FCC Chairman Recommends Sirius-XM Approval

June 16, 2008 — -- The merger of the satellite radio providers XM and Sirius crept closer to becoming a reality over the weekend when Federal Communications Commission Chairman Kevin Martin announced that he would back the deal.

Martin made the recommendation after the companies agreed to concessions such as earmarking 24 channels for noncommercial and minority programming.

"As I've indicated before, this is an unusual situation," Martin said in a statement released to The Associated Press. "I am recommending that with the voluntary commitments [the companies] have offered, on balance, this transaction would be in the public interest."

While XM and Sirius have argued that the merger will give consumers more choice, consumer groups have said the math just doesn't add up.

The Justice Department announced in March that it would allow the proposed merger to proceed, ruling that it is not likely to lessen competition or to harm consumers. The department argued that the companies aren't really competing and that there are alternative services such as the use of MP3 players in cars.

Consumer groups were outraged, citing a likely increase in prices down the line and a lack of choice for consumers. XM, with more than 9 million subscribers, and Sirius, with about 8.3 million, see it differently. They argue that the merger will give consumers the best of both worlds -- Howard Stern and Oprah, football and baseball.

"XM customers would continue to receive their existing XM service and be able to obtain certain Sirius programming," the companies said in a joint statement in March. "Sirius customers would continue to receive their existing Sirius service, and be able to obtain certain XM programming."

The company announced last year that it will offer eight different packages to customers; two of them are a la carte packages.

"These will be the first-ever a la carte options in subscription media," the companies' statement said. "A la carte programming will only be available for subscribers using new radios, which are in development and will be brought to market following approval of the merger."