Sirius And XM Satellite Radio Finalize Long-Delayed Merger

After more than 17 months of government scrutiny, the merger between Sirius Satellite Radio — home to shock-jock Howard Stern — and rival XM Satellite Radio — the exclusive carrier of Major League Baseball — was finalized!!


Tuesday (July 29). The news comes four months after the U.S. Justice Department approved the union and follows on the heels of last week's move by the Federal Communications Commission to give the deal its final blessing.

Prior to the merger's approval, the two companies agreed to set aside 8 percent of their combined channels for public-interest and minority programming, and instituted a three-year price cap. The new company will also offer "à la carte" pricing within three months of the deal's closure.

Now that the red tape has been cut, the newly formed company announced that going forward, it will use the moniker Sirius XM Radio. In a press release, the firm revealed that it is kicking off day one with more than 18.5 million subscribers, making Sirius XM the second-largest radio company in the U.S.

"I am delighted to announce the completion of this exciting merger between Sirius and XM," CEO Mel Karmazin said in a statement. "We have worked diligently to close this transaction, and we look forward to integrating our best-in-class management teams and operations so we can begin delivering on our promise of more choices and lower prices for subscribers."

The deal's main opposition had come from the National Association of Broadcasters, the trade group that represents free radio stations, which waged a lobbying campaign in Congress and at the FCC to stop the merger, arguing that it would create a pay-radio monopoly. But in March the Justice Department's Antitrust Division ruled that the merger would not harm consumers because there are enough other "competitive alternative services" to satellite radio.

As promised when the merger was first announced, existing Sirius and XM radios will continue to work as they have, and subscribers have the option of maintaining their current service package. As first proposed, Sirius and XM subscribers — who had been paying about $13 a month for the service — might end up paying as little as $6.99 with the proposed tiered pricing. In addition, the combined company plans to eliminate duplicative programming, including a number of music channels.

The merger was first proposed as a way of stemming billions in losses incurred in attracting on-air talent, sports deals and subscribers. Sirius said that the deal is expected to save the company about $400 million in 2009, and earn $300 million before interest, taxes, depreciation and amortization.


This report is provided by MTV News