Can XM-Sirius merger stand up to Washington politics?

[Kire]

Can XM-Sirius merger stand up to Washington politics?

July 18th, 2008 - ZDNet

After well over a year of scrutiny, the proposed merger between the country’s two satellite radio providers - XM and Sirius - is finally on the home stretch, set for an approval vote as early as Aug. 1. But wait. This week, one of the FCC commissioners proposed even more conditions - beyond what chairman Kevin Martin has already suggested and what XM/Sirius execs have offered. With Washington politics at play, could the last mile to a vote be delayed even further?

From the beginning, XM and Sirius faced an uphill battle to get this merger approved, notably the matter of a no-merging-in-the-future clause that was established when the two companies received their licenses. But through it all, Sirius CEO Mel Karmazin - the primary spokesman for all things related to the merger - has kept fighting, offering concessions that would merge the channel lineups, protect consumers from price hikes, keep the old radios from becoming useless bricks, set aside a fixed number of channels for non-commercial and minority programming and even establish an a la carte pricing structure.

Finally, FCC chairman Martin - who appeared to be the one who might need the hardest sell on the merger - said last month that he would recommend approval under certain conditions, many of which Karmazin had already OK’d. But it turns out that Commissioner Jonathan Adelstein, one of the two Democrats on the five-member commission, could be the one to hold things up even further. He says he’ll approve the merger if the cap on subscription prices is increased from three years to six; the merged company sets aside 25 percent of the channel lineup (instead of the set 24 channels) for non-commercial and minority programming and that new satellite radio receivers be built with technology that allows them to receive the new HD Radio signals.

Ah-ha. Now, this is all starting to make sense. HD Radio, high-quality niche programming that plays only on special receivers, is the newest offering from the terrestrial radio stations to get listeners back. You see, with all the alternatives to radio out there, listeners have choices - iPods, CDs, streaming radio over the Internet and, of course, satellite radio. And yet, when the satellite radio guys used the same argument to show how a merger of the two wouldn’t create a monopoly, the National Association of Broadcasters, a powerful Washington lobbying group that represents the radio stations, cried foul. (This is the famous you-compete-with-us-but-we-don’t-compete-with-you argument that the NAB was spewing last year.)

Since HD Radio hasn’t really taken off in the mainstream market, maybe forcing the satellite companies to push that technology on to its subscribers is one way to make listeners discover it. (I wonder if Adelstein thought of this himself or if the folks at the NAB whispered it in his ear.)

More: http://blogs.zdnet.com/BTL/?p=9380

This is such a fiasco.

Is it just about as bad as any Wal-Mart coming in and destroying Main Street USA? I don't know, what do you think. the thought came to my mind for some reason.



More ridiculousness here:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x3397403

and here:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x3358450