Sirius XM Radio (NASDAQ:SIRI) is making plans to go on without CEO Mel Karmazin. The satellite-radio provider's board has promoted James Meyer, the company's president of sales and operations since 2004, to serve as its interim CEO when Karmazin steps down in February.
They key word is "interim," of course. It signifies that the company is still looking for a permanent CEO, and this move indicates that it was unlikely to find one before February.
Karmazin took the market by surprise in October by announcing that he would leave the company early next year. Things may have gotten testy between Karmazin and Liberty Media (NASDAQ:STRZA) CEO Greg Maffei in the days leading up to the resignation, but it seemed as if they were patching things up. However, with Liberty Media closing in on majority control of the company -- and Karmazin commenting in the past how he doesn't want to work for somebody else -- maybe this day isn't such a surprise.
No one is saying Meyer won't become the permanent CEO. Two of Sirius XM's biggest feats have been its ability to keep its subscriber count growing despite this year's 12% price increase and keep programming and content costs in check to deliver one of the better scalable models in media. Meyer deserves a lot of the credit there.
It still makes sense that Sirius XM doesn't have a permanent CEO to announce. Until Liberty Media's ownership issue is resolved, it would be hard to bring on a secure helmsman. Even without the Liberty Media overhang, it's hard to agree on what type of CEO the company needs next. Does it need a traditional radio guy?
Karmazin was just what Sirius XM needed at the time. He was a seasoned vet at CBS (NYSE:CBS) -- back when it was Infinity Broadcasting -- and he was able to apply his programming and operations knowhow to the coast-to-coast coverage of satellite radio.
However, Sirius XM's most recent initiatives have involved online radio. It began offering on-demand streams this summer and will be shortly rolling out a personalized streaming radio similar to what Pandora (NYSE:P) offers to its nearly 60 million active users. Maybe Sirius XM's next CEO has to come from the new media camp.
Either way, it belongs to Meyer now.
Running of the bulls
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Longtime Fool contributor Rick Aristotle Munarriz owns shares of Liberty Media. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.