States’ Attorney Generals Write Martin Over XM-Sirius

11 States Express Concern About Department of Justice’s Decision Not to Impose Conditions on Satellite-Radio Merger

By John Eggerton -- Broadcasting & Cable, 3/27/2008 6:06:00 PM

Attorneys general from 11 states wrote Federal Communications Commission chairman Kevin Martin to express their concerns about the Justice Department's decision earlier this week not to challenge or condition the proposed merger of XM Satellite Radio and Sirius Satellite Radio.

"The combination of these companies will result in a single corporation controlling access to all nationally available satellite radio," wrote Ohio Attorney General Marc Dan and 10 others to Martin Thursday. "Given the national footprint, we are disappointed that the Department of Justice Antitrust Division would permit this merger to proceed unchallenged or without the imposition of appropriate terms and conditions that would reduce the proposed transaction’s anticompetitive impact."

Among the conditions Dann and company recommend were interoperable radios, a la carte pricing and the divestiture of sufficient spectrum to create a competitor.

XM and Sirius currently hold the only two national satellite-radio licenses. They argued that their merger will create a better service for subscribers to both services. The companies have said that they would offer a la carte services, not raise prices and create more diverse programming.

Martin has said that he wanted to complete the FCC's review of the merger by the end of the month, which would be Monday (March 31). Justice Department approval -- technically the absence of an antitrust challenge -- came earlier this week. The FCC has a broader oversight role involving public-interest concerns related to holders of spectrum licenses.