FCC's Adelstein, Tate cross the aisle over XM-Sirius

Quote:

---

Tate has been pushing the agency's enforcement bureau to fine both XM Satellite Radio Holdings Inc. and Sirius Satellite Radio Inc., two companies that are seeking regulatory approval from the FCC for a $13 billion deal. At least that's what people close to the Republican commissioner are saying. Tate declined to comment to The Deal about the XM-Sirius deal on Monday, but according to regulatory filings has met with attorneys for both companies and enforcement bureau staffers to discuss the issue.

...

Adelstein also reiterated his push to have an independent committee to monitor whether the combined company complies with merger conditions imposed by the commission. Adelstein said he hoped the monitor committee would reflect the type of independent review trustees the Federal Trade Commission employ to oversee whether that agency's merger conditions are complied with.

Presumably, the independent committee would be paid for by XM-Sirius funds but be approved by FCC officials.

---

http://www.thedeal.com/dealscape/200..._cross_the.php

Do whatever you gotta do Deb, enforce the hell out of us. If this is all she wants to tack onto Martin's proposal I would be very pleased. Anyone see any added cost to the combined company in this scenario besides one-time fines? (Of which there has been no real discussion of dollar amount) If they are required to pay for the committee, how much could that even be? I can't imagine it being a huge burden.

A legal way to pay off the FCC for approval?

The FCC's own account? The General Fund? The US Treasury? Sent to the banks as a drop in the bucket toward the trillion dollar bail out?

I don't know. I haven't really followed enforcement allegations from the beginning but from what I understand they are pretty legit. One is arguably in a grey area: interoperability. So I tend to think, fair is fair. You break the rules and get caught you square up.

I know that I'm not supposed to speed, but I do it anyway because let's face it, the open road in front of me is too enticing. "I swear officer I was just going with the flow of traffic." Get stopped, pay the ticket, and move on down the road.

Quote:

---

Originally Posted by deewcom

The FCC's own account? The General Fund? The US Treasury? Sent to the banks as a drop in the bucket toward the trillion dollar bail out?

---

Please make all checks payable to "Chester Davenport". C-H-E .....

Actually you were dead on. They go to the blackhole that is the United States government.

Quote:

---

Where do those fines go, you ask? Good question. They go straight into the Federal Treasury, to pay for things like war and the deficit (for a full breakdown of Federal spending, check out the good folks at the National Priorities Project).

---

http://turtel.wordpress.com/2006/05/...media-justice/

I agree that the companies probably should be fined, which might also keep some of the post-merger vultures off their back (ahem - not mentioning any names). At this point, any continued deliberation and delay will likely be more costly to the companies.

Someone on the Yahoo boards took a page from the NAB playbook and drafted Tate some talking points for her approval of the merger:

Quote:

---

"Originally, I wanted to impose some sort of fines on Sirius and XM for noncompliance issues. However, I realize that by our delaying the merger for 490 days that we have cost Sirius and XM billions of dollars in lost revenue, synergies, and market capital. Therefore, I am voting YES to approve the merger with no conditions. I apologize for this disservice to our country and am pushing for mandatory time frames on future merger deliberations."

---

Now what are the odds of her taking their advice? haha

zcurzan, I read someplace that when one of the companys of terrestrial radio had to pay for several hundred violations over the years, it was something like 100,000 dollars or some small amount. It was so long ago I cant remember how much, but it was pretty small. It might have even been at Sirius Buzz I read it. I think it was in a comments section on a article It might have even been Tyler who said it responding to someone I am not sure. I am pretty sure Tyler knows about it though.

zcurzan, P.S. I am warming up my, "I told you so" on that Tate issue, LOL.

Quote:

---

Originally Posted by john

zcurzan, P.S. I am warming up my, "I told you so" on that Tate issue, LOL.

---

Refresh my memory. Is that the "I told you so" that Tate is not going to impose HD chips?

Quote:

---

Originally Posted by john

zcurzan, I read someplace that when one of the companys of terrestrial radio had to pay for several hundred violations over the years, it was something like 100,000 dollars or some small amount. It was so long ago I cant remember how much, but it was pretty small. It might have even been at Sirius Buzz I read it. I think it was in a comments section on a article It might have even been Tyler who said it responding to someone I am not sure. I am pretty sure Tyler knows about it though.

---

Quote:

---

The House on Wednesday overwhelmingly passed a bill that would raise the maximum fine for indecent broadcasts to $325,000 -- ten times more than the current limit of $32,500. The 379-35 vote follows passage of the same bill in the Senate and sends the measure to President Bush, who will likely sign it into law.

---

http://www.zap2it.com/tv/news/zap-fc...,5564960.story

Now obviously those figures are regarding indecency, and they are a little dated. For enforcement issues I am getting numbers all over the board from Google, seems like its really subjective. So Tate is either going to try to lay it on thick to make a point, and to maybe win Adelstein, or maybe the real issue here is just resolving the disputes so they are no longer outstanding.

Cant' wait to find out.

All fines handed down by the EB of the FCC are deposited with the US Treasury Dept.

Indecency Fines used to by levied at $27,500 per incident, however Congress jacked that up to $325,000 per incident a couple years ago.



As for XM/Sirius -- I've speculated for some time that I wouldn't be surprised to see a consent decree with a fine come out, as part of the merger... A consent decree is a legal finding/agreement between the FCC and the company involved. It's an agreement reached, rather than going through the NAL process. The FCC outlines what rules were violated and the license holder outlines steps taken to fix and prevent the violation from reoccuring -- and if it does... then accountability. In most cases, in the consent decree, the license holder doesn't admit any guilt... but not always the case.

I see XM/Sirius copping to the repeater and FM transmitter issue -- and what they've done to fix the problem(s); but I don't see them copping to anything with the interopability issue. I do expect them to agree to make the "voluntary donation" to the US Treasury Dept. that typically goes along with these decrees. I can see each "donating" as much as the higher 6 figures to settle the matter.


-----

zcurzan, on that Tate/HD issue, yes.

homer, I agree, I also think we are talking about small fines being paid considering what kind of deal we are talking about (the merger).

Quote:

---

Originally Posted by zcurzan

Please make all checks payable to "Chester Davenport". C-H-E .....

---

Well played! The spelling it out part made me chuckle :thumbup:

Does anyone know how Sirius's stock price will be calculated when the 4.6 shares areexchanged for XM's shares?

Will they use the Sirius stock price at the time the FCC announces approval for the merger, will it be Sirius's stock price at the end of the day, or perhaps even Sirius's closing price from the preceeding day.

There could be a considerable difference in Sirius's stock price and, thus, what the final value will be for XM shares.

In the unlikely event that approval comes during the regular market, I believe the prices of both stocks would be halted.

FWIW, and this is from the Yahoo board so that is very little, someone said CNBC mentioned $20 million fine for enforcement issues. I'm not in front of a TV.

"In the unlikely event that approval comes during the regular market, I believe the prices of both stocks would be halted."


zcurzan, I dought it, both will trade up to the transfer.

Zurczan, Even though I would consider that alot for the violations that is still better then the HD issue. For this merger to be approved I would call that a drop in the bucked.