The Motley Fool is running a story on a rumor that Google is considering a takeover offer for US Satellite Radio provider Sirius.
The merger between Sirius and XM has yet to be approved by Federal Regulators and hence Sirius would become a takeover target if the merger failed. Google is still seeking more inventory for its Adsense for Radio program; hence buying Sirius would provide it with its own radio network from which they could sell advertising.
It would be easy to dismiss the rumor as being fanciful, and many already have, however any serious Google watcher knows that Google’s ambitions seem to have very little or no bounds. The advantages of Google acquiring Sirius from an advertising view point are obvious, and Sirius also streams a portion of its content over the web as well; a service that would bring Google into internet radio broadcasting. However, there is one additional factor that isn’t being discussed much: Sirius’ Loral FS1300 satellites.
Sirius’ current three elliptical orbiting Loral FS1300 satellites are being primarily used for streaming the Sirius Radio service, but are planned to be used for streaming television as well. More importantly: they can push data two ways; the Loral FS1300 satellite being used by may other companies for that very purpose. In buying Sirius, Google would own 3 orbiting satellites (with one spare and one being built) which they could use to provide internet access or a related data service to the United States and Canada. Google + Sirius would equal Google being everywhere over the largest market in the world. Capacity may dictate a non-universal use for the satellites (such as providing an ISP service), but they could work for an in-car internet service or similar mobile function. Bringing highspeed, low cost internet access to the car has long been dreamed about, Google could be planning to do just that.
First, Duncan, I have honestly been enjoying your blog posts lately. They are more succinct than when you first started here (IMO, anyway), and, though I’d still estimate you write at least 40% of TC, I think you’ve been getting pickier in subject matter. So thanks!
Second, really good point on the satellites…
Duncan,
Whether this happens or not what a great job on the story.
Between, stuff like this and submarine cables on the coast of Australia (read this over the weekend), Google will soon acquire an airline business and run it based on Adsense:) Imagine how many ads you could serve up during a 5 hour coast to coast flight…..
Google- seems like google will own the internet pretty soon. Since its launch in 1998 Google had 43 acquisitions and 2 are in negotiations ( rumours ), also Google’s revenue for 2006 was over 10.4 billion US dollar,
Where is Google heading?
I agree with #1 (Noah) about Duncan’s rise in quality of posts.
Back on subject, I hope the Sirius and XM merger goes through, far more than Google buying them out. If Google is serious in this matter, I certainly hope they do not buy out Sirius, because I wouldn’t see Google lasting longer than 7-10 years from now.
Hmmm…. This makes sense…
Google need real Google Operating System. They worry about Microsoft buying Facebook.
The FTC should allow the sirius merger and declare Gaggle to be an OCE (Ongoing Criminal Conspiracy).
Just my two cents!
http://fakestev...er.blogspot.com
Google is seeking more inventory for its AdSense for Radio program, but the major benefit of having Sirius Satellite Radio is that it is commercial and advertising free. So if this deal actually happens, will Sirius abandon that business model?
I agree with Don #4. Google is at its prime right now but like google came along and outthrew many others there will be someone or some service that will outthrow google at some point in time as well.
Like Don said, Google might not last for more than 10 years and I can see why, Ambition is good but too much sugar can give you a bitter taste at the end
Agreed. Duncan – this is some good stuff.
Actually, TC has been pumping out a lot of good stuff since the Sunday night/Monday morning blitz. A lot more non-funded little guys with a real chance.
Great job – Thanks!
Damn, you some of you sound like you worked Microsoft and attack Google hoping not to buy Sirius.
Google is getting too big. Remember, what goes up must come down.
When do we reach the point where we will pay money again to not see advertising?
growth of sirius and xm has slowed. it is a proven failure of a business model with terrestrial stations broadcasting free without monthly fees, just lots of crappy ads. it is been proven for this medium since the beginning. google will take it back to market expectations, which is aligned with their online model anyway.
I have Sirus in the Jags.
I like it, only one problem: I don’t run it!
…and I don’t like that.
What to dooo? What to do!
http://fakestev...er.blogspot.com
One thing I can see is Google going after the set-top box, which those satellites will help with.
What else hasn’t Google put their hands on?
I can’t wait to see what happens to share price of Sirius tomorrow – a day trader’s dream. Based on the dilution and outstanding shares it would be a heck of takeover
http://www.leve...deas.com/?p=455
next up: printing ads on people’s foreheads. how about that 6 billion inventory or may be on the grocery bags. perhaps on the currency bills. oh how about designer watches? slices of bread? micky’s ears?
i love what google does with search, maps and mail. everything else has a better option out there. their free wifi has no takers (let along san francisco, even in mountain view). i sincerely hope they know what they are doing, and not pull another dell on us.
Sirius is a great product – innovative tail content, without ads!! G would kill it for me if they started to stream Ad Sense type ads along with my Stern or Grateful Dead channel. I don’t care how relevant it is, i’d rather pay $10 a month and enjoy the content.
And Google moves one step closer to creating Skynet…
This would be great.
Google seems to be spreading its wings everyday. What next I wonder.
Hi Duncan, that’s an interesting thought….Google could be aiming to get to those satellites that sirius owns more than the radio. If the antitrust stuff goes through, they could potentially buy a merged version of XM and Sirius. Then they would have a combined 25 mhz of bandwidth to play with. They could keep one of those services running the normal radio, and use the other for the applications that you mentioned…essentially fast mobile internet (think Google phone also).
However, since Sirius’ (and XM also?) satellites are specifically targeting the united states, when google wants to expand its services to Europe or elsewhere in the world, it will have major issues doing so.
This sounds interesting, really good point on the satellites…looking forward for the next!
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You shouldn’t think of them as three satellites but as one satellite that is hovering in a position not above the equator. A standard geosynchronous equatorial satellite would be too low in the sky to serve northern lattitudes and let the signal reach down into urban canyons. Instead, the three satellites take turns in the upper loop of their “figure 8″ orbit that is synchronized to remain above the US.
Wire
my understanding of the tech involved (and I’m not an expert, so forgive me if this is wrong) is that Sirius’ setup would be better to run data over, because at the higher spectrum they can pre-buffer better to allow for disruptions such as an overpass, that sort of thing. I’d also think alone Sirius is an easier target for Google where as the combined XM-Sirius would be a harder sell in terms of the cost of acquisition, both to the Google board and shareholders.
I don’t subscribe to either Siri or XM but i believe their business model is a monthly subscription, which used to be around $12, in exchange for no adverts. If these stations start google advertising they will have to lose the subscriptions from listeners – are customer listeneing to ads really worth $12 pm?
And Google moves one step closer to creating BIGBROTHER…
You know, the other day when commenting on the Google-Second-Life-Competitor, I was making up the part about Google offering players their favorite music to listen to (along with ads) while in-game. It just seemed logical. Pretty nutty that this could actually happen, though.
I used to have XM radio for about 2 or 3 years and at first I was happy with it but I slowly realized that I am only hearing the same music that I could hear over the free airwaves.
Even both XM and Sirius started airing ads on some of their channels anyway, so I decided that it wasnt worth my money anymore. The music clarity was something that I missed (until I got a new car with iPod dock) so I wouldnt mind listening to it again for free if it were ad supported.
Personally, I like the idea.
If Google acquires Sirius?
I’ll be cancelling my subscription to Sirius. I love the music without any ads being injected into my listing pleasure.
Hey !!
This is BS ….
A RUMOR…
Which doesn’t hold water…..
if this goes through Google will have a huge potential in radio ads.
The back and fourth between ads or no ads seems odd, especially on a site frequented by ‘techies’; I can’t imagine it would be all that difficult difficult to offer both services … one paid and one ad sponsored.
Let the market decide, if you’re selling ads worth more than $10/month, ditch the subscription model, if the subscription model continues to pull in more money than ads, continue with both.
Couldnt Google just make the radio free or super cheap by subsidizing with ads? Basically customers would only pay for the sat radio just like terrestrial.
The rumor was started by ClickZ’s Zach Rodgers just under a week ago with little to no substance behind it. Sorry, but it doesn’t hold any water.
With the pending merger between Sirius and XM, why would Google act on this now? The street is already assuming an 80% chance that the Sirius-XM merger will be approved, so the price is already baked into the stock. If Google buys Sirius now, they miss out on owning XM’s network and infrastructure as well…. but at no cost benefit.
It even makes less sense when you realize that Google and XM partnered with each other over a year ago. If Google is simply looking for more outlets of its dMarc/Adwords program, then if the Sirius-XM merger is successful Google can simply extend the relationship to go over both platforms.
A little background on advertising on satellite radio: While the music channels are commercial-free, the news/talk/sports channels are not. Sirius and XM are both shooting for 10% of revenue to be driven by ads, but haven’t reached that goal (yet).
For the technology side of things: Sirius and XM both have data services already in place (XM’s is further along with real-time traffic, weather and other prototype data services; Sirius also has some very interesting capabilities as well, but less mature). But remember it’s all one-way. The receivers in cars currently only have downlink capabilities – you can only pull. Yes, the satellites receive and broadcast data, but they’re essentially just a big ol’ bent pipe. In order for Google to setup a “connected car” scenario, they would need to equip the receivers with some sort of uplink capability. Not impossible, but a big stumbling block.
This whole silly rumor would only hold water if the Sirius-XM merger failed. Then you can bet with no uncertainty that either Sirius or XM (or both) will be snatched up at bargain-basement prices.
The major flaw in this analysis is the assumption that all spacecraft (or at least all 1300-series spacecraft) are created equal. In fact, each spacecraft is tailored to to meet the specific requirements of the customer, particularly its communications payload. The number of transponders, their power, their spectrum band, their beam footprint, etc. all vary from spacecraft to spacecraft. Thus, just because other 1300-series spacecraft can perform two-way data services doesn’t mean that the Sirius spacecraft can do so as well. For example, the spacecraft are likely optimized for uplinks from a handful of powerful ground stations, not millions of low-power subscriber terminals. There’s little evidence that FM-5 and FM-6 (the two spacecraft currently under construction for Sirius by SS/Loral) have dramatically different capabilities that would better support two-way data services.
Another major stumbling block is licensing. The Sirius system is licensed by the FCC and its Canadian counterpart for DARS (satellite radio) services. Adding two-way data services would likely require changing their license, a time-consuming process with no guarantee of success.
If Google really wants to get into the satellite broadband game, they certainly have enough resources to develop a customized system that would be better suited for the purpose than re-engineering an existing system — heck, SS/L is just up the street from them. Or Google could simply buy WildBlue, which is satellite broadband but not mobile (although with the use of a phased array antenna that might just be possible…)
Can Google buy Sirius and xm without permission of the FCC and the DOj.
I THINK THEY ARE CONTROLLED BY POLITICIANS WITH CONNECTIONS TO THE NAB. WHY ARE THEY ALLOWING MORE COMMENTS AFTER THE STOP DATE? THIS IS REDICULOS! I DON’T THINK WE CAN TRUST THEM TO DO WHAT IS RIGHT FOR THE CONSUMER.
FOR THIS REASON, I WANT TO KNOW IS THERE ANYWAY TO ELIMINATE THE NEED FOR THEIR APPROVAL?
Now people should know…why spending time on blog is a waste…sirius is now BK. What an idea to float. And take peoples time. Please do not spred rumors and waste peoples time with your abstract thoughts or thinkings.