Many people fought for the title of stupidest logic yesterday.
The proposed merger of the nation’s two satellite radio companies came under sharp criticism yesterday from the chairman of a Senate panel that monitors antitrust matters, who said consumers probably would suffer if the deal goes through.
“You’d be virtually unrivaled, unchallenged in this area,” said Sen. Herb Kohl (D-Wis.), chairman of the Judiciary subcommittee on antitrust, competition policy and consumer rights. “You’d have no competition — what a business!” he told Mel Karmazin, chief executive of Sirius Satellite Radio, at a two-hour hearing.
Right, and satellite radio subscriptions are price inelastic. Whatever the merged company wants to charge me, I’ll pay. I’m a sucker and an automaton. If the merged company offered a service to take over my financial well-being and make choices for me, I’d give up control in an instant. I am beholden to the power of Mel Karmizin.
That’s pretty bad, but this is like what I expect to say after a kick in the head.
Mary Quass, chief executive of NRG Media, a radio company in Iowa, said local AM and FM stations cannot match Sirius’s and XM’s ability to send scores of channels to every corner of the country. Listeners and advertisers might abandon local stations, she said, and “consumers will be the losers.”
If listeners abandon local radio stations, they, as those consumed, will choose to “lose”. This makes sense in what understanding of reality? The government needs to step in because I might make a decision to abandon local stations. I’m unable to know that I’d lose by doing this. Thanks, but I can make up my own mind. Local stations already lost me, anyway. There are only so many Yuk Yuk D-Double-E-Jays I can suffer, and I’ve already passed my lifetime limit.
Of course, a company like Clear Channel owns lots of local stations, all over the country. Somehow this seems like radio companies send “scores of channels to every corner of the country”. Ms. Quass’ objection surely has nothing to do with being CEO of a competing radio company.
Just for fun, I like this euphemism for central planning of the essential satellite radio product:
Gigi B. Sohn, president of the advocacy group Public Knowledge, urged the government to set price caps and other restrictions on the merger. “We believe that a properly conditioned merger would be in the public interest,” she said.
Baseball gloves are “properly conditioned”. Hair is “properly conditioned”. This is plain vanilla government regulation designed to give consumers what they “should” get and to protect specific
donors constituents. No doubt the latter decides the former. Goverment knows best, after all.