Eyes on FCC After DOJ Approves XM/Sirius Deal

Reactions were mixed after the Antitrust Division at the Justice Department closed its inquiry into the merger between XM and Sirius, a move that effectively gives the companies the department's OK to combine operations.

For their part, the companies issued a terse, one paragraph statement saying that the Justice Department "has concluded that the merger is not anti-competitive and it will allow the transaction to proceed." They mentioned that the Federal Communications Commission still needs to approve the deal, and that was where a lot of attention was focused after the DOJ decision was handed down late Monday.

Sen. Herb Kohl, chair of the Senate Judiciary Committee's antitrust subcommittee, urged the FCC to "find the merger contrary to the public interest and exercise its authority to block it." He also said the "elimination of competition between XM and Sirius is contrary to antitrust law and the interests of consumers."

Ed Markey, chair of the House Telecommunications Subcommittee, said, "If the Federal Communications Commission, after completing its analysis and consideration of the proposed merger, decides to approve it, I urge the FCC to appropriately condition any such approval to ensure consumer welfare with respect to long-term service plans and pricing as well as equipment compatibility and pricing.

"In addition, the commission should take action to ensure that the public interest values of diversity and localism are fulfilled with respect to satellite radio service in a manner consistent with congressional precedent, as Congress and the FCC did with respect to satellite television services."

Some industry observers said it's unlikely the FCC would issue a decision on the merger that contradicts the Justice Department conclusion. Most said the commission could require conditions for the pending combination of satellite radio companies, including a la carte programming choices for consumers, something the companies have said they would accept.

Gigi Sohn, president of advocacy group Public Knowledge, said the satellite radio transaction should be approved with conditions. Along with a la carte, Public Knowledge, which has been active at the FCC concerning the merger, said a combined satellite radio company should make 5 percent of its channel capacity available to non-commercial educational programmers and promise not to jump pricing for three years, among other proposals.