usrbingeek told you about the attempted merger between Sirius and XM. What he didn’t tell you is that there is a FCC provision that specifically prohibits the two satellite radio companies from merging. It would create a monopoly the likes of which we haven’t seen since the early 20th century.
For those of you that think it will lower costs it probably will, initially, but the prices will surely be tweaked once the new mega company realizes that they are a monopoly and have no competition. The Sirius/XM merger, as offered today, will surely be struck down if not by the Federal Communications Commission then certainly by the Securities and Exchange Commission.
I agree that neither company can survive on their own but what they should each be looking for is to be bought out by a corporate giant (a Google, Microsoft, or Sony for example) so that their dreams will not be a failure.
Regarding the FCC provision I found this on CNet:
What regulatory hurdles does the deal face?
The U.S. Department of Justice and the Federal Communications Commission must grant approval, posing a significant challenge. Because Sirius and XM are the only two satellite radio providers operating in the country, their merger would effectively create a monopoly. Federal legislation bars both satellite radio licenses from being owned by the same company to guard against high prices and other negative effects on consumers. FCC Chairman Kevin Martin said in a statement that the hurdle for approval would be high. “The companies would need to demonstrate that consumers would clearly be better off with both more choice and affordable prices,” Martin said. Given historic opposition to media consolidation by Democrats, who control Congress, the companies will have some hard lobbying to do.
Back in January FCC Chairman Kevin Martin also said that, “two satellite radio operators [must] remain in place,” according to MediaWeek. That should make it very difficult to make the merger happen.
[tags]sirius, xm, merger, satellite, radio, FCC, SEC, monopoly[/tags]