MONDAY JUNE 16
Breakthrough In $5 Billion Merger?

Sirius Satellite Radio’s proposed buyout of rival XM Satellite Radio has been left in the lurch for over a year, but a crucial regulatory vote could tip the balance in its favor – especially now that a key player in the approval process has signaled a willingness to let the acquisition move ahead, provided the following conditions are met.

June 2008

The chairman of the Federal Communications Commission is recommending approval of the $5 billion merger between the nation's two satellite radio broadcasters in exchange for concessions that include turning over 24 channels to noncommercial and minority programming, The Associated Press has learned.

That condition -- along with others, including a three-year price freeze for consumers -- convinced FCC Chairman Kevin Martin on Sunday to recommend approval for Sirius Satellite Radio Inc.'s buyout of rival XM Satellite Radio Holdings Inc. The deal affects millions of subscribers who pay to hear music, news, sports and talk programming, largely free from advertising, in homes and vehicles.

Martin's recommendation sets the stage for a final vote on the closely watched merger, which could occur any time after his recommendation is circulated among his fellow commissioners.

The other four commissioners have, for the most part, kept their views on the deal to themselves. Unlike most FCC decisions, there is no clear indication on how the vote will go.

The proposed merger has been in a holding pattern during an FCC approval process that has gone on for more than a year.

Martin said the conditions will make the combination of the two companies good for consumers.

"As I've indicated before, this is an unusual situation," Martin said in a statement. "I am recommending that with the voluntary commitments they (the companies) have offered, on balance, this transaction would be in the public interest."

The companies also agreed to an "open radio" standard, meant to create competition among manufacturers of satellite radios, according to FCC officials who spoke on condition of anonymity because the agreement has not yet been made public.

Continue reading on NYTimes.com

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