The XM+Sirius+HD Radio

Inside Radio is reporting that at least one analyst (Blair Levin of Stifel Nicolaus) thinks the FCC may mandate radios that include HD plus satellite stations as a condition of winning approval for the XM-Sirius merger.

The HD Radio Alliance and iBiquity (the folks who brought you radio’s version of digital radio) have been lobbying for it.

Consumers have consistently voted down HD radio but radio’s self-appointed "super delegates" are pushing to influence the outcome in spite of what the marketplace is telling them.

HD by every standard has been a dismal failure. Consumers won’t buy HD radios at any price and broadcasters refuse to load HD stations up with new and appealing content. In some markets where big box stores like Best Buy sells HD radios there is virtually nothing to listen to once the consumer takes the radio out of the box.

Imagine buying an iPod and not having iTunes to derive content.

Radio is treading on dangerous ground again in its desperation to force the HD issue. The industry is drinking iBiquity’s Kool-Aid, but if they, along with public interest groups like Media Access Project, get their way and force the merged satellite companies to include HD on future satellite radios they are opening the door to something more devastating.

Wouldn’t it then be fair and in the public interest for satellite operators to be granted permission to use their repeaters as local radio stations?

That’s what I would argue if the HD proponents ultimately win the day on combination receivers. Satellite radio is sitting on top of hundreds of transmitters called repeaters. The NAB claims the satellite operators haven’t constructed them where they are supposed to be and allege some are operating at excessive power.

Satellite interests have supposedly outspent the NAB by ten times in lobbying, advertising and hiring lawyers according to Inside Radio’s article -- all over the merger issue.

From all indications, the merger will likely win DOJ approval. Hell, the DOJ approves just about everything. It will just throw a few conditions in and say they are acting in the public interest. This oddball and ill-conceived maneuver by HD proponents to mandate HD-satellite radios could be one of them.

Satellite radio customers don’t want – and I argue don’t need – a radio that receives HD sub channels. After all, they are consenting consumers knowingly opening their wallets for the expressed purpose of paying for content. They want satellite radio not HD. If they wanted HD, they'd buy HD radios -- which they are not doing.

In a few more years it all won’t matter.

As the next generation continues to come of age – the very young people radio folks make fun of and don’t understand will be showing the radio industry what happens when you fixate on technology instead of content.

Radio broadcasters are lost in what they think is the transmitter and tower business. That’s why these properties are often valued at hundreds of millions of dollars. To them, that's what radio is.

Satellite broadcasters sell hardware and offer programming that is less irritating (no commercials) and slightly more interesting than their terrestrial radio counterparts. They're in the consumer electronics business, but their value isn't in individual towers and transmitters.

Again and again traditional media comes up with technological “solutions” that are outdated and out of favor.

So when XM and Sirius finally win approval to merge (which they should) and HD proponents win the mandate to get access to satellite radio (which they may), don’t be surprised if satellite operators come back and lobby for use of their repeaters as local radio stations.

After all, what’s fair is fair.

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