Justice Department OKs Sirius-XM Radio Merger

[Hum]

WASHINGTON -- The Justice Department on Monday approved Sirius Satellite Radio Inc.'s proposed $5 billion buyout of rival XM Satellite Radio Holdings Inc., saying the deal was unlikely to hurt competition or consumers.

The deal was approved without conditions despite opposition from consumer groups and an intense lobbying campaign by the land-based radio industry.

The combination still requires approval from the Federal Communications Commission, which prohibited a merger when it granted satellite radio operating licenses in 1997.

The Justice Department, in a statement explaining its decision, said the combination of the companies won't hurt competition because the companies are not competing today. Customers must buy equipment that is exclusive to either XM or Sirius, and subscribers rarely switch providers.

"People just don't do that," said Assistant Attorney General Thomas Barnett, in a conference call with reporters.

The government also appeared to endorse the argument of the companies that they compete with other forms of audio entertainment, including "high-definition" radio, Internet-based radio stations and even devices like Apple Inc.'s (AAPL: 139.53, +6.26, +4.69%) iPod.

"The likely evolution of technology in the future, including the expected introduction in the next several years of mobile broadband Internet devices, made it even more unlikely that the transaction would harm consumers in the longer term," the Justice Department said.

The buyout received shareholder approval in November. The companies said the merger will save hundreds of millions of dollars in operating costs -- savings that will ultimately benefit their customers.

XM Satellite shares rose $1.97, or 16.5 percent, to $13.90 in afternoon trading after the government's announcement, while Sirius shares rose 28 cents, or almost 10 percent, to $3.18.

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[SuperJediMedia]

As you may know today, Justice department allowed XM Radio to merge with Sirius (Both the biggest Satellite radio providers)

What does it mean to the consumers?

Would the price go up, or become cheaper?

Usually, a lack of competition means more expensive.

[k22]

they have already said that they will offer a la carte choices that will allow prices to go down if you choose to exclude some content.

also, Sirius is buying out XM. the content will merge and they may rebrand it, but when people ask "who is acquiring who" the real answer is Sirius is buying XM.

[SuperJediMedia]

I also wonder for those already got a Reciever for whatever service it is (Either XM or Sirius) since Day 1. Would they need to rebuy another receiver, or their receiver will work 100%?

[John S. Veteran]

threads merged

[richp21]

baseball on sirius!! Yeah!!

[SuperJediMedia]

http://money.cnn.com/2008/03/24/news/compa...sion=2008032415

What this means for consumers

Since Sirius and XM are still awaiting approval from the FCC, it is unclear exactly what a merger would mean for consumers. Both companies charge their customers a $12.95 per month subscription fee for their most basic packages.

Some have feared that if Sirius and XM are allowed to merge, the two companies would raise the monthly price.

However, the companies said last year that they would be willing to offer a so-called "a la carte" price plan where consumers could pick certain packages ranging from $6.99 a month to $16.99 a month. The two companies have also maintained that a combined service offering the best of both companies' offerings will cost less than the $25.90 a month that a consumer would currently have to pay to subscribe to both Sirius and XM.

"The combination of our companies will lead to more choices and better pricing for our subscribers, and result in a stronger competitor in the rapidly evolving audio entertainment market," said XM in a message to subscribers on its Web site after the DOJ announced it had approved the deal.

baseball on sirius!! Yeah!!

Football on XM!! Yeah!!

I also wonder for those already got a Reciever for whatever service it is (Either XM or Sirius) since Day 1. Would they need to rebuy another receiver, or their receiver will work 100%?

In its statement Monday, XM reiterated that radios owned by its current subscribers would not need to be replaced in order to continue receiving programming.

Sweet!

[RangerLG]

Football not on XM and baseball not on Sirius unless you get a new dual sub radio and subscribe to both "Everything" packages.