As expected, the Justice Department approved the merger of XM Satellite Radio and Sirius Satellite Radio.
The key element in the antitrust analysis was that DoJ did not define satellite radio as a market unto itself, but looked at it in a larger context. The Department said that a combined satellite radio company would not be able to raise prices for consumers.
In fact, the analysis was somewhat dismal in its analysis, saying that competition between the two services was slowing dramatically.
At PK, we maintained that if the merger passed antitrust scrutiny at the Justice Department, which it has, then it would be up to the Federal Communications Commission to impose conditions to protect the public interest.
The conditions Public Knowledge has suggested are:
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The new company should make available pricing choices such as a la carte or tiered programming;
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The new company should make 5% of its channel capacity available to noncommercial educational and informational programming over which it has no editorial control;
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The new company should agree not to raise prices for its combined programming package (as opposed to each individual company's current programming package) for three years after the merger is approved; and
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The new company should make the technical specifications of its devices and network open and available to allow device manufacturers to develop, and consumers to use, any device they choose without interference. Pursuant to Commission rules, these devices must be certified by the FCC for receiving signals on the frequencies licensed to the merged entity and be subject to a minimum “do-no-harm” requirement.
We have also asked the Commission to refrain from conditioning the merger on: 1) a prohibition on satellite radio providers providing local programming and 2) any content protection mandate such as the audio broadcast flag. We hope the Commission will act on these requests also.