James Delahunty
23 May 2007 18:47
Democratic Sen. Herb Kohl of Wisconsin, the chairman of the U.S. Senate's antitrust subcommittee, urged regulators on Wednesday to block a proposed merger of Sirius Satellite Radio and XM Satellite Radio. Kohl sent letters to the Justice Department and the Federal Communications Commission (FCC) urging them to oppose the deal as it would cause "substantial harm to competition and consumers."
"Such a result should be unacceptable under antitrust law and as a matter of communication policy," Kohl wrote to FCC Chairman Kevin Martin and the Justice Department's antitrust chief, Thomas Barnett. The proposed deal would see Sirius buying XM in an all-stock deal worth $4 billion, effectively combining the only two satellite radio providers in the U.S.
The Justice Department and the FCC are currently reviewing the deal. Back in 1997, the FCC issued both companies licenses on the condition they would never merge. Sirius Chief Executive Mel Karmazin has promised that the combined company would not raise prices for customers. He believes the deal is not anti-competitive because traditional radio and even MP3 players could be considered competition for the services.
Source:
Reuters