Copps Votes No: FCC Still Haggles Over XM-Sirius

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FCC Still Haggles Over XM-Sirius
By Amy Schatz

WASHINGTON – Three votes have now been cast in the Federal Communications Commission's review of the XM Satellite Radio Holdings Inc. and Sirius Satellite Radio Inc. merger, but the deal is still no closer to being done.

Democratic FCC commissioner Michael Copps voted against the deal Monday night, an FCC official said. It's the first vote against the deal. Two other commissioners – Chairman Kevin Martin and Robert McDowell – have voted in favor of the merger.

Mr. Copps's decision to nix the merger wasn't a surprise; he's been a vocal opponent of increased media consolidation and the companies weren't holding out much hope of winning his approval.

But the decision now increases pressure on another FCC commissioner – Republican Deborah Taylor Tate – who is the only member of the five-person board who hasn't spoken publicly about how she feels about the deal or what she might want to approve it.

Late last week, another FCC commissioner, Democrat Jonathan Adelstein, laid out what conditions the companies would need to meet in order to get his vote. They include a six-year price cap for existing customers, interoperable radios that would also receive HD signals from terrestrial radio stations and a 25% set aside of channels for non-commercial and minority-owned radio stations.

Although that offer was seen as an opening salvo in an effort to get discussions moving, very little haggling has been going on about Mr. Adelstein's offer, one FCC official said.

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The stocks dropped like a rock on this news, check the charts.

http://img88.imageshack.us/img88/4285/54216723gi7.png

I don't know why, which one of you (not anyone here obviously) was expecting Copps to come out and holds hands with Sirius and XM and sing songs? Is there anyone who invested in these companies and wasn't aware of Copp's position from the start? That my friends is a scary thought.

EDIT: Tyler's post What Happened When Copps Shot His Bullet clears up what probably went down.

So that makes three official votes, Martin and McDoweel for, and Copps against.

Adelstein is throwing out outlandish proposals, and Tate is cowering in the corner with a lamp shade over her head wishing the phone calls would stop. I think its interesting that Copps didn't even comment on or support Adelsteins proposal.

The "ten day window" that starts after three votes have been made only applies here no?

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3) The final 2 Commissioners (likely to be the 2 Democrats—Copps and Adelstein) customarily have 10 days following the Monday after the 3rd Commissioner vote (likely to be either McDowell or Tate) to submit their votes. Precedent indicates Democrats would probably not try to delay the approval process further if 3 other Commissioners vote in favor of deal.

[Merger Signed, Sealed And Awaiting Delivery]

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Or is this only for following three POSITIVE votes?

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Originally Posted by zcurzan

So that makes three official votes, Martin and McDoweel for, and Copps against.

Adelstein is throwing out outlandish proposals, and Tate is cowering in the corner with a lamp shade over her head wishing the phone calls would stop. I think its interesting that Copps didn't even comment on or support Adelsteins proposal.

The "ten day window" that starts after three votes have been made only applies here no?



Or is this only for following three POSITIVE votes?

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If its 3 Positive votes why vote anymore because it would be approved?

I don't know the summary of David Banks comment provided by Tyler in his article are vague.

I don't if they ten days is used after 3 positive votes to hurry the process along, get all commissioners on record and prevent someone from intentionally delaying a decision he/she is against. Even if only 3 are required for approval I assume for completeness they would want all commisioners on record as having voted. When a president gets a majority of votes do they simply close the polls?

Or it could be in general that once a majority has voted, the idea of forcing the remaining 2 votes prevents a process from dragging out. Once a majority has come to some decision positive or negative, the remaining two should be able to rather quickly.

Side note:

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Although that offer was seen as an opening salvo in an effort to get discussions moving, very little haggling has been going on about Mr. Adelstein's offer, one FCC official said.

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Doesn't this lend support to the view that Tate is drawing up her own set of conditions that are less onerous. Or even better, that she will ultimately follow Martin and McDowell? You would think if Mel thought that the bone Adelstein threw was his saving grace he would be in meetings with him trying to talk it down.

zcurzan, That is correct, if I read you right. It is costumary, so that other commissioners cant hold out until hell freezes over.

All of us who read this website expected Copp's vote to be what it was. I think the fact that he voted now might (and that's a big might) move the others along. After all, they can hide less now that less of them are being watched and pressured. I think the fact that Tate has not come public with her comments says nothing - nothing positive, nothing negative. She is obviously playing her cards her way. What interests me personally is the fact that Adelstein, having asked for so much from Sirius and XM, soon after said he is open to compromise. That sounds more like he is trying to move more towards the "yes" column (unless he is playing a good game of poker). Perhaps his initial huge demands were what he believes, perhaps he was just posturing for either his own political gain or his using the large concessions as bargaining chips. I have no idea. But, the fact that he publicly announced his willingness to negotiate (instead of just saying so privately during meetings) is a net plus. Unrelated to Adelstein, another thing I find interesting is that after the initial downward stock prices after Copp's "no" vote became public, at the close Sirius was down only 4 cents, XM up 3 cents, with volume not too high. There was not any great sell-off. That is probably a good stock price sign when one considers that most of the public who invest in Sirius and XM don't even know the names of the FCC commissioners, and what we, who follow these two stocks intently, expected their individual votes to be. After a "no" vote, with the stocks ending without much of a change I think is a good sign of their price support at this time. Good luck to all of us!!!

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But, the fact that he publicly announced his willingness to negotiate (instead of just saying so privately during meetings) is a net plus.

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I wouldn't say he's trying to move towards the yes column. If anything its a ass covering maneuver so he doesn't lose face with anyone. He can say to the public, "I tried" and he can say to the anti-merge lobby "I tried". The fact that Sirius has done little to negotiate terms with Adelstein according to the WSJ shows that they take his claimed flexibility with a grain of salt.

I think its funny that Wienkes can make all holy hell rain down on these stocks, but Commission Copps can only cause a hiccup.

When I saw that sharp downturn, I googled for news and found nothing. I came here next to discover that you and the front page reporter had it. Sure created an excellent buying opportunity. Fortunately, it was viewed as such and the SP rebounded on both SIRI and XMSR. Good Luck to all us holders.

Hi Zcurzan! After reading your response to my comment about Adelstein moving more toward "yes," I think I was wrong. I think you are right to say that Adelstein is just covering his ass and trying to look like a reasonable person when he stated that he is open to compromise. After his having said he is open to compromise, he really doesn't have to do anything or budge an inch to look diplomatic. He is covered both if the merger fails and if it goes through (with currently worked out concessions or with more stringent conditions). With his initial strong stance, and then his professed willingness to be open to compromise, he has already shown the folks back home that he is "their representative." I hope we are wrong about his self-serving ulterior motives, but it was a smart move on his part regardless, and a free advertisement for him of his "reasonableness."

Yeah I mean its all speculation at this point. No one can really know their thought process, and to tell you the truth they probably won't become completely transparent even once the official vote is handed down. But at least we can move forward after that.

Personally, I think the only explanation I would find reasonable at this point is that Tate's family has been kidnapped, and ransomed for a merger delay. Who's got a set of eyes on Rehr?

IIRC, all FCC members typically get replaced by any new administration. Its a cushy job that gets handed to political friends not unlike ambassadorships. Perhaps it benefits current members to show a certain face for future lobbying jobs or other similar endeavors. I don't think any of the current FCC members have any illusions about keeping their positions for any significant period after the end of Bush's term. Even McCain would be highly likely to can the lot of them and replace them with his own cronies.

deew, you are incorrect. It is the Chairman who is selected by the President. The other 4 are selected by the president as well, but when they are brought in, they are brought in for 5 or 6 year terms (IIRC). Tate and Addelstein are up for replacement later this year. Copps and McDowell are staying for another 3 (?) years.

In that case, is it likely or even possible that Tate or Adelstein could stay on past their term's expiration date if the new prez likes them? Or is it 100 percent guaranteed that they must leave upon expiration of the term of their "service"?

I'm sure you've all heard about the impending fines by now. While this blows (as everything has during this FCC process), I think it signals that everything is almost done. Tate wouldn't call for fines first if she wasn't going to vote for the merger.

As for Copps vote, it was a given. 2 to go.