Satellite radio: Monopoly or competitor?

Sirius, XM logos on satellite radios

SCOTT JAGOW: Two companies that aren't supposed to merge are XM and Sirius. They're the country's only satellite radio networks. But they want to join forces. And this week, they'll make their case before Congress. Nancy Marshall Genzer reports.


NANCY MARSHALL GENZER: Under current FCC rules, XM and Sirius couldn't merge because they would become a monopoly. But the companies argue they do have competitors — everything from HD radio to iPods. Analyst Blair Levin of Stifel Nicolaus says the government may buy that argument.
BLAIR LEVIN: This is like trying to define a rapidly morphing amoeba. What is the relevant market here? Does it include iPods?

So what are consumers supposed to do? American University economics professor Robert Lerman says don't buy any new satellite radio paraphernalia.

ROBERT LERMAN: You may spend a hundred dollars on a device and find four months from now that it doesn't pick up the stations that it was intended to pick up.

Lerman says, while you're waiting, let Congress know what you think about the proposed merger.

In Washington, I'm Nancy Marshall Genzer for Marketplace.

About the author

Nancy Marshall-Genzer is a senior reporter for Marketplace based in Washington, D.C. covering daily news.

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