Before everyone jumps to a conclusion that the merger decision is now complete, I want to caution readers that this piece carries some assumptions, and some reading between the lines. Like a puzzle, you oft do not need all of the pieces to have a general idea of what the picture has in store.

In a filing with the SEC today, XM pre-announced many of their metrics for the second quarter of 2008. As with all quarterly announcements, people tend to focus on items such as subscribers, churn, conversion rates, etc. However, sometimes there is additional language that has some new nuggets that could have important meaning.

I believe that this may be the case with the latest filing with XM Satellite Radio. Look at the filing, skip over the subscriber numbers, the churn, the conversion rate, and the size of the loss. While all of these are important, it is a small item after the loss that grabs the attention.

"(excluding the impact of any FCC settlement)"

The reason I find this interesting is that it is commonly assumed that Sirius and XM have some enforcement issues at hand before the FCC. It is widely known that some of these enforcement issues have been the topic of discussion in Ex Parte filings. It is also known that Sirius and XM have been meeting with the enforcement bureau lately. Add to this the fact that it is rumored that commissioner Tate wants some teeth behind this merger, and we may have a glimmer of some activity on the enforcement front.

Most people generally agree that it is commissioner Tate that is the focus of this merger now. Knowing that Tate wants some teeth in this merger, and knowing that there have been several meetings with not only commissioners, but Tate as well could lead one to believe that perhaps some penalties for past infractions (or alleged infractions) are being negotiated in conjunction with the merger.

It is no secret that there are quite a few "gray areas" with regard to the licenses of Sirius and XM. These gray ares have been subject to interpretation, and in many ways have caused this merger more than a few sticking points. Because of this, it would be of little surprise to me if a commissioner would want concrete points that are fully detailed and understood by all parties. Getting to this point would eliminate "gray areas" and allow the process to continue.