Sirius-XM satellite radio deal: A mixed bag

(Credit: Automotive News)

Last week's merger of Sirius and XM is a mixed blessing for automakers, says Thilo Koslowski, an analyst with Gartner Inc.

Customers get more program choices, making the service more desirable. But having just one provider means automakers lose a point of distinction. "It's going to be tough as a vehicle manufacturer to differentiate your XM service from Sirius service," Koslowski says. "Now they have to tell consumers it doesn't really matter."

Every automaker has an exclusive deal with XM or Sirius for factory-installed satellite radio. Some promote unique services, such as XM NavTraffic or Sirius Backseat TV.

The first effects of the merger likely will show up in the aftermarket. Federal regulators have ordered that within nine months, the combined company, Sirius XM Radio, must offer receivers capable of getting both XM and Sirius programming.

Factory-installed interoperative radios probably won't be available that quickly, Koslowski says. In the interim, subscribers to one service will have a chance to get limited "best of" programming from the other using their current radios.

(Source: Automotive News)