Radio Merger May Rest on One Vote By AMY SCHATZ Wall Street Journal
July 23, 2008 http://online.wsj.com/article/SB121674651820674047.html?mod=2_1571_topbox WASHINGTON -- The proposed merger of XM Satellite Radio Holdings Inc. and Sirius Satellite Radio Inc. could hang on a single vote at the Federal Communications Commission. The votes of three of five FCC commissioners are in. Two favor the merger and one opposes it. That leaves the fate of the two satellite-radio companies in the hands of Democratic commissioner Jonathan Adelstein or Republican commissioner Deborah Taylor Tate. Democratic commissioner Michael Copps voted against the deal Monday night, an FCC official said. Mr. Copps has been a vocal opponent of media consolidation, and the companies weren't holding out much hope of winning his approval. Two other commissioners, FCC Chairman Kevin Martin and Robert McDowell, both Republicans -- have voted to clear the merger. While there is no guarantee the deal will be approved, the commissioners are trying to find a compromise on conditions that would allow it to move forward. Last week, Mr. Adelstein offered a deal for his vote, which includes a variety of conditions that the two companies find unappealing. Among them are a six-year price cap for existing subscribers, a 25% set aside of channels for noncommercial and minority-owned radio stations, and a requirement that the combined company introduce a radio that would receive high-definition signals from terrestrial radio stations as well as those of XM and Sirius. The offer was viewed as an attempt to start negotiations, but the companies so far are showing little interest in haggling with Mr. Adelstein, one FCC official said. Instead, Ms. Tate has become the focus of lobbying efforts. She remains the only FCC commissioner who hasn't spoken publicly about how she feels about the deal. An adviser to Ms. Tate didn't respond to requests for comment. The performance royalty fees that satellite radio pays singers were among the issues raised last week at a meeting between Ms. Tate and Mitch Bainwol, chairman and chief executive of the Recording Industry Association of America. Ms. Tate, who hails from the country-music center of Nashville, Tenn., considers royalty rights for artists an important issue, a person familiar with the discussion said. Traditional over-the-airwaves radio doesn't pay royalty fees to singers, but satellite and Internet radio do. Both Mr. Adelstein and Ms. Tate are waiting to be reconfirmed by the Senate for another term on the FCC, which has increased the ability of both sides to pressure them. Mr. Adelstein and Ms. Tate are focused on several outstanding enforcement problems that have been raised, mostly by broadcasters, who have opposed the deal. Broadcasters have complained that Sirius has yet to bring to market an interoperable radio despite an FCC requirement that the companies develop one. Complaints about satellite booster towers being located in nonapproved locations and radio receivers that exceeded the FCC's power limits have also been discussed. The FCC may opt to deal with the outstanding enforcement issues in a consent decree with the companies, although it could take a few more days to hammer out details. An FCC spokesman declined to comment. ================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 antunes at uh dot edu ******************************* * POST TO [EMAIL PROTECTED] * ******************************* Medianews mailing list [EMAIL PROTECTED] http://lists.etskywarn.net/mailman/listinfo/medianews
