Second commissioner votes 'no' on XM-Sirius deal

By JOHN DUNBAR

Associated Press Writer

WASHINGTON (AP) -- A Federal Communications Commission member who sought further concessions in a pending satellite radio buyout withdrew his offer Wednesday after it failed to draw support.

Democratic commissioner Jonathan Adelstein voted against Sirius Satellite Radio Inc.'s proposed takeover of XM Satellite Radio Holdings Inc. The vote of the five-member regulatory body now stands at 2-2, with Republican member Deborah Taylor Tate still undecided.

FCC Chairman Kevin Martin and fellow Republican Robert McDowell have both voted in favor of the deal. Democrat Michael Copps voted against it Monday.

Adelstein's vote puts even more pressure on Tate, who is seeking resolution of a pending enforcement action against the companies, according to public filings.

Citing unnamed sources, the Wall Street Journal reported Wednesday afternoon that Tate was expected to vote in favor of the deal "shortly" in exchange for a consent decree that resolves enforcement issues against the satellite companies that will cost them $20 million.

Adelstein released a statement Wednesday, explaining the reason for his negative vote.

"I was hoping to forge a bipartisan solution that would offer consumers more diversity in programming, better price protection, expanded choices among innovative devices and real competition with digital radio," it read. "Instead, it appears they're going to get a monopoly with window dressing. We really missed a great opportunity to reach a bipartisan agreement that would have benefited the American people."

Last week Adelstein said he would cast a third and clinching vote approving the buyout if the companies agreed to cap prices for six years and make one-quarter of their satellite capacity available for public interest programming, among other conditions.

His proposal sought stronger concessions than the companies offered voluntarily one month ago. That offer led to Martin's recommendation that the deal be approved.

Commissioners are able to vote on items "on circulation," meaning by way of computer, rather than at a public meeting. Those votes are generally not made public until all have been cast.

Adelstein has been a vocal opponent of big media mergers in the past, as has fellow Democrat Michael Copps.

The companies have agreed to submit to a number of conditions, including a three-year price cap, setting aside 8 percent of radio spectrum for public interest and minority programming and adoption of an "open radio" standard, that was less specific than what Adelstein was proposing.

Adelstein also wanted to set up an enforcement regime to make sure the companies adhere to the conditions, something that was not outlined in the previous voluntary offer.

Sirius and XM also have promised to include an "a la carte" offering that would be available within three months of the close of the deal. In addition, they have pledged to offer radios that are capable of receiving both XM and Sirius service within one year.