said by Harddrive:
maybe Mel will get fired after this is all over.
Fired?! I bet they increase Mel's bonus package when this is all over. SXM's board will be more pleased than angry with Mel over this. You've lost sight of what really happened here. This whole thing--from start to finish--was a great deal for SXM's stockholders. Certainly not a great deal for their subscribers, but for the corporate entity.
The RIAA sued SXM to collect royalties. SXM settled that suit, agreeing to pay royalties. SXM charged their customers more than
the monthly royalty fee they were paying RIAA. What SXM said at the time they imposed the for-profit royalty fee was, Well we have to make up past royalties as part of the settlement. What SXM did not say they would do (and of course did not or will not do) was roll back the royalty fee to the actual ongoing royalty fees they are paying RIAA once they had paid off that past due amount. It's totally unregulated. And it's profitable for SXM.
In effect by settling with RIAA and inflating the fee, SXM got an illegal rate increase. The under-the-table rate increase was illegal for a time because SXM promised the feds at the time the merger was approved to not increase subscription rates for a period of time which if I remember correctly expires sometime this year. That was the basis for a slam dunk class action suit to force SXM to refund the profitable portion of the royalty fee to those customers paying them. From the POV of the subscriber, we're not talking big money here. It's about $0.50 - $1.00 per month covering only the brief period of time between paying off past-due charges from the RIAA until the merger agreement not to raise rates expires. But in the context of 20 million subscribers, it's significant cash for SXM.
So, predictably, SXM gets sued over the illegal rate increase. Lawyers for a plaintiff get it ruled as a class action. And then they settle. Did they settle for a refund to customers of profitable fees? Nope. They settled for something that cost SXM almost nothing and is worth the same nothing to SXM subscribers who paid an illegal rate increase. And who pays both sides' legal bills for the class action suit under the settlement? SXM does.
What SXM did here was engineer both sides (RIAA vs. subscribers) of this dispute in their favor. It wouldn't surprise me in the least if SXM itself was not behind this class action suit, because what it did in effect was make it impossible for subscribers to recover the illegal rate increase.