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Done Deal: XM-Sirius Merger Approved
WASHINGTON -- July 25, 2008: The FCC has made its long-awaited decision on the merger of XM Satellite Radio and Sirius Satellite Radio, and the deal has been approved.
"The merger is in the public interest and will provide consumers with greater flexibility and choices," said FCC Chairman Kevin Martin in a statement on the decision. "Consumers will enjoy a variety of programming at reduced prices and more diversified programming choices. It will also spur innovation and advance the development and use of interoperable radios, bringing more flexible programming options to all subscribers."
A last-minute dispute over merger conditions between Martin and FCC Commissioner Deborah Taylor Tate had led many to think approval would be further delayed, but on Friday night Tate cast the deciding vote.
The NAB had lobbied fiercely against the merger, and NAB EVP Dennis Wharton released a brief statement that read, "Today's vote certainly comes as a disappointment to NAB. We continue to believe that consumers are best served by competition rather than monopolies."
XM and Sirius earlier confirmed that they expected to agree to pay $19 million in combined Treasury contributions to settle outstanding enforcement issues involving terrestrial repeaters. Other conditions expected by the companies include XM's shutting down or bringing into compliance 100 terrestrial repeaters while Sirius does the same for 11 repeaters, and the adoption of comprehensive compliance plans by both companies.
Conditions earlier agreed to by the satcasters include a three-year price freeze, interoperable receivers within a year after the merger, and 24 channels set aside for public interest and minority programming. There may also be an inquiry on whether new satellite receivers should be HD Radio-capable -- a proposal raised by HD developer iBiquity last year and embraced by a number of lawmakers and public interest groups.
FCC Chairman Kevin Martin and Commissioner Robert McDowell were already on record as favoring the merger when Commissioner Michael Copps on Monday cast his vote against it. Copps' fellow Democratic Commissioner, Jonathan Adelstein, voted no on Wednesday after a slate of tougher conditions he'd proposed in return for a yes vote didn't generate interest from his fellow commissioners. Tate's conditions were the last points to be negotiated, and, after a delay while Tate reportedly refused to sign the merger approval until Martin had signed the consent degree settling the enforcement matters, the deal is now done.
XM and Sirius announced plans to merge back in February of 2007, despite an FCC rule prohibiting the combining of the only two satellite digital radio services. Since the merger's proposal -- and particularly since the Department of Justice granted its unconditional approval in March of this year -- many parties have weighed in on the deal, with members of both the House and Senate, public interest groups, and a number of state attorneys general urging either denial or heavy conditions on a merged XM-Sirius.
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