Newsroom: Media Ownership

For Immediate Release

Consumer Groups tell FCC XM and Sirius Satellite Radio Merger is Not in the Public Interest

Washington, DC — Consumer groups call on the Federal Communications Commission to reject the proposed XM/Sirius satellite radio merger in comments filed today.

Consumer Federation of America, Consumers Union, Common Cause, and Free Press ask the FCC to reject the merging parties’ proposal to define the market to include all forms of one- and two-way communications services. Instead, the FCC must closely analyze the product and geographic market characteristics and reject the merger accordingly.

XM and Sirius are asking the FCC to define the satellite radio market very broadly to include the ipod, internet radio, and other forms of communications—creating an illusion of a market with more competition than actually exists and hiding the anti-competitive and anti-consumer effects of the merger.

"Approval of a merger based on an overly broad definition of the market is likely to result in rising prices, denial of choice, declining quality and slowing innovations," said Mark Cooper, Director of Research for the Consumer Federation of America."Merger analysis does not rest on theoretical discussions of what people might do in some distant future, but what people actually do today and are likely to do in the near and mid-term," added Cooper.

"The merger of XM and Sirius satellite radio can only be called one thing—a monopoly—leaving no choice or competition in the satellite market," said Gene Kimmelman, Vice President of Federal and International Affairs for Consumers Union. 

Satellite radio subscriptions are growing at a rapid rate—14 million in just five years, with predictions the subscriptions will rise to as many as 40 million in the next few years.

The groups’ comments state that: "The merger does such harm to the competitive fabric of the industry that there can be no pretense that merger conditions could somehow repair the damage. Short term price protection for consumers will not compensate for long term pricing abuse, the loss of choice among competitors, or the elimination of competition as the driver of program development and service innovation."

To view the full comments, click here.

Contact: Mark Cooper, CFA, 301.384.2204 or Jennifer Fuson, CU, 202.462.6262

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