The Used Car Salesman Side of Sirius’ Mel Karmazin
March 21st, 2007
Sirius Satellite Radio honcho Mel Karmazin is sounding more and more like a used car salesman as he tries to build political support for his controversial deal to combine the country’s only two satellite radio service providers.
Yesterday Karmazin was on Capitol Hill for the third time in recent weeks to pitch the mega merger in which Sirius would take over rival XM. As in previous hearings, Karmazin earnestly argued the deal would benefit consumers, even though it would transform two aggressive competitors into a monopoly.
Karmazin, who started his career peddling local radio ads, has always been a master salesman. He also has a reputation of doing whatever is needed to close the big deal. One of the biggest was a $500 million pact to lure shock jock Howard Stern to Sirius in 2004.
That salesman side of Karmazin was in clear evidence at yesterday’s hearing. Faced with mostly skeptical senators, he hinted the merged company might be willing to offer customers the option of picking and choosing certain channels of programming rather than their current all-or-nothing offerings.
Such “a la carte� programming has become a hot button issue in Washington in recent months. Federal Communications Commission Chairman Kevin Martin has been pushing hard to get cable television providers to adopt it, as have many members of Congress.
Ever the salesman, Karmazin coyly hinted the merged company might refund a small chunk of change to subscribers who opt not to receive certain adult-themed programming, such as the Playboy Radio Channel.
It’s getting to the point where we would not be surprised to hear Karmazin offer to throw in free floor mats and undercoating.
For the sake of consumers, we hope Congress, the FCC and the Justice Department will drive an extremely hard bargain with Sirius and XM. If the companies are not willing to offer solid, verifiable consumer protections, the regulators and politicians need to say “no deal.�
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