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Opposition to XM and Sirius merger grows

Tuesday, March 20, 2007

Public Interest Group Opposition to XM and Sirius Grows
Satellite Radio Does Not Compete with Other Traditional Listening Services

Washington, DC— Public interest opposition to the proposed XM-Sirius Radio merger grew today as six non-profit consumer, free-speech and democracy organizations asked the Senate Judiciary Committee to urge tough regulatory scrutiny of the deal.
In a written statement submitted to the Senate Antitrust Subcommittee today, Consumers Union, Consumer Federation of America, Free Press, Common Cause, Media Access Project, and Prometheus Radio Project said the proposed merger will reduce competition, jeopardize consumer choice and increase prices. The groups are members of the Media and Democracy Coalition, a coalition working to stop further media consolidation and guarantee that Internet and broadband access are affordable, accessible, and available to all.
The groups challenged XM and Sirius Radio’s arguments that the satellite radio market competes with other listening devices, like broadcast radio, digital Internet content, and other mobile handheld devices.
“We urge Congress and regulators to look at the satellite marketplace and to be skeptical of the parties’ unsupported arguments that other audio devices and service compete with satellite radio on price, product, and service,” said Jeannine Kenney, a senior policy analyst with Consumers Union. “Satellite radio is a different experience— offering a unique mode of delivery and a unique product.”
“What the satellite radio companies are selling is good pulp fiction, but it gets an F in antitrust analysis. It fails entirely to analyze the actual product and geographic market in which satellite resides,” said Mark Cooper, Director of Research for the Consumer Federation of America. “Airplanes do not compete with automobiles and satellite radios do not compete with iPods. Satellite sells national, mobile, commercial free, unrestricted radio content, something local radio cannot do,” added Cooper.
The six groups told the Judiciary subcommittee that it would be a mistake to assume that satellite radio is merely one product option in a larger media market. They urged Congress to tell the FCC and antitrust authorities to put the brakes on the merger unless and until significant questions on competition and consumer impacts are fully addressed and satisfactorily answered.
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Click here to read groups’ statement
Contact: Jennifer Fuson, CU, 202.462.6262