirius & XM Radio Merger Mergers among companies is not a new concept, in fact, this concept has been used since the 1980s. There are a few reasons that companies decide to merge. A merge can increase the performance which produces a stronger company. A stronger workforce is the dream of all companies. Companies love the idea that they are able to produce a product in half the time. Diversification is another reason companies like mergers. A company that merges to diversify may acquire another company in a seemingly unrelated industry in order to reduce the impact of a particular industry's performance on its profitability. Companies seeking to sharpen focus often merge with companies that have deeper market penetration in a key area of …show more content…
In 2008 Sirius and XM Radio merged, which meant that officially the US only had one satellite radio provider. Satellite radio is a new concept that was developed in 1992. It uses spectrum “S” band for nationwide broadcasting of digital audio signals. Of the 4 companies that applied for a license to broadcast, 2 of them (Sirius and XM) paid upwards of $80 million each and received approval to broadcast from the FCC in 1997. They are still trying to get enough subscribers to get them out of debt (Walczak, J., 2016) .These companies earn revenue through customer subscription fees, activation fees, and advertising sales. I no longer had to just listen to whatever I could find on the radio, I have the ability to choose exactly what I would like to hear, when I want to hear it; is a concept that caused a stir in radio. The selling point of satellite radio is the thought of being in control. What once was two companies that had a great rival because they had a service that only they could offer, now they are one company? Rivals XM Satellite Radio Holdings Inc. and Sirius Satellite Radio are entering into a merger of equals that will create a satellite radio giant, the companies announced Monday. XM (Charts) and Sirius (Charts) said they would each own half of the combined company, which would offer listeners a much wider variety of programming, including sports, news and high-profile entertainers such as shock jock Howard Stern (Ellis, D., La Monica, P. R.,
-The American people were hungry for new music, so they accepted the independent stations of the majors.
Television, the phone, and the internet. These inventions have uniquely shaped the 20th century and have led to the 21st century being known as the age of information. These services are the primary ways we communicate, express ourselves, and reach out in our ever increasing global world. In the United States, these services are provided by a number of different firms, chief among them is Comcast, being the largest provider of Cable and internet in America, and a large telephone provider. Next to it stands Time Warner Cable, the second largest provider of cable in the United States. The decision for Comcast to buy Time Warner Cable for forty-five billion dollars in 2014 has led to many criticizing the merger, calling it a monopoly. Others have called the whole cable system an oligopoly. For it to be a monopoly or an oligopoly, it would have to fit their respective categories. The merger between Comcast and Time Warner Cable would not create a true monopoly, but would give it significant market power because it has monopoly resources and can be considered a natural monopoly. It will also further its power in a market dominated by oligopolies. People argue that it is not a danger to Americans for this merger to happen, but when one looks at the practices Comcast already uses, it paints
In the digital age, can Dish Network remain a leader in the television industry? What challenges does Dish Network face in the age of streaming? How does Dish Network remain competitive in an ever-changing environment? Below we will discuss a complete analysis of how the company functions inside and out, from the data warehouse and supply chain to the front and back-end customer interactions, sales and programs used for enterprise resource planning and customer relationship management systems.
INTRODUCTION Would people be willing to pay $12.50/month for commercial free radio beamed right to their car or home. Well two companies and many big investors are betting about $3 billion dollars that people are willing to do just that. In 1997, the Federal Communication Commission (FCC) granted a portion of the S-band spectrum for satellite radio and two companies purchased use of these bands and started the only two companies competing in the satellite radio business today, namely Sirius and XM. Analysts like William Kidd of CE Unterberg Towpin, predict satellite radio will generate about $10 billion a year in revenues by 2007 (McClean, 2001).
Another reason for combining the two companies is to increase its capital base so that it can be able to expand its operations and have sufficient funds to finance its projects which include goals and mission. Higher capital base in any company is important since the company can be able to diversify its projects and also increase its dividends payouts since there will be no need of retained
Satellite radio is a technology that provides a radically new way to listen to radio. XM’s service makes use of advanced satellite capabilities and elaborates terrestrial receiver architecture to deliver a wide array of high quality radio programming nationwide. In early 1998, Robert Acker, director of strategic planning at XM, needs to develop a marketing strategy for this new radio service. There are several decisions that need to be made by the company in order to finalize the business plan. At fist XM needs to decide which of two business models to pursue, whether emphasis should be placed on charging customers a monthly subscription fee, or whether to rely more on earning revenue through advertising. In addressing this problem, management must consider the value that XM radio could propose for different consumer segments as compared with existing modes of radio (AM, FM) and in relation to its sole competitor in satellite radio – SIRIUS. Besides choosing a business model there is also a need to explore how best to approach and leverage manufacturer and channel partners, considering high unknown and high-risk technology. The purpose of this report is to analyze possibilities and outline possible recommendation on strategies for XM Radio. The following areas will be examined:
When the word monopoly is spoken most immediately think of the board game made by Parker Brothers in which each player attempts to purchase all of the property and utilities that are available on the board and drive other players into bankruptcy. Clearly the association between the board game and the definition of the term are literal. The term monopoly is defined as "exclusive control of a commodity or service in a particular market, or a control that makes possible the manipulation of prices" (Dictionary.com, 2008). Monopolies were quite common in the early days when businesses had no guidelines whatsoever. When the U.S. Supreme Court stepped into break up the Standard Oil business in the late 1800’s and enacted the Sherman Antitrust Act of 1890 (Wikipedia 2001), it set forth precedent for many cases to be brought up against it for years to come.
XM Radio. Sirius’s direct competitor in satellite radio service is XM Radio, the only other FCC licensee for satellite radio service in the United States. XM Radio broadcasts certain programming that we do not offer. XM Radio service is also offered as an option on various car model brands, certain of which do not also offer SIRIUS radios.
XM Satellite Radio is a company that is different than many that we have seen in the past. This is due to the rather small number of competitors that XM had in their industry. Although radio has been around for decades, XM Satellite Radio was much different by opting to use satellites to send signals to radios while having a much higher level of quality. At the time of XM’s creation, their sole competitor was Sirius, making it very difficult for others potential competitors to enter the industry due to high regulation. Since XM only has one direct competitor in their industry, they have the ability to focus most of their efforts of how to gain an edge over Sirius Radio, rather than multiple competitors.
Sirius XM could be considered a monopoly in the world of satellite radio. Sirius XM seems to have the most prevalent presence in this industry. However, if there were a competitor for the radio itself Spotify and Pandora would likely be considered competition.
Conflict seems to inevitable when trying to merge two companies. Conflict is described as the “Process which begins when one party perceives that the other has frustrated or is about to frustrate, some concern of his” (Kumar, 2009). Synergon’s CEO uses a “take no prisoners” approach and would fire most of the management team within 12 months of taking over a company using an approach they call neutron bombing. In cases where both companies are successful like in the case of Synergon Capital and Beauchamp you add even more conflict. The managers of Beauchamp are used to operating in a positive way that has produced profits for the company and you add Nick Cunningham a manager of Synergon who is used to restructure management in newly acquired poorly ran
Direct Broadcast satellite (DBS) delivers hundreds of TV channels to millions of people around the world. Satellite owners buy slots in space and lease assigned transponder frequencies to service providers. In this paper, I briefly introduce the history and development of DBS, the major vendors of the products, and overall market situation. In order to illustrate why DBS is such a popular technology, I also give out the comparison between DBS and the traditional cable TV. Both of them have advantages and disadvantages. But the competitive advantages of DBS will make it attract more subscribers thus gain larger market share in the future.
Sources:Strategy and the Business Landscape, by Pankaj GhemawatBritish Satellite Broadcasting versus Sky Television. Harvard Business School Case
“He shoots!!! He scores!!!” these are famous words that Foster Hewitt made famous broadcasting a hockey game on the radio (“The Early Years”). It was words like these that the public became used to because there was no television. The radio served as the first medium to hear things live as they happened. This gave sport fans the opportunity to sit down and tune into a game anytime they like. The radio started off big and then took a dramatic fall due to the introduction of the television. However, radio found new ways to attract the public.
Mergers mean two or more companies combining together to form one business or firm. There are six different types of mergers: Horizontal, Vertical, Conglomerate, Market extension, Product Extension and Diversified activity.