MUMBAI: The merger of two major US satellite radio companies, XM and Sirius was on the verge of approval on Wednesday when Federal Communications Commission’s republican member Deborah Taylor Tate was supposed to vote in favor of the deal.
Tate’s vote would break a deadlock along party lines among the other four commissioners. Tate would join Kevin J Martin, the chairman, in supporting the merger, with certain conditions, say reports.
Democratic FCC Commissioner Jonathan Adelstein had cast his vote against the deal after he and Martin could not come to terms on additional conditions Adelstein wanted to impose. Adelstein argued saying it was not in the public interest to let the only two companies in a particular business combine.
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In March, the Justice Department, which reviews deals on antitrust grounds, approved the proposed $5 billion merger. Agency officials said they did not view the deal as creating a monopoly because of the many alternatives in audio programming, like iPods and HD Radio.
Under his plan, the price caps would have been extended to six years, the number of set-aside channels would be increased to 25 percent of the companies’ total capacity, and new satellite radio receivers subsidized by XM and Sirius would have had to also receive high-definition terrestrial radio.
The combination of Sirius and XM would create one satellite radio company with about 17 million subscribers and programming that would run the gamut from Howard Stern to Oprah Winfrey, Major League Baseball to Martha Stewart.
After the approval, Mel Karmazin chief executive of Sirius would run the combined company. Karmazin was the chief architect of merger with XM and previously ran CBS and was president of Viacom.
This vote would end the nearly 18-month Government review of a deal that would essentially create a monopoly in satellite radio. The companies would be liable to pay a $20 million fine for alleged past violations of Federal Communications Commission’s rules.
