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Sirius / XM merger gets antitrust approval in U.S.

24 March 2008 18:37 by James "Dela" Delahunty | 23 comments

The proposed $4.59 billion purchase of XM Satellite Radio by rival Sirius Satellite Radio has been given antitrust clearance by the U.S. Justice Department on Monday. The investigation into the proposed merger that would combine the only two providers of satellite radio in the United States concluded that nowadays things are much different than they were when Sirius and XM were licensed.

These days, consumers have portable audio players and mobile phones that can play digital audio. Other services can now also be considered competition such as HD Radio. "Competition in the marketplace generally protects consumers and I have no reason to believe that this won't happen here," Justice Department antitrust chief, Thomas Barnett, told a conference call with reporters.

Consumer groups and traditional radio bodies criticized the proposed merger as anti-competitive. In 1997, both companies were barred from acquiring the other. A source has told Reuters that while the FCC must determine whether the purchase is in the public-interest, FCC Chairman Kevin Martin has not proposed what should be done just yet, but has request staff to draft documents for different possible outcomes.

The source said that the FCC's decision may be strongly influenced by the findings of the Justice Department, and it may agree that Satellite Radio now has much larger competition from other forms of digital media services to consider.

Permalink to this article

XM / Sirius merger appears close to conclusion (17 June 2008)

Regulators' Satellite Radio decision gets criticism (3 April 2008)

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South Park goes digital, and for free (25 March 2008)

50% of all mobile phones will play music by 2011, says study (24 March 2008)

Sirius hits 8.3 million subscribers in 2007 (4 January 2008)

Sirius/XM merger gets support from three U.S. lawmakers (16 December 2007)

Sirius, XM shareholders to vote on merger (4 October 2007)

FCC seeks public opinion on XM-Sirius merger (9 June 2007)

Sirius CEO talks about XM merger with senators (23 March 2007)

Sirius and XM hit with patent infringement lawsuit (20 March 2007)

XM and Sirius address concerns over merger (5 March 2007)

U.S. Congress to study Sirius & XM merger (22 February 2007)

Sirius and XM to merge (19 February 2007)

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21Q (Senior Member) 24 March 2008 18:58
So will the unused XM hardware in my car be even more useless than before? [ + quote]
Chomp (Newbie) 24 March 2008 19:10
If this isn't a monopoly I don't know what is. Doesn't matter though, I don't use sattellite radio. [ + quote]
KKM (Junior Member) 24 March 2008 19:47
*Originally posted by Chomp:* If this isn't a monopoly I don't know what is. Doesn't matter though, I don't use sattellite radio. You don't know what a monopoly is. [ + quote]
Run4two (Junior Member) 24 March 2008 19:58
I would hope (probably naively) that this would be the best of both worlds. That those who bought XM would be grandfathered into receiving services of both networks. And those who purchased Sirius would also now receive both stations. There would be some work arounds to be sure, but I hope it happens. The present doesn't seem so muddy, the future does. What are the future predicions on this? [ + quote]
sgriesch (Newbie) 24 March 2008 20:03
Yeah, they are just going to try to lose their money together instead of fighting over which one can lose the most. Hardware will still be good for a while. They wouldn't kill the service just because one company bought the other. Just wait until HD Radio begins to catch on. Also, there is Slacker.com who will be launching a Pandora meets Satellite Radio company. You tell it what music you like, and the portable player will let you listen to similar music anywhere. Right now, I have only seen the internet version in action. I'm just waiting for in-car systems to be smart enough to connect to your home server by satellite through the internet to stream music from your personal library. But that's just asking too much now isn't it? [ + quote]
DarkJello (Senior Member) 24 March 2008 21:32
What I think is going to happen is an entire new service will be rolled out, XM and Sirius stations are going to be merged together to form one service. Equipment from both camps will be continually supported as XM already has their satellites in orbit broadcasting. I have no idea if this is the case or not, but both XM and Sirius are probably broadcasted over the same spectrum, and are encrypted so only Sirius or XM players can receive them. This is good for the consumer, and will hopefully allow them to bring prices down. No one has to buy satellite radio, there is already free broadcast radio, not to mention countless other ways to consume music. [ + quote]
DJchemist (Member) 24 March 2008 23:18
i find satalite radio to be complete shit i install it on a daily basis and i deal with it on a daily basis paying for an FM signal (which is shit quality might i add) is to me in no way worth it i can;t wait till HD Radio gets big but that soley dependant of the radio stations out there hurray for 3-band multicasting on Alpine Radio's :) PSP -> 2.60 TA-082 + 2.71 - 1.5 + 3.03 OE-A + OE-B + OE-C + 3.52 M33 - 3.40 OE-A + 3.52 M33-4 + 3.71 M33-4 w/ 1.50-2 add on Hardstyle or No Style baby. w000 -DJ The Chemist [ + quote] This message has been edited since posting. Last time this message was edited on 24 March 2008 23:20
7thsinger (Senior Member) 25 March 2008 8:11
*Originally posted by 21Q:* So will the unused XM hardware in my car be even more useless than before? Lol. I can second that. [ + quote]
spydah (Junior Member) 25 March 2008 11:59
I can't wait for this merger. I love XM in my car. It saves me from listening to the crappy stations in my area when i dont have my Ipod. Once Sirius comes on board I will get more comedy stations and NFL & NBA games while im on the road. This is sweet. [ + quote]
bobiroc (Member) 25 March 2008 17:41
I have Sirius on my Dish Network TV and with the Package I got I can get a free subscription for my car or other portable device. I do not have satellite radio in my current car as it is 10 years old, but I am buying a new car in about a month and it will have XM built in. I just hope that eventually I can apply that free subscription to it. [ + quote]
sgriesch (Newbie) 25 March 2008 20:05
*Originally posted by bobiroc:* I have Sirius on my Dish Network TV and with the Package I got I can get a free subscription for my car or other portable device. I do not have satellite radio in my current car as it is 10 years old, but I am buying a new car in about a month and it will have XM built in. I just hope that eventually I can apply that free subscription to it. The built in version is way better. FM Modulaters are horrible. We have 2 of them right now, and am about to get rid of it because the sound is bad. I bet DJChemist will back that up. [ + quote] This message has been edited since posting. Last time this message was edited on 25 March 2008 20:06
iluvendo (AfterDawn Addict) 25 March 2008 20:34
Now there was only one. If it wasn't for bad luck, I'd have no luck! "The flimsier the product,the higher the price" Ferengi 82nd rule of aquisition [ + quote]
DJchemist (Member) 25 March 2008 22:12
*Quote:* *Originally posted by bobiroc:* I bet DJChemist will back that up. oh hell yes if you can get ahold of ANYTHING built in its now in an analog form, not FM (or in some instances Digital) like i said.. Alpine USA/Canada has made a huge sponser with sirius for units that are directly added to a deck then i might say its worth it ..might.. i still prefer my Mp3 Cd's... still can't get anything more then 128kb/s off of a satradio. 320 off a CD :) when running a high quality system disortion needs to be minimal anyways thats my rant EDIT: simple grammer [ + quote] This message has been edited since posting. Last time this message was edited on 25 March 2008 22:13
RNR1995 (Inactive) 30 March 2008 15:33
How can anyone think that this is good for consumers? Comcast anyone? What happens when a corporation has no competition, high prices and poor service..... [ + quote]
DarkJello (Senior Member) 30 March 2008 16:05
The article clearly states the competition satellite radio has. I don't understand how people really don't like this. If they raise the prices to high people just won't use the god damn service! It isn't that complicated. People still have the choice to use their CD's MP3's not to mention regular broadcast AM/FM radio, which has now gone digital with HD broadcasting. I personally feel like people who *don't* have satellite radio don't want this to happen, and people who do do want it to happen. What I don't get is why the people who don't have the service, don't want it to happen. It doesn't even effect you! Comcast is a completely irrelevant example. They are in most cases the only service provider of high speed internet in many areas. They have a true monopoly because no other form of high speed internet is available. They are the only providers of that service. There are dozens of different ways to access news, music, traffic and weather. [ + quote] This message has been edited since posting. Last time this message was edited on 30 March 2008 16:08
RNR1995 (Inactive) 30 March 2008 16:25
you mean none right? "The investigation into the proposed merger that would combine the only two providers of satellite radio in the United States" Competition in the same venue. HD radio is not competition, it's free It would be like broadcast TV is competition for Comcast [ + quote]
DarkJello (Senior Member) 30 March 2008 16:31
Traditional radio and satellite radio are in the same 'venue' They both serve the same purpose to the consumer, which is to provide them with music and news through the air. AM/FM radio is not free, it's ad supported. And with the advent of HD Radio and the ability to 'simulcast' multiple programs in the same frequency band the choices offered by HD Radio will come close to rivaling those of satellite. Sirius and XM aren't retarded, no one is going to subscribe to their service if they make the price to high. They want to make money just like every other company and the best way to do it is to price it competitively. [ + quote]
sgriesch (Newbie) 30 March 2008 17:48
*Originally posted by DarkJello:* Traditional radio and satellite radio are in the same 'venue' They both serve the same purpose to the consumer, which is to provide them with music and news through the air. AM/FM radio is not free, it's ad supported. And with the advent of HD Radio and the ability to 'simulcast' multiple programs in the same frequency band the choices offered by HD Radio will come close to rivaling those of satellite. Sirius and XM aren't retarded, no one is going to subscribe to their service if they make the price to high. They want to make money just like every other company and the best way to do it is to price it competitively. Dark Jello's right. Am/Fm, Satellite, and HD radio all compete with each other. 3 are add supported. Satellite radio is slightly add supported, but mainly subscription based. They all compete for the same listeners. If you don't want a subscription use AM/FM or HD. If you want to listen to the same stations driving across the country use satellite. They all have different features which make them unique. The satellite radio companies wanted to stay alive, so they are combining operating costs by merging. It's not about becoming a monopoly. It's really about staying in business. If they want their business to die, they'll charge more for their service. It's the only one that you HAVE to pay for. The others are free. [ + quote]
wetsparks (Member) 30 March 2008 19:03
It is good to see this is going through. As it was, one of them would be going out of business anyways, I presume XM since they are the ones getting bought up, because they were losing money. This way people that are subscribing can keep getting satellite radio and hopefully it will keep Sirius in business. [ + quote]
varnull (Senior Member) 30 March 2008 19:12
As long as it isn't a hostile takeover (like M$ are trying on yahoo) then I can't see what the problem is. An agreed merger isn't like a giant buying up all the smaller competition is it. As long as they support both lots of hardware (don't know much about satellite radio TBH) for the presumed lifetime of it then it's probably better for the owners/users of the smaller service. Free open source software = made by end users who want an application to work.... [ + quote]
DarkJello (Senior Member) 30 March 2008 20:49
Combining each services exclusives is a huge bonus for the consumer, like the sports leagues. I hope it goes through [ + quote]
rockjckey (Newbie) 31 March 2008 3:10
Comparing HD (hybrid digital) radio to satellite is like comparing apples to oranges. If you have satellite radio you know all the advantages such as all NFL and Baseball games. Comedy channels, old time radio channels, talk radio channels, Playboy radio, NASCAR racing car to pit conversations along with all the commercial free music. I now hate listening to music on regular radio with all the f-----g commercials. with HD radio you will get all the FCC will allow you to have along with the commercials. Need I say more. You can get more on the internet but good luck tuning in when you are mobile and don't count on nationwide WI-FI for decades. [ + quote]
RNR1995 (Inactive) 31 March 2008 18:40
I guess only time will tell whether they dry up, or become a Comcast like company. usually mergers just mean buying your competition so you can control more of the market and more of the pricing [ + quote]