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Home > BizTimes Daily > Archives > April 11, 2008
Van Hollen urges FCC to block satellite radio station merger
Published April 11, 2008 - BizTimes Daily
Citing concerns about "anti-competitive" and "anti-consumer effects," Wisconsin Attorney General J.B. Van Hollen has asked the Federal Communications Commission (FCC) to utilize its role to carefully review a proposed merger of the nation's only two satellite radio companies.
The U.S. Department of Justice decided earlier this month to permit Sirius Satellite Radio Inc. to acquire rival XM Satellite Radio Holdings Inc. for $5 billion. The FCC still has to sign off on the deal.
In a letter to FCC chairman Kevin Martin, Van Hollen asked the commission to take into account the broad public interest of the proposed license transfer between XM and Sirius.
"In terms of coverage, broadcast radio does not have the reach of satellite radio. Milwaukee, Wisconsin's largest city, receives only 41 local radio signals. Although this is a significant amount, it pales in comparison to XM or Sirius, each of which has over 100 channels a piece," Van Hollen wrote to Martin. "About 1.2 million Wisconsinites live in areas that receive fewer than 15 broadcast radio channels. Rural areas in Wisconsin are the most severely affected, some receiving less than five radio stations. For people living in and driving through these areas, this license transfer would represent a significant reduction in the number of channels available to meet their needs and will adversely impact the public interest."
Van Hollen, a Republican, said he issued the letter to the FCC after the Antitrust Division of the U.S. Department of Justice announced that it would not attempt to block the merger, "despite he fact that the merger would eliminate all competition in the satellite radio industry."
"The FCC's standard for reviewing a license transfer is broader than the United States Department of Justice's merger review, and I think that this transfer should raise several red flags for the FCC," Van Hollen said. "The Sirius-XM deal is anti-competitive and anti-consumer."
