I don't think the union of Sirius Radio (SIRI) and XM Satellite Radio (XMSR) is going to be overly satisfying to any particular shareholders. The merger into the new Sirius XM is supposed to cut $400 million in costs for 2009, and presumably, eliminate that amount of expenses forever more. That's fantastic. The problem is, the two companies lost about $1.2 billion between them last year.

Now don't get me wrong. I've seen plenty of stocks go higher even though the underlying company was losing money, and was likely to keep losing money indefinitely. I just don't think this is one of those cases. The market has spoken loud and clear about the merger, before and after it became official, by sending both stocks lower. That's a hint to me that maybe the problem isn't the way the competition is positioned within the industry; maybe it's the industry itself.

To their credit, both sides have ramped up revenue fairly consistently the last couple of years. To their discredit, they haven't exactly ramped up their bottom lines. The $400 million saved should help, but I'm wondering if it will be offset. XM Satellite is issuing $550 million in debt soon, and Sirius issued $350 million worth of stock earlier in the week. What's the net? And that's assuming that $400 million is actually saved and not just a dream. But that's not even the really odd part for me.

It wasn't a unanimous vote from the Department of Justice or the FCC, but both organizations approved the merger of the industry's only two players into becoming the only player. I'm no judge, lawyer, or philosopher, but that seems odd to me. Both agencies have balked at less threatening mergers, but this one for some reason made it through with some minor stipulations.

I'm wondering if they're seeing what I'm thinking. It's not that there's no competition in the industry. It's that it doesn't matter if there's not. That's the only conclusion I can come up with.

In that light, the two companies did $2.0 billion in sales between them last year. That's a lot, but isn't a drop in the bucket compared to radio, personal music players, and the like. Allowing the two to merge is almost a bit of an insult if you think about it. Just a thought.

Longer term, if XM Sirius ever even gets to the point of profitability (I'm not holding my breath) - I can then see other players jumping into the field. Not a bad idea. Let someone else break the ground, then follow the path they've laid. And, I have to think the up-start would have a better case to present to the FCC or Department of Justice. Both organizations could help the new competitor get started. I wonder who else is working on breaking into the satellite radio market.

Anyway, my point is this: I don't think the new XM Sirius is any better than either of the two former-competitors.

Price Headley is the founder and chief analyst of BigTrends.com.