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

"They have voluntarily committed to setting forth price constraints, so the prices for consumers do not increase; smaller packages at lower prices; an open standard for radios; the sale of interoperable radios; and additional public-interest programming for noncommercial use and for qualified entities that have not been traditionally represented."

The smaller packages are part of the companies plan to offer programming similar to a la carte model the chairman supports and as a way to lower prices and increase choice for multichannel radio and TV. Those packages would be available about three months after the merger’s approval.

The two companies have committed to not raising prices for 36 months, to provide interoperable radios within a year of the merger’s approval  and dedicate 8 percent of their spectrum for noncommercial use.

The merger deal, offers 4.6 shares of Sirius for every XM share, is valued at around $7.54 billion, down from $11.4 billion when first announced in February 2007.
 

 Kevin Martin And The FCC Up Next

"[T]he evidence does not demonstrate that the proposed merger of XM and Sirius is likely to substantially lessen competition, and . . . the transaction therefore is not likely to harm consumers," according to a formal statement issued by the government entity.

Granted, the satellite radio market will be wrapped up.  Yet the DoJ took "AM/FM radio, HD Radio, MP3 players (e.g., iPods), and audio offerings delivered through wireless telephones" into consideration.  Add CD players and even in-car computers onto the list, if you like, and we wind up with a laundry list of options that should keep the combined XM-Sirius business from getting too strong.

Also, the DoJ believed cost savings will prevent the combined firm from trying to raise prices, anyway.  The two companies should be able to avoid, or at least streamline, a number of expenses after they begin working together.

A successful merger still depends on the FCC’s approval, but that isn’t seen as a major problem.  After more than a year of PR efforts and thumb-twiddling, it may not be too much longer until the companies instead have to focus on equipment compatibility issues.

 Specter Sees Resolution Happening Soon

During an interview on the Howard Stern Show, Senator Arlen Specter "said . . . a decision should reached by the end of the month," according to an Orbitcast article, which then added, "to his knowledge."

It’s not the strongest possible confirmation – Pat Leahy is actually the Senate Judiciary Committee’s chairman, and Specter’s statement puts uncomfortably narrow (and yet nonspecific) time restrictions on the matter.  But Specter is hardly out of the loop, so we may see something happen soon.

Also, in terms of what that something will be, it seems at least one important onlooker believes the merger will be approved.  As reported by Eric Savitz, a Stifel Nicolaus analyst stated, "The FCC rumblings bolster our sense that the DOJ will likely clear the deal followed by FCC approval with conditions."

Customers and investors surely remain anxious to see what happens; the stocks representing both XM and Sirius have risen quickly in the past couple of days.

Since I’m late and not interesting, we’ll give up on that game, OK? Heheh.

But, I’m probably one of the only bloggers who’s owned both a Sirius and an XM radio (my new Saturn has XM, my old Ford had Sirius). I can’t tell the difference between the two networks. Well, other than the channels’ numbers are different. So, I don’t see any great loss if these two systems merge.

Oh, great, I just pissed off all the NASCAR, Adam Curry, and Howard Stern fans who’ll write and remind me that those things are only on Sirius. OK, OK.

I love my satellite radio, but that AUX connector for iPods and Zunes on both of our cars has a strong calling too. I agree with Doc that listening to media you chose is a powerful thing. We have thousands of choices (maybe millions) and using an MP3 player we can listen to what we want, when we want it.

That said, I like the serendipity of listening to stuff I wouldn’t otherwise listen to. That, and podcasting won’t be able to compete with live news over CNBC or BBC or CNN.

Oh, on my Saturn I’ve already put 2,100 miles on the thing. Great car. Maryam’s mom likes riding in it better than she likes riding in the BMW (much more leg room in the back and softer ride). Oh, and the parking attendant at San Francisco’s Fairmont paid it a nice compliment. I’ve never gotten a compliment while driving the BMW. Of course, the fact that he probably parks a hundred BMWs in a day might have something to do with the compliment.

Me? Driving the BMW is more fun, but then I remind myself that I can buy two Saturns for the price of one BMW and all of a sudden the Saturn seems a lot better again.

Long and short of it? Neither system has that many subscribers. Most of my friends don’t have satellite radio. I doubt more than a small percentage of you do either. I bet more of you have HDTVs. Translation: this story doesn’t deserve the amount of pixels being killed for it.

Oh, if this all wasn’t clear: I love my satellite radio and can’t imagine a car without it anymore. But, then, I spend a LOT of time driving lately and I live in a place where radio signals don’t reach very well.

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It’s really not beyond the realm of possibility, at least not according to Google CEO Eric Schmidt. Google’s effort to personalize and localize advertising across various media could lead to your radio at least knowing where your car is, what direction you’re going, what’s nearby and what your typical routine is.

Cool? Well, yes.

Creepy? Definitely.

But we’re slowly getting used to being spooked.

Google, as do all advertisers, expresses a keen interest in targeting. Satellites are good at locating, monitoring, and delivering signals. Consider Google’s recent deal with XM Satellite Radio, whereby Google will deliver advertising inventory through XM’s non-music channels.

This inventory includes both national and local advertising, which can be piped through to the home or to the vehicle via one of XM’s auto partnerships to millions of subscribers.

From David Utter’s coverage:

With that in mind, Zdnet blogger Donna Bogatin reminds us of Schmidt’s pants scenario. Schmidt fantasizes about a day when radio ads address him personally, reminding him as he drives past a clothing store, that he needs a new pair.

Think of all the weight-loss revenue that could be generated. For an extra fee, XM could deliver a nagging voice every time you’re in the vicinity of Baskin Robbins, saying “you don’t need that ice cream, Big Bones” or “cookies can’t love you” or “you’re gonna banana-split your pants there, genius.”

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Google Ads To Appear On XM Radio

Advertisers on Google will be able to reach XM’s non-music listeners as part of a new agreement between the two companies. They have been testing the solution for several months.

Those advertising clients will have an automated method of placing audio ads via dMarc, a media ad network Google purchased in January 2006. AdWords clients should see general availability of the service in the fourth quarter of 2006.

Google plans to integrate the dMarc platform into AdWords. Clients can place audio ads for delivery to satellite and terrestrial radio listeners. Current dMarc customers can do so already.

Google also noted that dMarc simplifies the process of sales, scheduling, delivery, and reporting for radio ads. On XM, Google’s technology “automatically schedules and inserts advertising across XM’s non-music commercial channels, helping to increase revenue with a wealth of new advertisers, while decreasing the costs previously associated with processing advertisements.”

The technology will be tested in the marketplace as Google and its advertisers monitor how effectively Google can target ads to a listening audience. A successful run will benefit XM with much-needed additional revenue, while Google can count the deal as a substantial broadening of its existing advertising network.

The announcement today marks another step toward more focused advertising methods. Google’s wild success with contextually-targeted paid search advertising that is measurable and effective has yet to be duplicated across broadcast media. If they can accomplish this with radio, perhaps television will be the next stop for Google and its ad network.

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David Utter is a staff writer for WebProNews covering technology and business.