Does Clear Channel Fear Satellite Radio?

Sirius (Nasdaq: SIRI) and XM (Nasdaq: XMSR) will be stepping up to the earnings stage over the next few days. The numbers are important, but the satellite radio providers are unlikely to stray from recent trends of steady subscriber growth and narrowing losses.

The real milestone in their reports? This will be the sixth time that each company has presented its quarterly earnings since the two announced their urge to merge more than 14 months ago.

What are we waiting for? The Department of Justice finally cleared the deal last month; now the FCC approval beckons.

You'd think that anyone objecting to the union would have pleaded their case a year ago, but it seems as if the killjoys are still trying to crash the party. Two weeks ago, Clear Channel (NYSE: CCU) sent a letter to FCC Chairman Kevin Martin, objecting to the deal on several different grounds.

Clear Channel's claims are not entirely without merit, but at the end of every point, one has to wonder what Clear Channel's angle is. If the merger isn't good for consumers, why would Clear Channel object, when it might funnel listeners back to terrestrial radio? If XM and Sirius don't have direct competitors, why is a terrestrial radio operator with an acquisitive past -- and a substantially larger company than both XM and Sirius combined -- hopping mad?

In truth, there are a number of technological innovations -- from hard drives in new Ford (NYSE: F) cars, to Apple's (Nasdaq: AAPL) iPod jacks as standard in-dash equipment, to Internet-radio-capable cell phones -- that now compete for commuter eardrums, the same way that satellite radio, terrestrial radio, and CD players have for years.

The very fact that Clear Channel would fire off a letter this late in the decision process is proof enough that it's not a disinterested party.

Come on, Clear Channel. What are you doing here? Won't it be easier to compete against one satellite-radio provider than two? Even if the cost savings lead Sirius-XM to become a more financially fit rival, you'll both ultimately butt heads against more cash-loaded digital music foes like Apple, Amazon.com (Nasdaq: AMZN), and Microsoft (Nasdaq: MSFT). Save your resources for the battles worth fighting.

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