The RUsirius.com Blog

26 March 2008
Is Clear Channel really being clear? Do they really expect the Federal Communications Commission to censor satellite radio? Apparently that's part of what the broadcasting giant is proposing to the FCC as one of the conditions of a merger between XM and Sirius that has already been approved by the Justice Department. Why? Because Clear Channel, which is itself in the process of being taken private by Bain Capital, believes that it will be easier to compete with a merged satcaster if all those bad words Howard Stern uses were to be silenced. The market for expletives, pornography and toilet humor is just so great that no decent programming can possibly compete head-to-head. While this argument is of dubious value at best, let's accept it at face value. This means that in order to compete on a level field, Clear Channel needs to restrain satellite radio. In other words, no Howard Stern. But there is another solution. Untie the hands of the terrestrial broadcasters on HD Radio. Allow them to use whatever language they wish, anytime they wish on their digital subcarriers. This would, of course, require the FCC to change their decency rules but that's certainly within reason. The decency rules have been around since Marconi and it's about time they were changed anyway. HD Radio broadcasts are the ideal way to do it. Since the HD signal is digital the case could easily be made that the content is not readily available to the general public. Besides, if digital HD Radio could say the kinds of things that just can't be said on analog radio this might provide the kind of incentive for customers to buy-in to the new technology without restraining the satcasters. It's an idea worth considering.

10 February 2008
What's wrong with HD Radio? According to a recent report by Inside Media, 2007 wasn't really the "breakthrough year" heralded by iBiquity. Instead, the sale of over 300,000 units was really just a "drop in the bucket" compared with the size of the overall market. If that's true then the folks at the HD Digital Radio Alliance can only look ahead to this year and hope that maybe this is the long awaited "big one." But what is the real motivation for HD Radio sales? Can it be CONTENT? Apparently the geniuses in the National Association of Broadcasters think HD Radios will just fly off the shelves because the technology is so good. Therefore most stations can just broadcast the same stuff on their HD subchannels that they broadcast via their standard FM or AM signals. And this is what most of them do. The "HD" light turns on but the listeners don't. There's no special programming. No local news or sports. No live performances from local venues. No promotions for local artists. No reggae, bluegrass, jazz, blues or comedy. Just the same old stuff. Fortunately, the sad current state of affairs offers a unique opportunity for the NAB to build a national network of HD content targeted specifically at Sirius and XM. The channels of this network can be similar to those offered by the satcasters but broadcast on various HD subchannels in each market. Such a network would offer direct, head-to-head competition for satellite radio with no subscription charge. It would be different. It would be lively. It would be creative. And it might just give HD Radio a real "breakthrough year."

27 January 2008
Fairness. It's not just a word but a policy. And it may have something to do with why it's taking so long for the proposed merger between Sirius and XM to be approved. Why? Because the "Fairness Doctrine" is something that has been imposed on broadcasters in the past to prevent them from presenting only one political point of view. If a station carries Rush Limbaugh it has to carry Al Franken. If it carries Michael Savage it has to carry Janeane Garofalo. This is the policy that had been in effect until the mid-1980s. It's the reason there were no political talk shows prior to that time. Establishing a loyal audience for programming representing two separate and distinct points of view is just too difficult for broadcasters, who can generate more income by simply turning to music, sports talk and comedy. So let's return to the present where there is now serious consideration in the political community of bringing back the Fairness Doctrine. For the reason previously described this would pretty much eliminate political talk programming on the terrestrial airwaves. The satcasters, however, can offer another option. Because both Sirius and XM have channels catering to both liberal and conservative points of view they can easily satisfy the Fairness Doctrine without having to alter their programming. And this is something that just has to be apparent to the Federal Communications Commission and the Department of Justice as they ponder the merger.

28 December 2007
Somebody finally gets it. The folks at iBiquity are asking that the Federal Communications Commission require that XM and Sirius incorporate HD Radio receivers into all satellite radios as part of their proposed merger. This is the first move in the right direction for terrestrial broadcasters. HD Radio technology offers them an ideal way to compete directly with the satcasters without fighting the merger. It is also a great step forward in upgrading audio technology for all of the listening community. If HD Radio simply comes with all satellite receivers listeners will have a true choice. They can pay for satellite radio or listen to HD Radio for free. The move also motivates terrestrial broadcasters to upgrade to HD because they get to piggyback HD Radio receiver sales onto the satellite radio marketing machine. In addition, with the introduction of iTunes Tagging by Apple, the XM/Sirius/HD receiver has the capability of offering listeners a true smorgasbord of listening and recording enjoyment. This is the kind of competition that is capable of opening the marketplace to new sounds, new artists and new ideas. iBiquity should be congratulated.

24 November 2007
They must be kidding! Does the National Association of Broadcasters really expect us to believe that there is some kind of groundswell of public opinion against the Sirius/XM merger? Apparently the esteemed organization has been sending out bogus email notes to the Federal Communications Commission stating some kind of opposition to the proposed deal. They're making two mistakes. The first is thinking that nobody would bother to investigate. Wrong! The Washington Post did and had a hard time finding any alleged objectors. The second mistake is actually thinking that there is anyone out there who even cares enough about the merger to bother to object. Face it, the only ones who really care about the Sirius/XM merger are satellite radio enthusiasts and the National Association of Broadcasters. Sure, there are other voices but they are mostly on the side of the merger, and for good reason. Informed individuals know that a healthy satellite radio business is good for the telecommunications industry in general. By pushing the envelope of technology, satellite radio helps cultivate a market for all kinds of technology. Internet radio, podcasting, Slacker, Pandora and, yes NAB, HD Radio all depend on a healthy and competitive environment to stimulate the marketplace. So stop kidding and start competing. It's the best path for everyone ... even the NAB.

15 October 2007
"A dog ate my homework!" That's a common protest heard from many a youngster trying to explain a missing assignment. It's an example of a cheap excuse, something made up at the last minute in an attempt to avoid an undesirable outcome. Unfortunately, it's the kind of tactic currently being pursued by the National Association of Broadcasters in their attempt to stop the merger between XM and Sirius. In case you haven't heard, the NAB is asking the Federal Communications Commission to suspend its consideration of the proposed merger so that it can go through documents obtained under the Freedom of Information Act (see RUsirius.com news story dated 12 October 2007). The situation is clearly getting desperate for the NAB as they feverishly attempt to derail what they see as an imminent threat to their business. But why? Is the NAB telling us that they feel they can't compete with a unified satellite radio organization? If this is true it's only because terrestrial broadcasters refuse to compete on a level playing field with the satcasters. And the issue is content. The NAB somehow believes that its members cannot compete because they don't have content that lives up to the standards set by the boys in New York and Washington. This is an insult to their listeners. Terrestrial broadcasters need to provide the kind of programming that can't be offered on a national basis. This means shows specifically tailored to the tastes of their local communities and promoting local artists, sporting events and businesses. Prior to the development of HD Radio this may have been difficult. But the new technology offers local broadcasters opportunities they've never had before. They can broadcast concerts from local clubs and theaters. They can provide different kinds of music ... jazz, blues, bluegrass. The kinds of things the satcasters are providing but tailored to the local audience. They can even broadcast shows on the Internet for global consumption, making use of "iTunes Tagging" (see RUsirius.com story dated 12 September 2007). They just need to get busy, stop whining, and start competing. There's still a world out there for terrestrial radio. Explore it. Woof!

16 September 2007
There seems to be an endless supply of organizations and arguments against the proposed merger between Sirius and XM. The latest comes from the American Consumer Institute. The organization is claiming that since the satcasters control the distribution of programming like Howard Stern, Opie and Anthony and Martha Stewart there is really no competition from other sources. This is like saying that David Letterman has a monopoly on top ten lists. Even if it's true, so what. Despite the fact that nationally distributed programs may only be available via satellite, not everyone wants these programs. Those who do can elect to pay the satcasters for them. Those who don't can choose to listen to competing programs using conventional radio, the internet or HD Radio. Yes, there is an alternative to satellite radio for those wishing to find it. Wi-Fi is available in hotels, bars, restaurants, coffee shops and gas stations across the country. Eventually "hot spots" are going to be made available over wide areas, permitting listeners to tune in to internet radio wherever they may be. Conventional radio may not appear to be offering much competition at the time but this condition is going to have to improve. Why? Because the terrestrial broadcasters are going to have to come up with something to attract listeners away from other media. And they even have the technology to compete head-to-head. The technology is HD Radio. The American Consumer Institute says it wants competition based on current technology and programming. But technology is continually evolving. To constrain the market based on what is currently possible is shortsighted. There are always new ideas. And that is the real competition.

28 July 2007
Come one, come all! It's satellite radio's new "a la carte" menu. Pay less, get less -- only the channels you want. This is the approach being taken by XM and Sirius to get the Federal Communications Commission to approve their proposed merger. It may be a reach but it's good business. Why should someone who only listens to classical music want to pay for Howard Stern? Why should sports fans pay for jazz? Just give the customers what they want and reduce their monthly bills. But let's extend this idea and make satellite radio even more competitive. Why can't Mellow Mel & Company offer a limited set of channels that are free and are supported by commercials? This is an idea that has been suggested on this website as early as 2004 (see RUsirius.com mail message dated 19 January 2004). Perhaps the time has now come. A few, say a dozen, channels offered free of charge but with commercials would provide an enticement to prospective subscribers to pay a small monthly fee to get a little more. From those who don't care to subscribe the merged company could still generate income through advertising. The only hurdle would be that imposed by the FCC since one of the provisions of satellite radio's license is that it be by subscription only. But Sirius has already circumvented this provision by offering lifetime subscriptions. The FCC could even control the content of the free channels to prevent the use of four-letter words and lewd suggestions. In other words, no Howard Stern Show, a program already supported by...commercials.

14 July 2007
In his puerile song "The Soft Parade" Jim Morrison talks of foolishly petitioning the Lord with prayer. The National Association of Broadcasters is now petitioning the Federal Communications Commission with a jejune piece of prose aimed derailing the proposed merger between XM and Sirius. Appealing to "long-standing Commission policies against spectrum monopolies," the NAB wants the FCC to prohibit the deal. Why, we should ask, does the merger have anything to do with spectrum monopolies? Both satcasters offer a wide variety of entertainment, news, and commentary. Neither satcaster assumes a specific political position on any subject. Both provide the kind of programming that members of the NAB have refused to broadcast in their continual quest for cash. In the terrestrial world inhabited by the NAB there is a de facto monopoly created by an organization that allows all of its members to do the exact same thing on multiple stations in the same markets. There are thousands of radio stations all owned by the same companies like ClearChannel and Bonneville. It's a good deal for the NAB and they want to keep it going. Wouldn't you?

9 June 2007
"Imagination is more important than knowledge," said Albert Einstein. This is a quote that has apparently never been seen by anyone at the National Association of Broadcasters. Their president is resorting to letter writing to Mel Karmazin in an attempt to get Sirius and XM to abandon their merger plans. President David Rehr 's comment that "gains resulting from a merger of Sirius and XM will largely accrue to Wall Street and the companies' executives and not African-American, Latino or other programmers or consumers," looks like an attempt to rally the support of minorities to the NAB cause. What cause? The defeat of the "big bad corporations" who want to consolidate the satcasters, crank up the subscription fees and deny the public access to specialty programming. If they had any imagination, the NAB would realize that if the scenario they say they fear plays out it would afford them a unique opportunity. Terrestrial broadcasters, through their new HD Radio technology, could offer the public creative and innovative programming tailored to a variety of audiences ... without any monthly fees. Instead, they have decided to fight the Sirius/XM merger in the hope that by preventing the satcasters from consolidating they will eventually force both of them into bankruptcy. Terrestrial broadcasters would then once again be able to dominate the industry as they always have. What a brilliant idea! But then again, they ain't no rocket surgeons.

3 May 2007
There are currently four ways to deliver music to the mass market: analog terrestrial radio, HD Radio, satellite radio, and Internet radio. A recent decision by the U.S. Copyright Royalty Board threatens to remove one of them. By raising the royalty fee paid by Internet broadcasters the CRB is effectively putting many if not all Internet webcasters out of business. The decision is misguided and has been made in the belief that Internet radio listeners can digitally reproduce webcasts and sell the content at a profit in violation of copyright laws. There are three problems with this line of reasoning. First of all, few if any webcasters play an entire recording uninterrupted, making it difficult if not impossible for a copyright violator to collect all the selections from a single recording and re-market it. Secondly, even if copyright violators were routinely copying and reselling material the distribution of music on the Internet represents a valuable distribution and marketing tool for the music industry. They may not think so but the more a particular recording is heard, the more interest there is. This eventually translates into sales. Finally, webcasts represent a primary means of downloading iPods and other devices. In addition, webcasters provide a market for music and information that would not otherwise be heard. Significantly increasing the royalties paid by webcasters does more than just raise a little cash and eliminate what is perceived as an annoyance. It reduces competition. And that is what the CRB decision is really all about.

22 April 2007
Competition. It's a word with at least two meanings -- competition for money, competition for ideas. The National Association of Broadcasters, in its quest to quash the merger between Sirius and XM, has elected to emphasize competition for money. The satcaster merger eliminates competition for money and therefore constitutes a monopoly. But what about competition for ideas. Each satcaster has hundreds of channels operating in separate frequency bands. It's unlikely that any of these channels will merge. The only merger is between the operating companies. It would be just like terrestrial radio where companies like Clear Channel and Infinity own hundreds of stations, each with a different content and format.

Wait a minute! Did we say terrestrial radio? Yes, the terrestrial broadcasters have had it this way for years and nobody has ever said a word about competition, at least not competition for money. When it comes to competition for ideas, however, the situation is a lot different. There is very little competition for ideas because the terrestrial broadcasters all feature the same programming, the same artists, and sometimes even the same shows via syndication. They all compete for a larger share in the same market. That's why every radio market in the nation has at least two country stations, contemporary rock, classic rock, half a dozen news stations and little else. Nobody wants to hear about jazz, blues, bluegrass, classical, reggae or numerous other musical genres. Not even all the syndicated programs can be heard in every market. But because no single company owns all the stations in one market competition is said to exist. There is no monopoly.

But what if one station in a single market decided to change its programming dramatically. Maybe a local country station would switch to blues or bluegrass. Could this ever happen in today's market? No, because of the fear factor associated with a format switch. Would the new programming find an audience? Could the station sell commercials? Would the station be able to continue to make money? Any kind of a switch from the status quo could is just too risky. At least that is the common belief among broadcasters. And that's where satellite radio enters the scene.

Because satellite radio is programmed nationally rather than regionally it has the advantage of being able to take a format risk. Various kinds of programming can be made available because the satcasters can offset small audiences with larger ones. Sirius, for example, can offer jazz and blues programming as long as it has Howard Stern and the NFL. Local broadcasters haven't been able to do this. Until now. With the entry of HD Radio, local broadcasters can provide interesting and innovative programming on a digital subcarrier and offset the small audience until it grows into a bigger one. The local country station can broadcast bluegrass in one of its HD subcarriers. A local rocker can have an HD blues channel. Because everything is digital, the audio signal is just as good as satellite radio except for one thing. It's free.

So terrestrial radio has a very effective way of competing with the satcasters. It can choose to offer new programming, broadcast in digital, and emphasize to its audience that it's all free. There is no subscription charge, no hidden cost. Just purchase an HD receiver for $100 and start listening. But the National Association of Broadcasters would rather stop the merger between Sirius and XM in the expectation that the satcasters will ultimately fail and everybody can go back to business as usual. It's like Theodorik of York, the old Steve Martin gag on SNL. "Can this be the beginning of a new era in broadcasting, where everyone gets to hear new music, new formats, new personalities? Can it be that radio will finally emerge from years of decline? Could satellite and terrestrial radio co-exist and offer listeners true competition for ideas?. Nah!! Let's just sue the bastards and hope they'll go away."

12 April 2007
One of the things that Ronald Reagan understood was that people didn't like getting pushed around. This is particularly relevant in the broadcasting business, especially in the case of radio personality Don Imus. The perpetually indignant man, who has made a fortune making fun of everyone, including himself, is now in the process of being unceremoniously kicked off television and maybe even radio. Why? Because he and his staff made a few comments about a women's basketball team. His comments were rude and insensitive and should not have been made. They were also funny if taken properly. As he himself told Al Sharpton, he is not a social critic, a writer or a journalist. He is an entertainer. During a career spanning over 35 years he has given many of us a reason to laugh while fighting traffic and a topic of discussion at the water cooler. And he didn't like getting pushed around. It may be time for him to get Sirius.

4 April 2007
As Butch Cassidy said to the Sundance Kid, "Who are these guys?" Regular visitors to this site have known that it has been posting a link to the Consumer Coalition for Competition in Satellite Radio (C3SR). A putatively noble cause, this organization seeks to keep the satcasters honest by promoting healthy competition in the industry. Recently, however, it has been learned that the National Association of Broadcasters (NAB) has been funding C3SR although they won't acknowledge by what amount. This development may not be as bad as it looks but it is still indicative of a desire by terrestrial broadcasters to return to the old way of doing business, when they owned the market. They apparently think that by stopping the merger between Sirius and XM they can get rid of satellite radio altogether, not a bad strategy considering that Mel Karmazin has said that the primary reason for the merger is survival.

Unfortunately, one of the benefits of satellite radio is that its presence forces terrestrial broadcasters to provide more interesting and creative technology and programming. We're already starting to see this with the development of HD Radio and the introduction of locally-oriented programming on HD channels. This offers a reasonable alternative to satellite radio and and environment in which both the terrestrial broadcasters and the satcasters benefit. Listeners get to choose whether to listen to local radio personalities and formats or to listen to national and international programming via satellite. The choices can be expected to increase the general interest level in the medium and raise the overall customer base. This, in turn, may eventually result in a fee reduction by the satcasters as they attempt to attract more listeners away from HD Radio.

If the NAB, by funding C3SR, expects to kill satellite radio it means that they have all but abandoned any attempt to compete by improving the quality of their product. Instead, they want to go back to doing what they have always done best which is to provide the same dull programming in all their markets as they compete for a bigger and bigger piece of the same pie. Keep the money trench open and don't worry about the listeners. If you're the only show in town, they'll show up. If the folks at C3SR are really an organization dedicated to keeping the satcasters honest by promoting competition, they're worthy of our support. If they're just a front for the NAB, shame on them. The listening public deserves better than this.

15 March 2007
"Beware the Ides of March" Caesar was warned. Those of us interested in satellite radio may want to take this warning to heart as well. The recent exaggerated reporting of subscriber statistics by XM Canada may just be an isolated incident or it may be part of a general trend. What XM Canada has chosen to do is to report as subscribers satellite receivers that have been installed in vehicles by their manufacturers, even before they have hit the showrooms. At best this is called an "accounting anomaly." At worst, this is called "cooking the books" and it has led to the downfall of Enron and Boston Chicken and to indictment against boxing promoter Don King. What makes matters worse is that drivers have been the principal target of the satellite radio industry from its inception. Any trend toward artificially inflating the number of vehicular listeners can have a negative impact in the marketplace. Satcasters already get to count as subscribers drivers who have recently purchased an automobile or truck with a satellite radio pre-installed by the manufacturer. These installations generally come with a free three-month subscription. The problem is that these subscriptions are not always renewed. Unfortunately the industry is too new to evaluate listener statistics with any degree of significance. Activities such as those now practiced by XM Canada only add to the confusion. What's next? Reporting as listeners former subscribers who have died? What the hell! Dead people have been voting in Chicago for years. Maybe even Caesar.

11 March 2007
It seems there's a lot of fear out there in terrestrial radioland. The belief is that the immense sums of money associated with satellite radio will easily overwhelm the meager resources of local broadcasters, even with the addition of HD technology. A recent article in the Indianapolis Business Journal echoes the concerns of media consultants who are apparently obsessed with programming such as Howard Stern, Oprah and Major League Baseball. What the consultants don't seem to realize is that this is the kind of programming that got radio into trouble in the first place: too many stations playing the same music, news, commentary and sports. Local radio owners mindlessly pursued the same programming hoping to milk the market for whatever they could get. They now must realize that with the advent of HD Radio they have the opportunity to provide the kinds of programming that can't be provided by the satcasters, all from a local prospective and all free.

8 March 2007
It is worth noting that terrestrial radio is fighting back. The latest move, the sale of HD receivers at Wal-Mart, can be expected to contribute significantly to the public's awareness of HD Radio as well as to provide a larger listener base. Because HD Radio is supported by but independent of terrestrial radio it has the capability to provide not only digital clarity but the kind of independent programming currently only supported by satellite radio. In addition, because HD broadcasters are local rather than national, they have the capability to focus on local issues and communities. A good example of what can be done with the new medium is Pride Radio , a station catering specifically to the Gay community in North Texas. If programming like this is possible, it should also be possible for HD broadcasters in other areas to cater to local news and events, local musicians and comedians, and local political activities. This does not mean that HD Radio can replace satellite radio as a medium. The national satcasters have big budgets and are capable of providing the kind of programming not possible on the local level. Nevertheless, there is a place for HD Radio, perhaps a significant one. Unlike satellite radio it's friendly, familiar and free.

26 February 2007
"Imagine being able to drive from Los Angeles to the Canadian border while listening to the radio and never having to change the station. Great, but who really does this?" Thus began a commentary on this website in 2000, when RUsirius.com was just getting started. Now, it seems, satellite radio is realizing that it has do do a little more than just provide technology in order to compete. What it has to do is to provide content that competes effectively with terrestrial radio. And, at least in local markets, it now has to deal with HD Radio, a technology that can provide the same sound quality as satellite radio and with no monthly fees. There is also internet broadcasting, iPods and other MPEG storage systems. The response from the satcasters is to merge in order to make their systems more cost effective but is this enough? Check out the recent editorial from Newsday .

20 February 2007
Laissez les bon temps rouler! Get out the costumes, blow the horns and hit the bars! It’s Mardi Gras 2007 and the moguls at Sirius and XM have announced their merger plans. Good for them! Now maybe they can get down to the business of running satellite radio as a legitimate competitor with terrestrial broadcasters.

Terrestrial broadcasters? In case you haven’t noticed, the National Association of Broadcasters has been quietly introducing its latest technology, designed specifically to compete with satellite radio. The HD Radio Alliance, an organization affiliated with digital radio innovator iBiquity, has been gradually installing HD modulators in radio transmitters across the country. And the trend is continuing, with automakers like BMW actively jumping on the bandwagon. The technology promises to provide the same quality of sound possible with satellite radio, and potentially the same variety of entertainment. HD Radio, you see, provides two digital subcarriers for each FM and AM station that signs onto the program. This means that each market can provide listeners not only with digital quality sound but also with innovative music and talk programming that until a year ago could only be spacecast. The drawback, of course, is that there are commercials and, of course, no profanity. But for those of you who don’t particularly care to hear the occasional F-bomb HD Radio offers a reasonable alternative to XM and Sirius. And here’s a real selling point: it’s free.

Naturally the Federal Communications Commission together with the Department of Justice are expected to attempt to strike down the proposed Sirius/XM merger. Their problem is that the union of the two satcasters would eliminate competition. If one takes a careful look at the overall state of the broadcasting business, however, one immediately observes that the competition is exactly what should be: terrestrial radio. This observation should lead the Government regulators, or at least the courts, to the logical conclusion that the merger between Sirius and XM should be allowed to proceed.

So all’s well that end’s well, right? Not exactly. The merger between Sirius and XM eliminates competition within the satellite radio business. Although HD Radio offers significant competition to the business as a whole, the quality of the satellite content can be expected to decline as the united satcaster consolidates its assets and reduces its talent pool. This means less variety and fewer choices for the listener. Unfortunately the alternative could be worse: the end of satellite radio. The radio listening community has some tough decisions to make over the next several years. The choices are exciting but the path may very well lead to an environment similar to what we have today: lots of stations all broadcasting the same programming in an attempt to maximize profitability and to expand the bottom line. Let the word get out. The money trench is officially open for business. Plus ca change…