XM Radio/ Sirius Merge – Would the FCC bend the rules again?
On Jan 10th 2008, at the Citigroup Investor conference in Las Vegas, the Federal Communication Commission (FCC) Chairman Mr. Kevin Smith hinted that the merger between the two radio satellite giants XM and Sirius would be blocked.
The CEO of Sirius, Mr. Mel Karmazin earlier stated that this merger would be of the best interests for the both the company and the public. However, the FCC is not in agreement. Inside Radio quoted Mr. Smith commenting that it would result in a monopoly and relates this merger to the earlier satellite television merge between Echostar and Direc TV which was blocked by the FCC because it violated the Satellite DARS Anti-Merger Rule which prohibits monopolies in spectrum assigned to particular services.
The music industry is concerned about this merger as well since this monopoly would prove to be serious competition. The Recording Institution of America (RIAA) has filed comments with the FCC to overlook copyright infringements if this merge happens. Due to the fact that people would have access to a wide range of music on multiple platforms including the internet this would make it easier to rip music and videos. This is one of the biggest threats to the music industry since piracy levels would increase as never before. The National Association of Broadcasters (NAB) is completely against this merger because it not only violates the DARS rule but, would also put minority-owned providers at a disadvantage. All parties are eagerly awaiting the final ruling by the FCC.
SOURCES
1. FCC Chairman Hints That XM + Sirius Merger Would Be Blocked. (2007, January 12). Retrieved February 2, 2008, from Orbitcast Web site: http://www.orbitcast.com/archives/fcc-chairman-hints-that-xm-sirius-merger-would-be-blocked.html
2. RIAA Tells FCC It Takes XM-Sirius Merger, Well, Seriously. (2007, July 9). TMCnet. Retrieved February 2, 2008, from http://blog.tmcnet.com/regulations/fcc/
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