FCC Chair Nixes Sirius-XM Merger Concept

NEW YORK Federal Communications Commission chairman Kevin Martin signaled that the FCC would not support a Sirius-XM merger, making it clear that regulations created when the service was conceived more than a decade ago clearly state that “two satellite radio operators [must] remain in place.”

Dreams of such a union were in large part created by the vivid and overworked imaginations of a slew of Wall Street analysts, who have been bouncing merger theories off each other, both firm-to-firm and in weekly, sometimes daily, notes to investors, for months, without much regard for regulatory Washington.

While no merger plan has been filed with the commission, Martin said the FCC would “look at anything that comes before us.” But he noted that there is “a prohibition on one entity owning both of those licenses” and he reminded reporters of how the commission rejected the proposed merger between two satellite television companies in 2004. (In fact, a pro-consolidation oriented panel of commissioners rejected that proposal in less than 60 days, a speedy decision by Washington standards.)

On the topic of payola, Martin echoed others in calling for a “clear and transparent method of radio promotion” and said “the commissioners are trying to decide what is the most appropriate thing for us to do” in reaching a consent decree with radio operators that have been the subject of the payola investigation carried out by the State of New York’s Attorney General’s office.

The FCC’s review of media ownership is progressing, albeit slowly. Martin said he hopes the commission would hold its next public hearing on media ownership sometime in February or March, depending on the commissioners’ schedules, but no geographical location has been decided upon. He noted that there are four more meetings around the country proposed but no schedule has been drafted.