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On Monday, February 19, 2007 XM Satellite Radio and Sirius Satellite Radio made the long expected announcement that they were merging. While this is not yet a done deal because of potential regulatory hurdles it is good news for folks who have become addicted to satellite radio.

In the Future – No Decision Needed Between XM/Sirius
The biggest benefit we can see is that you will be able to buy any car and have the “right” satellite service in the car. For example, having been an XM Radio subscriber for two years I switched from my XM equipped Infiniti and leased a Volvo XC90. Volvo, being part of Ford, has an exclusive agreement with Sirius. So, even if Volvo had been offering a satellite radio installation in the XC90 (which in 2006 they were not! Dark ages!), I would have been forced to get Sirius.
What did I do? Well, XM offered me a Delphi Roadie at a ridiculously low price and it has been crudely mounted in the Volvo since then. Poor and spotty reception, but at least I have satellite.
Merger Recognizes Competition from Many Fronts
This merger is recognition that there is not room for two satellite radio providers in the USA. The subscriber base for XM and Sirius combined is under 15,000,000. Of course, for companies that began offering service just a few years ago, this may not be too bad but it’s not good enough for sustainable growth. Satellite radio is duking it out with iPod integration in cars, in-vehicle hard drives, high definition radio, traditional AM/FM. Competition is fierce and this merger will help satellite radio survive.

If you are a subscriber to XM Radio, you received this email on Tuesday, February 20, 2007:
Dear XM Radio Subscriber:
We want to share with you some exciting news: Yesterday, in Washington DC, we announced XM Radio will be merging with Sirius Satellite Radio to form the premier digital audio service.
The merger will create a satellite radio company that will provide consumers across the country with more and better premium radio programming. The combined company will be able to compete better in what has become a very complex and dynamic entertainment market.
Where today our exclusive contracts mean you had to choose between baseball and football or Oprah and Martha Stewart, the new company will seek to ensure that in the future, you will be able to access both companies’ programming. And, once we are fully integrated, those of you who have factory-installed satellite radio will no longer be limited to the programming provided by the exclusive satellite radio service chosen by their car manufacturer.
This merger should be completed in late 2007 or early in 2008. Throughout the year, we will provide updates on how the merger is progressing and information will be available at our website, www.xmradio.com.
Between today and the merger date, as well as during the period immediately after the merger date, all of your services will remain the same. The channel lineup, the customer service number, the great music technology, and the XM Radio web site will all remain unchanged and there will be no disruption to service. But, if you have questions, information will be available and maintained on our website, and you can contact our Listener Care team at 800-XMRADIO, with questions and concerns.
XM Radio continues to be committed to providing you the highest quality audio entertainment and customer service available today. After the merger, our new company will be able to offer you the most exciting listening experience in radio.
Sincerely,
Hugh Panero
CEO, XM Satellite Radio