Senate Antitrust Subcommittee Chair Says Nix XM/Sirius
By John Eggerton -- Broadcasting & Cable, 5/23/2007 11:45:00 AM
The Chairman of the Senate Subcommittee on Antitrust, Competition Policy and Consumer Rights came out strongly against the merger of XM and Sirius Satellite Radio Wednesday.
In a letter to the heads of the FCC and the Justice Department's Antitrust Division, Herb Kohl (D-WI) didn't mince words.
Saying he had concluded satellite radio was a separate market and the merger would concentrate that market with no "viable competitive alternative" he urged the organizations to take "all necessary actions to deny approval of this merger and prevent the creation of this satellite radio monopoly."
Kohl's letter to FCC Chairman Kevin Martin and Assistant Attorney General Thomas Barnett came as the product of a March hearing on the merger in Kohl's subcommittee in which Kohl had indicated the committee had problems with the proposed merger.
That strong opposition was music to the National Association of Broadcasters collective ears: "NAB is delighted that Senate Antitrust Subcommittee Chairman Kohl has recommended a rejection of this proposed monopoly merger. XM and Sirius are fierce competitors in the finite market of satellite radio."
Sirius and XM have countered saying they are trying to become a more competitive and financially secure service in the audio delivery space. They argue the space includes terrestrial radio, cable and Internet radio, iPods and other mobile devices--all points Sirius chief Mel Karmazin made in Kohl's hearing.
Kohl disagrees and says the merger would create a monopoly. "I have concluded this merger, if permitted to proceed, would cause substantial harm to competition and consumers, would be contrary to antitrust law and not in the public interest, and therefore should be blocked by your agencies."
FCC Chairman Kevin Martin has already said the merger faced an uphill climb: ""Obviously the Commission will evaluate any transaction filed to make a determination whether or not approval would be in the public interest," he said when the deal was announced. "The hurdle here, however, would be high as the Commission originally prohibited one company from holding the only two satellite radio licenses."
-
Satellite radios do not just deliver music, they also deliver unique, live programming. This is just one inportant thing makes them distinct from mp3 players and the like. And as such satellite broadcasters also have more freedom to program controversial content than terrestrial programmers (content, by the way, that customers are willing to pay to recieve.) The selection of this content in particular would be severly cut back if the merger were to go through.
Remember, more competition is always a driving factor in improving service and keeping rates low, no matter what the industry. This situation is no different. This merger must not be allowed to happen. XM and Sirius have distinct offerings and the public would be much better served by having them remain seperate. If market forces cause one to go by the wayside, so be it, but at least it will be from healthy competition, not a misguided attempt at increasing shareholder value at the expense of consumers.
Dean Notarnicola - 5/30/2007 10:05:00 PM EDT -
How anyone could honestly and objectively look at XM and Sirius and conclude they the merger of the two companies would constitute a monopoly is beyond incomprehensible. With the competition from traditional radio, internet radio, iPods, etc., there is just no way to legitimately classify a combined company as a monopoly. They deliver audio content. The fact that they would be the only company to deliver it via satellite does not change the fact that competition among providers of audio content remains extremely fierce. If nothing else, all one has to do is consider the elation expressed in the quote from the National Association of Broadcasters. As true competitors to both XM and Sirius, they couldn't be happier that the company will not be allowed to merge, thereby creating a more viable, sustainable business that presents consumers with a much desired alternative to what is currently available over traditional airwaves today. The fact that the NAB is most likely going to be successful in blocking the merger is abominable.
Toby - 5/24/2007 5:26:00 PM EDT
No related content found.
-
No Top Articles
Featured Company
-
Digital Rapids
Digital Rapids is the leading provider of professional hardware and software tools, technology and expertise for bringing video to wider audiences and new viewing platforms. Continuing to set new standards in quality, productivity and versatility, our solutions span the critical ..more
VIEW ALL GALLERIES
