Sirius-XM merger rosy potential questioned

March 7, 2007 at 5:41 PM
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WASHINGTON, March 7 (UPI) -- A U.S. regulator raised questions on potential savings and program upgrades for subscribers if Sirius Satellite Radio and XM Satellite Radio merge.

Kevin Martin, Federal Communications Commission chairman, suggested details about possible rates and services were unclear from testimony corporate officials gave recently before a U.S. House of Representatives panel, The New York Times said Wednesday.

"When they talk about freezing rates and lowering rates, are they talking about it in terms of the current rate of $12.95 for each service, or are they referring to the combined rate of $25.90?" Martin asked.

Mel Karmazin, Sirius chief executive officer, said his testimony wasn't misleading. Subscribers keeping their existing service would not be charged more and anyone wanting to cherry-pick the best of both services would pay less than the combined rate of $25.90.

Martin noted that subscribers may be surprised to learn they may pay more for additional features that currently are competing services.

Martin said "a need for greater clarity" exists, the Times' article said.

The $13 billion merger needs approval from the U.S. Justice Department and a majority of the five FCC commissioners. The FCC issued the companies licenses in the 1990s on the condition that they not merge.

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