Glad to see that the Sirius-XM merger got approval. The companies' competitors in the terrestrial radio industry had been making the self-refuting argument that a merged entity would face no competition on the theory, I guess, that satellite radio is a hermetically sealed market totally unaffected by the rest of the broadcasting and music industries.
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Merger
24 Mar 2008 04:53 pm
Comments (20)
This is true from the customer's perspective, but obviously not from supplier's viewpoint. Of course, such concerns should not be highly regarded in these matters, but as an IC designer, they matter to me.
Cool. My parents have XM, as has almost every rental car I've ever used with satellite. I've gotten to prefer XM, and I'm kind of in the market for a new car (don't need one necessarily, but it's time to start looking). I was already eliminating any make that exclusively sold Sirius. No longer, I guess.
This is DOJ approval. The more contentious part of the process has always FCC approval, which is still pending. The deal hasn't yet gone through.
Huh? Sure Matt, we saw how well intermodal competition worked after cable deregulation in the 90s. I guess the fact that public interest organizations such as Common Cause, Consumers Union, The Consumer Federation of America, Free Press, Media Access Project, and Prometheus Radio Project were all against this merger is irrelevant in the face of your ability to intuit the correct solution based on your general knowledge of markets. Being intelligent doesn't insulate you from having to study a issue prior to passing judgment. I'm assuming that Sietz is being sarcastic, because his statement demonstrates exactly why this merger should not be approved. If he isn't being sarcastic, wouldn't it also be easier if he also wasn't burdened with choosing between different types of cars?
Matt might want to, say, read the Clayton Act before getting too far into commenting on this subject. Specifically, in order to violate the Act, a merger need only substantially lessen competition, and does not necessarily need to create a monopoly.
DTM - have you read the Clayton Act?
MTD,
Yes, I have. The relevant portion is in Section 7 (codified at 15 USC 18):
"No person engaged in commerce or in any activity affecting commerce shall acquire, directly or indirectly, the whole or any part of the stock or other share capital and no person subject to the jurisdiction of the Federal Trade Commission shall acquire the whole or any part of the assets of another person engaged also in commerce or in any activity affecting commerce, where in any line of commerce or in any activity affecting commerce in any section of the country, the effect of such acquisition may be substantially to lessen competition, or to tend to create a monopoly."
Note the disjunctive "or" in the final sentence of the quoted portion.
So I guess what you're saying then is that it would be perfectly ok for Comcast to buy up every other cable provider - that any argument that that wouldn't necessarily be a good thing would be "self-refuting".
So the "pro-market" neoliberal line on this is that it's a victory for the market, since competition has not been entirely eliminated on all possible levels?
Please do not insult your readers. Anyone with half a brain can recognize (yet another) blatant example of capitalism working at odds to true competitive free markets.
I might be more exercised about this if it wasn't for the fact that land based radio can kiss my fat yellow butt.
Matthew is right. Sirius-XM is in exactly the same lines of business as FM radio: selling blips. Or, for that matter, AM radio. Who cares that FM/AM is shitty, and a merged Sirius-XM will only hire minimum-wage DJs?
It's all in the market definition. This kind of expansive definition also applies to CNN and Microsoft and the rest of the informatics business. IOKIYAR.
The key in "substantially reduce competition" is "competition." Satellite radio unquestionably competes with land-based radio; if it didn't, then the American Association of Broadcasters wouldn't care about the deal.
Also, why would satellite only hire minimum wage DJ's? XM doesn't do that now.
The key in "substantially reduce competition" is "competition." Satellite radio unquestionably competes with land-based radio; if it didn't, then the American Association of Broadcasters wouldn't care about the deal.
Also, why would satellite only hire minimum wage DJ's? XM doesn't do that now.
The key in "substantially reduce competition" is "competition." Satellite radio unquestionably competes with land-based radio; if it didn't, then the American Association of Broadcasters wouldn't care about the deal.
Also, why would satellite only hire minimum wage DJ's? XM doesn't do that now.
Isaac is right. The key to this deal is and always has been FCC approval. Just about everyone expected the DOJ to approve, but most think the FCC will kill this. It's unfortunate, because I think the NAB's argument that satellite radio doesn't compete with terrestrial radio is absurd on its face.
They were both on the fast track to bankruptcy anyway. Fat lot of good that would do for competition. Hell, they still may not survive. XM and Sirius just completely misjudged where the market was headed and invested craploads of money in bidding wars over flashy content only to realize that people would rather listen to their ipods. And just wait until people can stream things like Pandora over a mesh network in their car. The idea that these companies could have any market power is a farce.
bababooey bababooey
Just because there is some competition between satellite radio and AM/FM doesn't mean the merger would not substantially lessen competition. Again, a merger can violate the Clayton Act without creating a monopoly, meaning a company with no competitors at all.
In fact if you read the DOJ press release, most of their rationale had little to do with competition from third parties (although they did predict that eventually mobile broadband Internet devices would provide a competitive constraint for the merged firm). Rather, their point was more that for a variety of reasons (including long-term contracts with the car companies), there is now little competition between the parties, and hence little competition to be lost from a merger.
By the way, it is indeed obvious that the NAB's opposition was counter-productive from an antitrust perspective. So obvious, in fact, one might wonder just what the NAB thought it was doing.
And along those lines, one might note that the FCC is also currently reconsidering its media cross-ownership limits, that the NAB favors relaxing those limits, and that the government adopting an all-media market definition would support the NAB's position on media cross-ownership limits.
Comments closed April 07, 2008.
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Heads in the Sand
but that will reduce, by half, the number of places i can go to hear John Mayer !
Posted by cleek | March 24, 2008 5:02 PM