Research Firm's Thoughts On Satellite Radio Flip-Flop After NAB Pays Them

News You Should Have Read Elsewhere

from the full-of-it dept

We noted yesterday a new report saying that a merger between XM and Sirius would be bad for consumers. It was being played up because the firm behind it, The Carmel Group, wrote a similar report a few years ago about the proposed merger between Echostar and DirecTV, which it says played a significant role in getting that deal blocked. What was a little bit more telling about the supposedly independent report was that it was paid for by the National Association of Broadcasters, the group representing terrestrial radio owners that’s using plenty of shady techniques in its fight against the satellite radio merger. A key part of the Carmel report and the NAB’s position is the assertion that the two satellite radio companies only compete with each other, and not with other forms of audio entertainment (terrestrial radio in particular), though the more the NAB beats its chest, and the more loudly it objects to the merger, the more this claim is undermined. Now, as if Carmel’s credibility wasn’t questionable enough, the folks over at Orbitcast have dug up an October 2005 report from the firm — written by the same person, no less, but not apparently not paid for by the NAB — that takes the exact opposite position.

From the new, NAB-supported report:

Sirius and XM make an argument that is critical to the success of this proposed merger. They state that their competitive landscape presently includes all forms of terrestrial radio (i.e., analog AM and FM, digital HD and Internet radio), as well as digital services such as MP3 devices and music-to-cellular telephones. This position is ludicrous. In fact, nothing could be further from the truth.

Now, from the October 2005 report the NAB didn’t pay for about the wide array of competition satellite radio faces:

Jump forward another 10 or so years and today the U.S. is pitched in a new battle over the same kind of telecom development, where again, the pie grows and numerous competitors thrive, side-by-side. In this case, the new player is satellite radio, with more than seven mil. subscribers, and its competition comes in the form of traditional analog AM & FM radio, as well as burgeoning services like MP3 players, terrestrial radio, and video- and Internet-to-the-vehicle.

So which is it, Carmel — or does that depend on who’s footing the bill? This sort of shilling is par for the course with the NAB, who’s also hired John Ashcroft to lobby for it, but only after XM denied his sales pitch.

It’s probably worth clarifying the general feeling about the XM-Sirius merger here at Techdirt Towers. We’re skeptical that the merger would really help the two companies, and we don’t particularly care whether or not it does. What we can’t abide by, though, is the NAB’s behavior, because it’s so symptomatic of the way entrenched industries try to restrain and inhibit new competitors. Rather than competing in the marketplace, they use political influence and shady PR tactics to try and hamstring upstarts and rivals. It’s preposterous that a group like the NAB can act like it’s this great consumer watchdog that wants to promote competition in the marketplace when its very actions make it clear that the last thing it wants to do itself is compete. If the NAB really was so concerned about competition and ensuring that consumers benefit from it, it would welcome satellite radio and all other competitors as further motivation to improve its own product and further satisfy consumers. But that’s the last thing terrestrial radio, or so many other entrenched industries, want — hence the deplorable, dishonest and underhanded tactics.