Whether real or simply perceived, there seems to exist a stark difference in how business is conducted east and west of the Mississippi River. Eastern based businesses tend to more staunch and more conservative. Western based businesses seem to be more innovative and think more outside of the box. One is not necessarily better than the other, it just seems that there are differing mindsets based on geography.
Having lived on the west coast, as well as the east coast, and being a frequent traveller, I have a diverse and keen perspective how different things can be even in our own country. One thing is certain. The east coast has been hesitant to give up the suit, tie, and cuff links, while executives out west tend to be far more casual in their attire. The more easy going style out west is what brought us telecommuting, and flex-time. These innovations in business are not technical, but do lead to comfort levels for employees that make them take the extra steps for the company. In terms of synergy, the Liberty deal could be a virtual ying and yang of American business.
Sirius XM is an east coast company. They think more traditionally. Mel Karmazin recently said himself that he is not an innovator, but rather an operator. In a twist of events (or fate), Sirius XM found themselves with a heavy debt load that was due quickly. The company struggled in ever tightening credit markets to obtain reasonable financing, but were not having much luck. It was this circumstance that brought about the Liberty Media deal, and with it, a western thought process.
The Liberty deal can mean far more than an infusion of cash and financing of debt. There is potential that Liberty could bring an infusion of new thinking to Sirius XM. This likely has already started, but the real east/west synergy will begin when Liberty obtains the three seats (they can seek up to six) they are currently seeking on the Board of Directors. Over the next 2 years, there are many decisions that need to be made. From programming, to management, several key relationships are up for renewal. The insight and western thinking of Liberty could not have come at a better time. Some key moments in the next 24 months:
Mel Karmazin - His employment agreement expires in November of this year. Will Karmazin remain with Sirius XM, or will the company seek another direction. Karmazin has his fans and his critics, so the coming months will be interesting.
Scott Greestein - The Chief Content Officer has a deal that runs through July. Greenstein was instrumental in bringing content to Sirius during the time when XM was a competitor. Yes, the deals were expensive, but he did get them done.
