Motley Fool On Satcaster Merger: 'FCC, Decide Already!'
May 29, 2008 at 10:03 AM (PT)
MOTLEY FOOL stock advisor RICK ARISTOTLE MUNARRIZ bluntly laid it on the line in assessing the FCC's long-delayed decision on the satellite radio merger: It's now or never.
"As embarrassing as it might be for the FCC to have taken more than 15 months -- and counting -- to rule on the merger, we're close to the point where there may be blood on the regulators' hands," he wrote. "I am not saying regulators should have approved the deal last year. What I am saying is that they should have approved or killed the deal last year. What the FCC is doing now is the bureaucratic equivalent of a snuff film."
What the FCC is doing now is the bureaucratic equivalent of a snuff film
MUNARRIZ expects the FCC to demand concessions partly as a cover for its indecision: "If the FCC simply nods or shakes it head, unconditionally, the public will wonder why it didn't make this call last year."
Some concessions, such as a temporary subscription-rate freeze are do-able. "As long as it doesn't get in the way of offering premium services such as backseat video (at SIRIUS) or traffic navigation (at XM), it shouldn't be a dealbreaker." However spectrum space sell-back would "wipe out channels for those with current receivers that receive only XM or SIRIUS," and replacing all existing radios with interoperable units is a non-starter because the satcasters couldn't afford doing it.
"In short, the FCC keeps slurping satellite radio's milkshake, but the quality of the milkshake is now a concern."
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