Eyes Are on Commission for White Smoke on XM-Sirius Deal
by Leslie Stimson, 07.24.2008
All eyes are on Commissioner Deborah Tate as word is the FCC is close to approving the merger between Sirius and XM.
Tate is said to be the swing vote to break a 2–2 deadlock split along party lines. Tate, a Republican, normally votes in agreement with Chairman Kevin Martin. Both Martin and GOP’er Robert McDowell have already voted for the deal, with conditions.
Sources told The Washington Post that final conditions are being hammered out, including a $20 million total penalty on the satcasters for not fulfilling their 1997 licensing obligation to offer interoperable radios to subscribers. Tate had also reportedly spelled out other conditions such as price caps and more minority programming, conditions Martin has said the companies have agreed to.
Democrat Michael Copps opposed the deal on monopolistic grounds, which was not a surprise. What was a surprise was Jonathan Adelstein changing his vote yesterday from a “yes with conditions” to a “no,” once it became clear the companies would not agree to conditions he’d floated such as a six-year price freeze. He had also called for mandated HD Radio in future sat tuners, but it’s not clear where that specific condition stands. Now, he said, it appears the companies are “going to get a monopoly with window dressing.”
NAB, reacting to the Wall Street Journal’s report yesterday stating deal approval was imminent, called it a “sweetheart deal.” The trade group’s statement seemed to leave open the possibility that NAB might appeal any decision or take it to court.
What intrigue. I don’t think I’ve seen a deal affecting media outlets at the commission where news of the votes were dribbled out so openly. And a $20 million fine, while large, feels like a “cost of doing business” for the satcasters, rather than a real stick to get them to follow the FCC’s licensing rules.