Sirius and XM Merger Approved, Finally

According to the Washington Post and other sources, by a 3-2 vote at the FCC, the Sirius-XM satellite radio merger has finally been approved. There were a few additional conditions agreed to by the two companies, including a "slap on the wrist" $19.7 million fine primarily attributable to XM, because some of the FM transmitters built into XM receivers were too powerful and interfered with conventional broadcasts. Also, some of their terrestrial repeaters used to provide better coverage in urban areas were both located in the wrong places and were too powerful, and thus they also interfered with conventional broadcasts.

Another condition was that both companies agreed to expedite the development of receivers that will work with both Sirius and XM, a promise that the two companies actually made prior to the launch of either company's satellite radio service, but that has never been carried out. The companies also agreed to freeze prices for three years (which they had, again, previously agreed to,) and to offer subscribers the option of picking and choosing channels from the two company's services (a la carte pricing), a capability that won't be available until dual Sirius-XM receivers hit the market.

In short, it looks as though the two companies made minimal concessions. Given that the U.S. Justice Department previously approved the merger even without these concessions, it's extremely unlikely that any other legal obstacles are likely to arise. Given currernt economic conditions, however, it's essential for the merged company to start cutting costs immediately, so I wouldn't be at all surprised if the merged company starts to drop duplicate staff and put much the same programming on both services as soon as possible. (Howard Stern on both Sirius and XM, perhaps?)

Are we not annoying? We are TiVo!

A couple of days ago, TiVo and Amazon.com announced that TiVo users will be able to purchase physical products from Amazon.com that they see on television. Let's say that Jay Leno is pushing a nose hair shaver on The Tonight Show; lucky TiVo users will be able to pause the show and buy the shaver, using only their remote control.

I don't know if one of those obnoxious icons, like the ones that TiVo uses to try to get users to record a particular show, will flash on the screen ("Click Here to Buy that Nose Hair Shaver"). Frankly, I'm already getting sick of TiVo interupting my late-night television viewing so that it can change the channel to record content that I have absolutely no interest in. They're selling my viewing information, my eyeballs, and now they're trying to sell me merchandise from Amazon.com.

It's getting to the point where the basic utility of the TiVo service, time-shifting, is becoming outweighed by the annoyance of putting up with a salesperson sitting in my living room, 24 hours a day. If the company offered some kind of trade-off--accept the plugs and ads, or sign up for Amazon Prime, and the basic TiVo service is free--I could justify what's going on, but they're doing nothing except making the service less, rather than more, valuable.

Therefore, I've decided to relegate my TiVo to the dustbin. I've enjoyed it, but I won't go back until they tip the value scale back in favor of subscribers rather than advertisers and merchants.

Big News: tvstrategies

For the last 18 months, I've been working with Steve Hawley at Multimedia Research Group (MRG). Steve is one of the world's leading experts on IPTV, and we teamed on a number of projects for MRG's clients. As you may know, I left MRG in June, but Steve and I have been looking for a way to continue working together. As of today, we've found it.

This morning, Steve and I announced tvstrategies, a market analysis firm focusing on IPTV. (You can find our press release here.) We're going to be launching with two series of reports: The first is called RadarScreen(TM) Reports, and they compare products and services head-to-head in seven key IPTV categories. The second series is Best Practices Reports, and they're case studies from IPTV Service Providers on how to increase revenues, improve efficiency and decrease costs.

As you can tell, we're focusing on Service Providers, which is quite a bit different than what Steve and I did at MRG, where our primary focus was on hardware and software vendors. We believe that the focus in the IPTV industry is shifting from Operators making their initial product acquisition decisions, to Operators working to maximize the revenues and profitability of their IPTV services. Our RadarScreen and Best Practices Reports will focus on helping Service Providers do what we consider their Big Three: Increase Revenues, Decrease Costs and Improve Efficiency.

I'll have a lot more to say about tvstrategies in the next days and weeks.

More Satellite Silliness

According to this article from Radio Ink, Ed Markey, Chairman of the House Telecommunications Subcommittee, wants the FCC to force Sirius and XM to freeze their rates for six years as a condition of their merger. National Public Radio has also chimed in--they want the firms to set aside 25% of their spectrum for noncommercial, emergency and minority-controlled programming. Both Markey and NPR want the combined companies to add HD Radio capability to their satellite receivers, an idea that was first proposed last year by iBiquity, the company that developed and licenses HD Radio.

Let's go down the list: Freeze their rates for six years. How can anyone agree to freeze their prices for six years? (Sirius and XM have already agreed to freeze their prices for three years.) If prices get too high, consumers will drop the service and the company will have to respond. Let the market decide.

Next, NPR's 25% programming set-aside (this from a network that claims to serve the entire population but that broadcasts, to my knowledge, exactly one weekly Hispanic-related and one daily African-American-related program.) If a music channel is commercial-free, as many already are on XM and Sirius, does that count? If that's the case, they may already be at the 25% mark. And, I guarantee you that XM already programs at least ten times as much minority-oriented programming a day as NPR, if not far more than that.

Finally, let's touch on the requirement to add HD Radio to satellite receivers. As I've written about previously, that's like requiring Comcast to put DirecTV receivers into their set-top boxes, or vice-versa. Now, however, we learn that it's iBiquity that originally floated the proposal. Of course iBiquity wants HD Radio in every satellite receiver: They'd get licensing fees for every satellite receiver sold, sell more equipment to broadcasters and, in turn, spur more sales of conventional HD Radio receivers, which means even more licensing revenue for iBiquity.

It's broadcasters who have the burden of making HD Radio successful, by giving consumers a reason to buy a receiver and by convincing automobile manufacturers to include HD Radio receivers in their cars, just as Sirius and XM did years ago. Making Sirius and XM subsidize HD Radio is ridiculous.

Here's what I really think is happening: Broadcasters are putting pressure on legislators to float all kinds of different restrictions on the Sirius-XM merger, which will delay the decision. Assuming that a deal is struck and the merger goes through, the civil lawsuits will begin in order to keep the companies from unifying their operations. The hope is that, eventually, either Sirius or XM will wave a white flag, the merger will be dropped, and one or both companies will go under. Consumers will lose an incredibly valuable choice (regardless of whether it's one or two companies).

Laughing on the Outside, Crying on the Inside

This isn't a financial blog, but it's no secret that both the NYSE and NASDAQ markets are in bear territory, banks are failing, tens if not hundreds of thousands of people are losing their homes, unemployment is up, and the economy is a mess. So when I turned on CNBC this afternoon, why did I see a bunch of nimrods at both markets smiling and clapping, when they both closed down yet again? Can't they put the "clap & smile" at the market close on hold for a while? It makes it look like Nero is in charge of our financial markets.

Measuring Traffic

I'm experimenting with multiple ways of measuring this blog's traffic (although that could be compared to hooking an EKG up to a dead body.) I've used Google Analytics for some time, as well as FeedBurner's stats. They're both Google services, but they measure different things: Google Analytics measures traffic to the site, while FeedBurner measures subscribers to my RSS feeds. Both are important in figuring out who's using the site and what articles get the most interest.

I've recently added IZEARanks.com and Quantcast. Both services gather usage statistics directly from the sites themselves, rather than from a sampling of Internet users. I've placed a bit of JavaScript into the right-hand column of my site for each service (if you're reading this as a webpage, just scroll down and you'll see them.) IZEARanks focuses exclusively on blogs, while Quantcast covers websites, blogs and other services.

IZEARanks.com currently offers three metrics: RealRank, Page Views and Unique Visitors. According to IZEARanks.com, RealRank is calculated by comparing all blogs in their system 70% on daily unique visitors, 20% by daily active inbound links and 10% by daily page views. Quantcast tracks number of monthly unique visitors and frequency of visits, but it also attempts to identify the demographics of visitors. Quantcast also has an interesting media planner feature that enables advertising media buyers to select sites based on their demographics, reach and other characteristics, and to compare sites on those same elements.

For now IZEARanks.com seems to be better for "bragging rights" for blogs, while Quantcast is setting itself up to be a real challenger to Nielsen//NetRatings and comScore. Bloggers don't have to pay a dime to use any of these services, so it's worth experimenting with them to find out which ones get you the best information and sales tools.

Evernote: My New Cool Tool

For years, when I've found an article on the web that I wanted to keep, I've printed the page. That wastes paper, and I usually end up throwing out the stacks of printouts. Recently, I've adopted Evernote, which allows me to save the articles both on- and offline. It supports Windows and Mac, most browsers, as well as Windows Mobile smartphones and now, iPhones as well. I was a very early beta user and ended up uninstalling the software because of problems it caused with my PC, but the glitches have mostly been worked out and it's now available to everyone in open beta.

If you run the desktop version, you can store documents locally; otherwise, your documents will be kept on their remote server. (You can also sync local and remote documents so that all your devices have access to your complete library.) You can organize documents into multiple notebooks, or repositories. Documents are searchable, tags can be added, links remain live, and you can always get back to the original webpage, even if you only clipped a portion of it.

The basic version of Evernote is free (that's what I'm using), but if you find yourself using it much more heavily than I do, you can upgrade to a paid subscription with more storage space. It's worth a try.

Obligatory iPhone 3G Post

If you were standing in line outside an Apple store this morning to get your iPhone 3G, once you got inside, you couldn't get your phone activated...AARGH! Things got so bad that Apple employees started unbricking phones so that customers could at least leave the store and activate at home using iTunes. Apple pointed its finger at AT&T's activation servers, while AT&T pointed back at Apple's iTunes servers. According to this real-time blog from CNET, it's pretty clear that the problem was with Apple--AT&T's problem wasn't with activation, it was with running out of phones.

On the other hand, if you wanted to upgrade your first-generation iPhone or iPod Touch with 2.0 firmware, according to yet another CNET article, you often ended up with a bricked phone. Blammo!!!

For all of you who had the patience to wait a while to buy an iPhone 3G, or who simply couldn't care less, have a nice day.

Apparently, I'm a Spammer...

Ever since I started this blog a few years ago, I've been asked to complete a CAPTCHA (that distorted graphic you sometimes see that's supposed to differentiate between a computer and a real person) when creating new posts. I didn't think anything of it until the most recent revisions in Blogger's draft.blogger.com site, which consistently hides the Captcha word verification box and buttons and makes it impossible for me to post entries (I've tried both Firefox 3 and IE 7, with no success.) So, I switched back to the old-style Blogger, and then clicked on the little "Why do I have this?" link, which explained that Google's massive computer arrays think that this is a spam blog. (I suppose that whether or not my writing constitutes spam is in the eyes of the beholder, but in this case, the beholder is a server with a dual-core processor.) They think that my blog is spam, but it's perfectly good to sell AdWords on. Hmm...

On July 3rd, I asked Google to review my blog and turn off word verification. They apparently forgot to look at it, because I just had to ask again. I'm getting close to moving the blog to my own website--no great loss of traffic for Google, of course, but a good example of how relying on algorithms rather than human reviews and common sense can sometimes result in unintended consequences.

CNN Can't Count

I just tried to play a video on the CNN website, and got this message:

This CNN.com feature is optimized for Adobe Flash Player version 8 or higher.

You are currently using Flash Player 10

Hmm, 10 is higher than 8, isn't it?

Camcorder News from Kodak and Red

I've got news about two camcorders, one low-end model that will act like it's more expensive, and one "expensive" model that will act like it's much more expensive. The first is the new Kodak Zi6, a pocket camcorder priced at $179.95 that will compete with Pure Digital's Flip Ultra and Mino. What makes things interesting is that, unlike the Pure and similar Creative Labs pocket camcorders, the Zi6 records in HD (720/30p), and according to Benny Goldman of Gizmodo, the video looks great on a 40" flat-panel TV. The Zi6 won't be quite as convenient as the Pure Digital models--it has no built-in software, and it comes with no memory (SD and SDHC memory cards with up to 32GB of flash memory will be supported)--but it can support both the low-end YouTube shooters and people who might have considered an entry-level HD camcorder from Sony, Panasonic or Canon. And, of course, it's got the Kodak name. According to Kodak, the Zi6 will ship in September.

The other camcorder is Red's Scarlet. Jim Jannard, the founder of Red, just posted a new rendering of the Scarlet on its Scarletuser.com website. As you may recall, the Scarlet will be a fixed-lens camcorder with 3K resolution (digital cinema-quality) that will sell for under $3,000. According to Jon Sagud of Red, writing in the same thread as Jim Jannard, the Product Requirements Document (PRD) is just being completed. In most cases, Engineering departments wait for a completed PRD before they start designing the final product, but the broad outline of the Scarlet's functionality has been known for some time. In any case, we're still at least nine months away from Red shipping the Scarlet.

The Scarlet can't help but have a big impact on camcorder sales in the $5,000 to $10,000 range. If you've got to have a camcorder in that price range right now, by all means go ahead and buy one. However, if you're looking at a fixed-lens Panasonic or Sony model in that price range and you've got some time, wait at least for IBC in Amsterdam this September to see what Red shows. If the Scarlet they've got there is still a non-functional milled aluminum model like the one they showed at NAB in April, you've got at least another six months, and perhaps as much as a year, to wait for the final product.

Rendering and Compression Power From GPUs

There's an excellent article over at ExtremeTech on the future of using the GPU on graphics cards for applications other than just displaying graphics on a display. They discuss Nvidia's CUDA language and ATI's similar, but somewhat more closed, equivalent. GPUs have tremendous parallel processing power; for example, ATI's new RV770 GPU has 800 stream processors.

The ExtremeTech article talks about how GPUs can now, and increasingly will be used in the future, for video encoding, decoding and transcoding, as well as rendering and effects in Photoshop. I believe that there's a tremendous opportunity for speeding up video editing and effects (especially rendering) in programs such as Premiere Pro, After Effects and Final Cut Pro. One big issue, of course, is that Nvidia and ATI are going off in their own directions, but as the article states, there are two standardization efforts--OpenCL, which is backed by Apple and a bunch of other companies, and DirectX from Microsoft--both of which are supported by Nvidia and ATI. Of the two, it looks like OpenCL may well be the more generalized platform for parallel application development, but we need to wait and see what DirectX 11 will be able to do.

The key here is that it will eventually no longer be necessary to throw out an entire workstation in order to get better video editing and effects performance--you'll simply be able to swap out a video card (or two or three or four). Apple is going to support OpenCL directly in its forthcoming Snow Leopard version of OS X; it's too early to tell what Microsoft will do with Windows 7, but there will undoubtedly be GPU application support, even if it comes from third parties.

Loony Advice from Our Legislators

I rarely cover satellite radio, but I've been following the Sirius/XM merger and the related governmental sideshow. I've been an XM subscriber for a long time, and I'm frankly disappointed by the merger; nevertheless, it's clear to me that XM and Sirius are probably never going to get to critical mass separately. The U.S. Justice Department has approved the merger, and the Federal Communications Commission has yet to rule, but FCC Chairman Kevin Martin has said that he's ready to approve the merger with some restrictions on the new company.

Today, three U.S. Senators (Claire McCaskill (D-MO), Ben Cardin (D-MD) and John "Snatching defeat from the jaws of victory" Kerry (D-MA)) asked Martin to impose two restrictions on the merger: First, the merged company would have to allocate no less than 20%, and preferably 50%, of its channels for leasing to minority and noncommercial information programmers. Second, satellite receivers would have to include electronics for receiving terrestrial HD Radio signals.

There's no question that the merger will create a monopoly in satellite radio, but the vast majority of consumers in the U.S. get their audio entertainment from terrestrial radio, CDs and digital media players such as iPods, not satellite radio. The Justice Department decided that the relevant market for determining whether or not a monopoly exists is audio entertainment, not satellite radio. Requiring the merged company to make as much as 50% of its channels available for leasing would effectively destroy its ability to reach profitability in any reasonable time. As for making the merged company's receivers also receive HD Radio, that would be like demanding that Comcast modify its set-top boxes so that they could also be used by DirecTV, or vice versa. It's up to terrestrial broadcasters, and not Sirius and XM, to make HD Radio successful.

As I said, I'm not a fan of the Sirius/XM merger; I think that it will reduce competition and consumer choice. Nevertheless, the remedy suggested by Senators Cardin, Kerry and McCaskill doesn't address these issues at all; it simply cripples the competitiveness of satellite radio versus terrestrial broadcasters.