FCC Commissioner Casts Aspersions on Media Mergers

FCC member Michael Copps said Thursday he isn't convinced the proposed merger of satellite-radio companies Sirius Satellite Radio and rival XM Satellite Radio should be allowed to go through. Copps, one of five voting commission members, said it would be a "steep climb" for him to cast a favorable vote on the deal due to his concerns about U.S. media consolidation, and said he felt the same about Sam Zell's pending privitization of Tribune Co. Speaking of the XM/Sirius tie-up, he said: "The parts of the record that I've looked at so far have not shown me that it serves the public interest... Someone's going to have make a pretty powerful and potent demonstration" that the deal is in the public's best interest. Sirius wants to acquire XM for about $4 billion in stock, thereby linking the only two satellite radio providers in the U.S. The companies argue satellite radio faces competition from traditional AM/FM radio and personal audio players. Copps also said he thought the pending takeover of Dow Jones by News Corp. should be closely examined by the FCC, due to its impact on diversity in local and national media, but noted that FCC chairman Kevin Martin didn't seem to share his views in this regard. "His comments are fairly significant because the commissioners have been quite cautious in their comments about the pending transactions," said Stanford Group analyst Paul Gallant. XM shares fell 2.6% Thursday, Sirius shares were flat, Tribune dropped 0.9%, while Dow Jones and News were essentially unchanged.

Sources: Wall Street Journal, Reuters
Commentary: Notable FCC Comment Stage Filings On the Sirius-XM Merger • 8 Important Points On The Sirius/XM Merger • Rumors of Google Buying Sirius
Stocks/ETFs to watch: XMSR, SIRI, TRB, NWS, DJ

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Comments

[User 111321:]

There remains a great deal of healthy skepticism about this deal. If you take a look at the original press release:

media-mergers.com/merg...

it seems to contain a great deal of marketing spin. However, the framework for U.S. anti-trust law was developed more than 80 years ago. In the context of satellite radio, defining the market for entertainment, and the degree of competitiveness, is no easy task.

Steven Ramirez
Beyond the Arc M&A Consulting
www.beyondthearc.com

2007 Oct 05 11:47 PM