Feds getting set to rule on XM/Sirius

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Executives at XM and Sirius expect to get regulatory approval for their proposed merger by the end of the year, according to a write-up in USA Today. Analysts are said to be unsure (although we’ve seen more thinking it will get done than not lately). Many of the watchdogs keeping an eye on the merger remain steadfast in their opposition. USA Today says that the DoJ may go public with its up or down thumb any day now, to be followed by the FCC.
The debate hinges on whether the two companies are seen as the sole competitors in a unique market, as they were originally chartered, or as just another couple of audio services along with radio, iPods, the Internet or whatever else one can name.


RBR/TVBR observation: Most broadcasters believe there are huge differences in the two businesses. A local broadcaster does not have over 100 channels at its disposal, and the satellite services need not pay any attention whatsoever to local idiosyncrasies, much less deal with local emergencies. Although both companies are still losing money, both say they can and will survive on their own if the merger does not go through. We’d strongly argue that the services are unique, and since their continued survival as competitors is not an issue there is no reason to grant a government-sanctioned monopoly.


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