Crowell & Moring was retained by the National Association of Broadcasters to look at the proposed merger of DARS competitors XM and Sirius satellite audio services. Like many other who have examined the proposal, they see it resulting in a government-sanctioned monopoly, and urge that it be rejected.
The firm stated, "The proposed merger would replace this duopoly market structure, set up specifically by the FCC to ensure at least some level of process and service competition, with a monopolist in the downstream subscription market…that is unrestrained in its ability to harm competition. There simply is no 'fix' that will restore the competitive structure of this marketplace, and thus DOJ should challenge the transaction to preserve existing and future competition."
On the critical issue of market definition, C&M notes that in the first place, it was determined at the birth of the satellite audio service that it was a separate marketplace from AM and FM radio, and two licenses were granted to assure competition. In the second place, internet-based services are not able to duplicate the mobility of DARS, nor are they likely to have the ability any time soon. In the third place, other audio devices like iPods and MP3s, like tape and CD players before them, are largely incapable of providing anything other than prerecorded programming.
