What Do Sirius and Blu-ray Have In Common? (Hint: Nothing Good).
February 16, 2009 at 16:51 PM EST
It’s tempting to blame the downturn for all the bad news hitting tech in 2009, but downturns have a healthy impact too. They burn away the brush of businesses that looked good enough on paper to keep raising money, but never quite worked in reality. Consider two stories in the news today: The possible bankruptcy of Sirius XM Radio in the next 24 hours and the looming ouster of its chief executive Mel Karmazin, and the slumping DVD sales that the so-called “winning” BluRay format is doing little to boost. Stick with me here: I realize satellite radio and DVDs are very different businesses. But if you look at how Sirius XM, Howard Stern, Sony, Hollywood studios and all their various fans and stakeholders got into this mess, you’ll see two things in common that are causing more problems for their continued viability than waning consumer spending and locked-up credit markets.