FCC Commissioners Will Approve XM-Sirius Deal

a1aara · Post by **a1aara** » July 23, 2008 9:32 pm

FCC Commissioners Will Approve XM-Sirius Deal
Satellite-Radio Merger
Will Pass After Firms
Pay $20 Million in Fines
By AMY SCHATZ and SARAH MCBRIDE
July 24, 2008

Commissioners at the Federal Communications Commission have reached a tentative deal to approve the proposed merger of Sirius Satellite Radio Inc. and XM Satellite Radio Holdings Inc., FCC officials said Wednesday.

Commissioner Deborah Taylor Tate is expected to cast the final and deciding vote on the deal shortly, the officials said, after details are resolved on several outstanding enforcement issues. In exchange for her vote, Ms. Tate and FCC Chairman Kevin Martin have been negotiating with the companies to pay upward of $20 million in fines for violations regarding tower locations and power limits, people close to the negotiations said.

The companies are valued at $7.5 billion combined.

The deal will allow Sirius to make a big marketing push at holiday time, traditionally a big selling period for satellite radio. Within three months, the company is expected to have new à la carte radios on the market. These will allow consumers to mix and match 50 or 100 radio stations from the two services.

Even without a new radio, consumers will have new options. For example, a bare-bones plan of just 50 stations from one of the two services will cost $6.99 a month, compared with $12.95 for more than 100 stations currently. Consumers will also likely soon see a number of programming changes as the companies get rid of redundant programming.

For the companies, the deal will come at a steep price. They are expected to enter into a consent decree, with XM paying about $17.5 million and Sirius paying about $2 million, to settle complaints they produced satellite radio transmitters that exceeded FCC power limits and placed booster towers in unapproved locations.

The deal would resolve the issue of stronger-than-permitted radio receivers and repeaters, which take satellite signals and transmit them to radios in many urban areas. The companies have tried to modify overactive repeaters and tweak newer radio models, but the quirk has led to satellite-radio signals bleeding into some local-station signals.

Ms. Tate has suggested a variety of other conditions. People close to the negotiations said these wouldn't significantly change terms already agreed upon by the companies. In June, the companies agreed to a three-year price freeze for existing customers. They also agreed to set aside about 8%, or about 24 channels, of their combined lineup for use by educational and minority broadcasters.

Notably, the deal wouldn't require the companies to include technology in their radios allowing consumers to receive digital signals from local radio stations. That is a blow to broadcasters who want to expand the number of consumers who listen to their new digital stations.

An adviser to Ms. Tate didn't respond to a call for comment. Exact details of the deal are unknown because FCC officials and company lawyers are still working them out.

Ms. Tate's vote would end the agency's 13-month review of the deal and would clear the final hurdle for the merger, which was approved by the Justice Department in March. Ms. Tate's vote was critical, since the FCC's four other commissioners were split evenly on whether to approve the deal.

The new options that would be available through the merged companies, including the bare-bones plan, could significantly reduce churn, or the number of subscribers who ditch the service each year, said Tony Wible, an analyst at Citigroup. As the economy enters tough times, he said, many consumers might prefer to switch to a low-frills option rather than cancel.

XM declined to comment. Sirius didn't respond to requests for comment.

Write to Amy Schatz at Amy.Schatz@wsj.com and Sarah McBride at sarah.mcbride@wsj.com

aeroparrot · Post by **aeroparrot** » July 23, 2008 9:33 pm

This has been around since 2:30 PM

Post by **SMLCHNG** » July 23, 2008 9:49 pm

Got this info on Monday.. all very interesting.

More Twists and Turns on Sat Radio Merger

More twists and turns tied to the ongoing merger effort between XM and Sirius have surfaced inside the Beltway.

For starters, The Associated Press reported that Jonathan Adelstein, one of two Democratic commissioners at the Federal Communications Commission, would support the deal if the companies would agree to an expanded set of conditions. Those conditions include a cap on prices for six years after the merger (instead of a much-talked about three-year cap) and setting aside a quarter of satellite capacity for non-commercial and educational programming (rather than an original 8 percent mentioned in the press).

Adelstein also would like to see a merged satellite radio entity provide capabilities for HD Radio in satellite radio reception equipment, stated news reports. In addition, the FCC commissioner would reportedly want an independent body to ensure that a merged company adheres to any conditions.

Along with that talk came more pushes from consumer advocacy groups on the pending merger.

In a filing made at the FCC late last week, Public Knowledge and the Media Access Project argued that a single satellite radio entity should allow device manufacturers to incorporate technology into satellite radio receivers such as HD Radio, iPod ports and internet connectivity. The merged company also should permit any device manufacturer to develop equipment that can deliver a merged company's satellite radio service, they stated in their joint filing.

The groups also said the FCC should appoint an independent monitor to oversee compliance with any merger conditions.

chippewa · Post by **chippewa** » July 23, 2008 9:55 pm

Next few months should be interesting to see how this plays out. A $6.99 entry price and a six-year cap on pricing could get me to take the plunge.

a1aara · Post by **a1aara** » July 23, 2008 10:11 pm

Adelstein Reverses, Votes Against Satellite Merger
FCC Commissioner Jonathan Adelstein this morning (July 23) voted against the proposed Sirius-XM merger after the satcasters refused to embrace any of the conditions he proposed to win his support for the deal, R&R has confirmed.A source familiar with the merger tells R&R that “it was clear that the plan was not going to get anywhere -- particularly with the chairman [Kevin Martin]. He was serving as a proxy” and the satcasters would not budge "on anything."

SMLCHNG wrote:Got this info on Monday.. all very interesting.

More Twists and Turns on Sat Radio Merger

More twists and turns tied to the ongoing merger effort between XM and Sirius have surfaced inside the Beltway.

For starters, The Associated Press reported that Jonathan Adelstein, one of two Democratic commissioners at the Federal Communications Commission, would support the deal if the companies would agree to an expanded set of conditions. Those conditions include a cap on prices for six years after the merger (instead of a much-talked about three-year cap) and setting aside a quarter of satellite capacity for non-commercial and educational programming (rather than an original 8 percent mentioned in the press).

Adelstein also would like to see a merged satellite radio entity provide capabilities for HD Radio in satellite radio reception equipment, stated news reports. In addition, the FCC commissioner would reportedly want an independent body to ensure that a merged company adheres to any conditions.

Along with that talk came more pushes from consumer advocacy groups on the pending merger.

In a filing made at the FCC late last week, Public Knowledge and the Media Access Project argued that a single satellite radio entity should allow device manufacturers to incorporate technology into satellite radio receivers such as HD Radio, iPod ports and internet connectivity. The merged company also should permit any device manufacturer to develop equipment that can deliver a merged company's satellite radio service, they stated in their joint filing.

The groups also said the FCC should appoint an independent monitor to oversee compliance with any merger conditions.

blackjack · Post by **blackjack** » July 23, 2008 11:40 pm

The Exxon-Mobil merger didn't take nearly this long and that was for a COMMODITY! This is a luxury.

This is noting more than the NAB paying off the politicos to hold this up.

Pure BS!

Let the merger pass without any BS fine!

rich_big · Post by **rich_big** » July 23, 2008 11:56 pm

as a subscriber, this makes me very happy. as a stockholder, it makes me really really happy. stock went up aprox 12% today. lets hope it keeps going so I can break even.

moog · Post by **moog** » July 24, 2008 2:28 pm

Education program? Why? Either people buy this service or they stick with the wasteland that the NAB is so protective of. Besides, commercial radio puts "public service" material on when no one is listening. Between 4 am and 9 am Sunday.

I agree Blackjack. It's all BS.

Afternoon Golfer · Post by **Afternoon Golfer** » July 24, 2008 2:34 pm

Complete BS. Approve already!

Zuke · Post by **Zuke** » July 25, 2008 9:52 pm

Done deal, the vote was 3-2.

WASHINGTON (AP) - Federal regulators formally approved the
merger of the nation's only two satellite radio operators Friday,
ending a 16-month-long drama closely watched by Washington and Wall
Street.
Sirius Satellite Radio Inc.'s $3.3 billion buyout of rival XM
Satellite Radio Holdings Inc. will mean 18 million-plus subscribers
will be able to receive programming from both services. Executives
say it will mean huge cost savings that will lead to a first-ever
profit for the relatively nascent industry.
The Federal Communications Commission voted 3-2 to approve the
buyout, with the tie-breaking vote coming Friday night from
Republican commissioner Deborah Taylor Tate.
Tate had insisted that the companies settle charges that they
violated FCC rules before she would approve the deal. The companies
agreed this week to pay $19.7 million to the U.S. Treasury for
violations related to radio receivers and ground-based signal
repeaters.
FCC Chairman Kevin Martin confirmed the final 3-2 vote Friday
night.
"I think it's going to be, in the end, a good thing for
consumers and be in the public interest," he told The Associated
Press.
The approval appeared to hit a glitch on Friday when a dispute
surfaced between the chairman and Tate over the enforcement issue,
but differences between the two were quickly resolved, and the
approval went forward.

Post by **SMLCHNG** » July 25, 2008 9:54 pm

Thanks, Zuke.. will be interesting.

Zuke · Post by **Zuke** » July 25, 2008 10:01 pm

I have Sirius, so I won't be adding anything from XM.

Skibo · Post by **Skibo** » July 25, 2008 10:04 pm

This is good. Hopefully the combined company will be able to turn a profit.

a1aara · Post by **a1aara** » July 25, 2008 10:45 pm

Zuke wrote:I have Sirius, so I won't be adding anything from XM.

I think that XM has a better musical varity than SIRIUS. I would love to add XCOUNTRY, the BONEYARD, and the LOFT to my SIRIUS subscription.

docandjeanie · Post by **docandjeanie** » July 25, 2008 11:24 pm

a1aara wrote:
Zuke wrote:I have Sirius, so I won't be adding anything from XM.
I think that XM has a better musical varity than SIRIUS. I would love to add XCOUNTRY, the BONEYARD, and the LOFT to my SIRIUS subscription.

I love xm, but I am really happy to get Sirius, woooooooooo hoooooooo!

The joint 101 is my favorite on xm.

ScarletB · Post by **ScarletB** » July 26, 2008 8:00 am

I just let the free XM trial lapse in my new car - in VT it cuts out all the time anyway (no signal), however now that RM will be available I may have to re-think this! I was becoming a CNBC junkie and that was not a good thing.

johnson2113 · Post by **johnson2113** » July 26, 2008 5:10 pm

Who will win? Radio Margaritaville vs. Kenny Chesney's No Shoes Radio

BottleofRum · Post by **BottleofRum** » July 29, 2008 1:06 pm

Announced today, the name of the merged company will be called:
Sirius XM Radio Inc.

blackjack · Post by **blackjack** » July 29, 2008 1:08 pm

So why is my stock hitting the sh!tter?

Afternoon Golfer · Post by **Afternoon Golfer** » July 29, 2008 4:09 pm

Nice! My wife's Honda Pilot has XM in it which we don't use. She has a subscription to Sirius and the reception stinks. Can't wait until the programming is available on both systems.