Fourteen states' attorneys general join opposition to XM + Sirius

If the merger must go through, a group of states' legal leaders now contend, then at the very least, the FCC could mandate that the merged Sirius publish its specifications for interoperable receivers as open source.

In a phone conference July 1 with US Federal Communications Commissioner Deborah Taylor Tate, representatives of fourteen states' attorney generals' offices, including the attorneys general of Tennessee and Connecticut, collectively voiced their opposition to the merger of Sirius and XM satellite radio recently approved by the Justice Dept. And in a filing with the FCC Thursday, the Tennessee A-G's office states they questioned the DOJ's logic that compelling or forcing the merged parties to develop a standard for interoperable radios would be anti-competitive.

As an alternative, the A-Gs suggested that the FCC impose a restriction not only calling upon the merged entity -- Sirius, for which XM would be a division -- to produce interoperable radios, but to publish the standard publicly, effectively making it "open source." This way, anyone could build a satellite radio, effectively neutralizing the DOJ's argument.

"If there is any competitive source of programming preserved by the Commission -- which the States urged the Commission to do -- the success of that competition in delivering the public interest benefits will likely depend on consumer access to the entire spectrum of satellite programming through interoperable equipment," reads the report of Tennessee Attorney General Robert Cooper of last week's phone conference (PDF available here). "Accordingly, the States urged prompt deployment of and a stringent timeline for commercialization of such equipment. Additionally, the States urged that the Parties [XM and Sirius] be required to promptly make the intellectual property needed for compatible and competing equipment freely available to ensure that the increased market strength they obtain through their combination is not inappropriately extended into other lines of commerce."

The A-Gs also rejected the argument, Mr. Cooper writes, that automobile manufacturers would reject open source designs on their face, saying instead that manufacturers are typically more interested in "more robust and flexible equipment."

Cooper's report notes that the FCC ordered Sirius and XM in 1997 to devise interoperable receivers, though it provided them with no real timeline for doing so. It implied that the FCC did nothing to enforce that order, but if it had, several of the benefits that the prospective partners point to as flowing from their merger would have already been realized -- not just interoperable radios, but more diverse programming options, more family-friendly programming, and a la carte pricing for consumers.

Also represented on last Tuesday's call were the attorney generals' offices of Iowa, Kansas, Louisiana, Maryland, Mississippi, Missouri, Nebraska, Ohio, Oklahoma, Rhode Island, Washington, and Wisconsin.

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