The Evil Empire Vs. Satellite Radio

Clear Channel, sometimes referred to as The Evil Empire in the consumer press, has finally let the FCC know the merger conditions it is requesting should the Commission approve the merger of XM and Sirius. That is, after the DOJ decides.

Clear Channel is a minority owner in XM and has been for a long time. And, they provide some terrestrial programming for XM.

It must have been a good fit way back then because from the looks of their merger conditions, satellite radio is the evil empire -- not Clear Channel.

Here's what Clear Channel wants (in bold) -- with my comments:

1. No less than 50% of broadcast capacity be made available for lease to create "a viable competitive alternative" to the merged company.

Let me get this right. Clear Channel wants XM and Sirius to give terrestrial broadcasters half of its channels so that woefully inadequate terrestrial radio can wind up on their competitor -- satellite radio. That's as ridiculous as XM and Sirius demanding (at license renewal time) 50% of Clear Channel's towers and transmitters to air their programming. You know, as a viable alternative. This is laughable in many ways not the least of which is how it has disregarded what the satellite customer wants. Remember the customer? They choose to pay monthly fees for an alternative to terrestrial radio. If they want terrestrial broadcasters to provide them with content, they can simply hit a button in their car that says "radio" -- for free.

2. No less than 5% of capacity be set aside for public interest programming, modeled after the 4-7% requirement for DBS services.

A group called Public Knowledge made the same stipulation -- coincidence? You decide. This is simply pandering to the FCC on diversity and minority issues. I'll bet 5% of any terrestrial consolidators programming is not designated "public interest". These guys are proposing this stuff with a straight face, I assume. I don't know about you, but I'm laughing at them.

3. That Sirius-XM be subject to indecency regulations. Because, "one of the primary potential dangers to free, over-the-air radio posed by this merger is siphoning popular, including 'edgy' content, with consequent loss of advertising revenue."

Sours grapes. All things are not equal. Satellite broadcasters charge subscribers for their programming and these customers can opt out of edgy stuff. This is simply a way for an industry that lost Howard Stern -- and one that has to defend Don Imus -- to cry foul -- officially, that is.

4. Sirius-XM be prohibited from broadcasting local content.

I'll bet they'd like XM and Sirius to stay national. But those legal satellite repeaters that some argue are not necessary -- some as powerful as 50,000 watts -- stand ready to offer local competition to terrestrial radio. Wouldn't it be ironic if the cry babies at Clear Channel actually helped level the playing field for XM and Sirius with a what's fair is fair policy. Let's say radio gets its way on #1 (above) and XM and Sirius must cough up some of their channels to terrestrial broadcasters. Then, it's only fair that XM and Sirius can compete with local radio using their repeaters. Public Knowledge, by the way, is in favor of this.

5. Following #4, Sirius-XM be prohibited from receiving local advertising revenue.
And I guess what's fair is that if the FCC grants Clear Channel the right to lease 50% of their satellite channels, they, too would be prohibited from receiving local revenue. Right?

6. The FCC require that HD Radio capabilities be built in to all satellite radio receivers.

This is par for the course for a desperate radio industry that hasn't been able to get consumers interested in buying HD radios. It is a proven fact that consumers will buy satellite radios and then pay monthly subscription fees so why not reward terrestrial radio for failing by giving them another free ride on satellite receivers -- you know, the ones people are actually buying. The iBiquity people are on board with this one as if I had to tell you that.

So, there you have it.

Another example of why terrestrial radio consolidators are a joke. They fail their way to desperation. Want to hitchhike their fading fortunes to an industry that never made it. Satellite radio is a medium that has so many of its own problems that it is seeking this merger as a remedy in the first place.

Luckily no one will ever grant the Clear Channel wish list. No one is seriously listening to them.

In fact, increasingly fewer people are actually listening to their terrestrial radio stations. Or buying commercials. Both benchmarks continue to decline.

Oh, and if you fail to see the humor in The Evil Empire's latest Darth Vader strategy, you probably won't be laughing when you come to realize that WiFi radio is more important than satellite or terrestrial radio because it carries what all generations really want --Internet streams.

I'm sure in light of that which we have covered here, then, you won't be surprised that Clear Channel recently removed all its terrestrial streams from WiFi radio.

Can you see why these people have run their own business and the radio industry into the ground?

It's not just greed -- although it is that, too.

It's about incompetency.

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