NAB, watchdog renew attack on XM/Sirius


Academic/attorney J. Gregory Sidak, on behalf of the Consumer Coalition for Competition in Satellite Radio (C3SR), says that there has been no substantiation to the claim that XM and Sirius are in anything but a competitive marketplace built for two, and should not be allowed to reduce to one. NAB noted that "they recognize that following the Commission’s legal standards would kill the merger, so they try to kill the standards instead."

Slidak claims that much of the merger proponents argument rests on the assumption that new technologies will emerge to compete with satellite radio. "The fact that entrepreneurs may be designing new audio devices in their garages does not inform the ultimate question of whether, over the next two years, SDARS customers would substitute away from SDARS to another audio device in response to a relative change in prices," he said.

Slidak provocatively accused Sirius of price fixing, since it promised a la carte offerings if, but only if, the merger is approved, which Slidak "…calls a breathtaking admission of critical antitrust significance." He explained, "It is an agreement not to compete over the pricing and unbundling of currently bundled content. Rarely do price-fixing cases contain such conclusive evidence of a meeting of the minds between two competitors to refrain from competing with one another."

NAB said that the two satellite services "make no attempt to demonstrate compliance with the DOJ/FTC guidelines and instead urge the Commission to ignore them." It argued that "acquiescence to such an approach would be arbitrary and capricious, inconsistent with [FCC] precedent, and set the Commission’s merger review process on a risky course."