Did FCC Commissioner Drop Hints On Sirius/XM Merger?

FCC Commissioner Jonathan Adelstein was interviewed on NPR Wednesday, and in that interview a caller asked the Commissioner a question about the proposed merger between Sirius (SIRI) and XM (XMSR). In his answers, Adelstein indicated that a DOJ decision may be coming soon, and that an FCC decision may come in the first quarter of next year.

One has to ask this question though… if the DOJ were to rule against the merger, why would the FCC need to make a decision? Did Johnny let the cat out of the DOJ bag on a positive merger decision? How will investors react to an FCC decision delayed until Q1 if the DOJ approves soon as indicated by Adelstein?

Listeners can hear the entire interview on the NPR website (SDARS section is from minute 12-13:30).

Comments

[VT Professor:]

It's gonna go through..........Shoul... but will. For the life of me, I don't see how this is "good" for consumers. It only further limits competition IMO. Probably a big contributor to the current administration somewhere in the woodpile.

2007 Dec 20 09:40 AM

[PotentialSa...:]

What would be "good" for the consumer would be to get this done by Christmas. Plenty of people are waiting ( like me ) to buy products once the two merge. Right now it's like having to order both comcast and time warner to get all your cable channels. I love the idea of Satellite radio but I'm not going to pay two people to get two products to cover all the channels I want.

2007 Dec 20 10:11 AM

[Hippocritic...:]

The suggestion that a DOJ ruling against the merger somehow precludes the FCC making a ruling or eliminates the need for the FCC to make a ruling is, well, just dumb.

FCC isn't going to "not rule" on the merger if DOJ decides to sue to stop it.

Not saying the merger isn't going to pass, just that the idea expressed in this article is beyond stupid.

2007 Dec 20 10:52 AM

[oceandude:]

It will go through because both companies will be non-existent in 5-10 years if it does not.

2007 Dec 20 11:46 AM

[TCJR:]

If you can't understand why this is good for consumers, you need to take off the blinders. The competition is diverse and this is a PAY service. If the merged company succeeds there is no prohibition on a new player entering the market and competing.

2007 Dec 20 12:06 PM

[lazywaste:]

VT Professor you are an idiot if you think that it will hurt the consumer. If you don't like the service then don't pay for it. Considering that Satelitte Radio garners less than 5% of the listening radio audience, there is no way that you can call it a monopoly. The simple fact is that by merging they can become competitive with traditional radio, Apple Ipods and WiFi - which represent the other 95% of the listening radio audience. sorry that your just to ignorant or stupid to realise that.

2007 Dec 20 12:48 PM

[Roxieanne:]

As noted by 'Potential Sat Fan'

"Plenty of people are waiting ( like me ) to buy products once the two merge. Right now it's like having to order both comcast and time warner to get all your cable channels."

Totally agree. There is no incentive to buy until the merger is approved or disapproved.

2007 Dec 20 02:26 PM

[firboy4:]

I'm for the merger, though it will create a monopoly. But it's a monopoly that has a lot of competition! It's like having a monopoly in tea. If it gets too high, people will just get their caffiene from coffee, or vice versa. So, in a sense, nothing is really a monopoly, if there is any other possible way to satisfy wants and needs.
But I'm for the merger simply because I've been holding plenty of damned SIRI for way too long! It's a matter of just wanting to make some money. However, once it ever goes through, I might want to subscribe, since I can't get any good radio stations, but plenty of "country" ones. But I certainly agree that I will wait until the merger so that I can buy exactly the right equipment for my car. I have no need for satellite radio in my home.

2007 Dec 20 03:19 PM

[davefromber...:]

Savery is trying to fuel speculation where none exists. I listened to the FCC commissioner being interviewed and heard nothing but a tepid reiteration of known news. Coming from a source I often find insightful (Savery, that is), this sinks to the level of desperately "wishing it were so."

2007 Dec 20 04:19 PM

[dandy:]

There are so very many high ups that already have stated that they are for the Merger, This seems like a no brainer. Buy more SIRI

2007 Dec 21 01:34 PM

[CAFFPM:]

First off, monopolies are not illegal in the United States. Taser for example has a vurtual lock on the entire stun gun market, Boeing is really the only large commerical aircraft company in the U.S. pharma, in the intrest of market development are allowed 17 years of copyrights on new drugs...the list goes on.

While allowing the merger would clearly create a monopoly in SATELLITE BASED broadcasting, it doesn't materialy limit the choices of the end user. Consolidation of two breweries in Colorado for example doesn't remarkably limit my selection of beer, wine or whiskey at a bar in L.A.

Even if we consider the merged company anticompetive, allowing the merger is the sole opportunity for the DOJ or the FCC to regulate a single provider, that is to say that if the merger ISN"T approved, ONE of the companies will go out of bussiness leaving an unregulated monopoly of the satellite based broadcasters. Therefore it's in the intrest of both DOJ and FCC to approve it with conditions.

What's funny about this article is that it draws the correct conclusion from the wrong piece of data. The comissioner said nothing subatantial in his refrence about the FCC deciding after DOJ, the tell was in his discussion of the issues under consideation by Justice "...They must determine what the relavent market is..." I see no way an educated, impartial body who understands the nature of the radio markets and the financial dire straits of the competitors can reach any other conclusion than to approve it. The game lies within deciding if Justice and the FCC are both educated and impartial... I'm long Sirius

2007 Dec 23 06:30 PM

[NPR listener:]

I heard the interview live, and the FCC commissioner was only repeating what we've all been hearing for a couple weeks now. I am a SIRI stockholder, not a subscriber, and can't believe there is one current subscriber of either company that wouldn't welcome the merger.

2007 Dec 23 06:33 PM

[NPR listener:]

and furthermore . . . as for competition, I AM a cable subscriber that also buys DirecTV' NFL Sunday Ticket a la cart, and if the merger goes thru I would seriously (no pun intended) consider swapping the $250 that Sunday Ticket costs for an entire year's subscription to Sirius with all the NFL games, NASCAR, and all the other choices available AND save money.

2007 Dec 23 06:40 PM

[HB:]

To call this a monopoly one would have to define a single market, Satellite Radio. If you subscribe to this thought you would also have to say that there is no competition outside of that.
A new market must be defined as Audio Entertainment. A simple look into a Ford vehicle proves that satellite radio competes with CD, HD,
i-POD, Bluetooth connected cell phone and AM/FM. That alone represents six venues to listen to music, this is just inside of a car or truck not to mention internet and wi-fi radio at home.
A monopoly within a Satellite Radio sector by these two companies has even been said not possible by government officials during the initial hearings citing that Sirius and XM have already established dominance in the few years they have been in operation. This would provide the entrance of a new startup company to not be financially viable.
Reed Hundt who was the FCC architect of the original Satellite Radio licensing admitted that the rule for not allowing the two companies to merge was to promote competition within the field and that the companies were fully intended to compete with terrestrial radio. He has since stated that in light of the new entries into audio entertainment since the inception of satellite Radio, the two companies should be allowed to merge.
Mr.Hundt is correct.
As for consumer benefits, a $6.99 entry into the world of satellite radio makes it more affordable to those that wish to have it. The synergies allowed by the merger make the pricing possible where as a stand alone company could not offer this. A-La-Carte’ offerings will also allow parental control.

Mr.Hundt is correct. Let the merger happen.

2007 Dec 24 07:47 PM

[nquiry4-xmc...:]

I must reply to at least one of the preceeding comments as it is apparent to me that this person is clearly uninformed, or more specifically is lacking in personal experience.

Comments regarding a monopoly and the effect on the consumer seem to be opinion based on a strong desire to become a paying subscriber of the NEW and IMPROVED XMSR post merger. That is understandable given the picture that is being presented as far as programming, price, and equipment reliability/longevity.

However, consider that the picture is being painted with wide, as well as colorful strokes with self interest as the primary motivation. Promises for more programming at a better price, promises regarding support for 'OLD' technology, and even consideration for some sort of rebate or refund with purchase of newer receiver. Positive, yes, but only PROMISES.

To really evaluate whether or not, as a particular 'future subscriber' put it, "....would have to be an idiot, to thinik that the consumer would be hurt......."

Check on the history of this company and decide for yourself who is or isn't an idiot....

1. Check with BBB, unsatisfactory rating, since the beginning, through out, and to date......
2. Research support for equipment that doesn't work. Installer? Seller? Provider of Subscription??
3. Check lawsuits and probes (FCC) regarding "marketing practices." (If you find 'closed without action", you may want to check contibutions to lobbiests as well as who/how will benefit from new programming/dedicated content.)
4. If you have a new automobile with factory installed satellite radio, check verbage of the warranty regarding 'after market' changes to electonic equipment!!
5. MOST OF ALL....If a person, (Idiot, as it was referred), didn't like the programming, service, commercails, or perceived lack of choice, you forgot one thing;
YOU HAVE TO PROVIDE CREDIT CARD or better yet
PAY IN ADVANCE!!!!!!!!!!!!
*** Now do a little web surfing for yourself and take note; how many people paid in advance and TRIED TO OBTAIN A REFUND or even have their complaint appropriately addressed!! Good luck. If one of the unfortunate many, you will be starting by calling an 800 number in another country. (Might as well be another planet)

Note that online, XM states that the trial subscription is without obligation and refunds may be obtained for unused service.

XMSR customer service will tell you, "WE DO NOT PRO RATE, WE DO NOT GIVE REFUNDS.


Since future behavior can be based on past performance, then take heed as to promises made, both past and present.

If you had paid for this service in advance and had personal experience with this company remotely resembling my own, you too may relate to the comment ...'have to be an idiot..." to some degree. ( pay GM nearly $400.00 for the receiver then advance pay two years subscription)....

.....YOU WOULD HAVE TO BE AN IDIOT IF..............


Signed 'I agree in part,'
An XMSR prepaying IDIOT

2007 Dec 29 07:36 AM