Jon Friedman of Marketwatch has published a lesson right out of the Antitrust 101 textbook. Entitled “XM-Sirius deal could be bad for consumers,” he makes the obvious case. “Such a competition-busting combination will hurt the public. When there is only one company in an industry — even a nascent one like satellite radio — the survivor is free to act complacently toward the customers. The lone company can be tempted to cut corners in service. It doesn’t have to worry about making constant improvements in programming, either, because it’s the only game in town. Crucially, the last company standing can also take liberties with pricing — because the consumers don’t have an alternative in the marketplace.”
RBR/TVBR observation: We found Friedman’s comments online, and we once again found a respondent take issue with opposition to the merger on grounds that anybody who so desires can simply kick off their own satellite audio service. The respondent in this case suggests that Clear Channel enter the biz. We think that’s a great idea – maybe Thomas H. Lee himself will walk down to the corner satellite and rocket mart right after the next shareholder meeting and get the project started up.
