The alliance includes virtually all the nation's major terrestrial broadcasters, which together wield considerable lobbying clout on Capitol Hill. If these top companies were persuaded to withdraw their opposition to the deal, through inclusion of HD technology in satellite radio sets, it could help clear the way in Congress and the FCC for approval of the merger.
However, the proposed action has drawn criticism from consumer advocates, lawmakers, and terrestrial radio broadcasters as a monopoly in the making, with no real benefit to subscribers. Sirius CEO Mel Karmazin, who engineered the deal, responded with a proposal for an a la carte subscription plan--said to have the approval of FCC chairman Kevin Martin, who favors a la carte subscriptions for cable television, too.
But lobbyists representing terrestrial radio, like the National Association of Broadcasters, have attacked Karmazin's a la carte plan as a fig leaf for the monopoly, saying it still delivers little in the way of consumer choice.
So far, Karmazin has opposed including HD technology in Sirius and XM sets. But the HD Radio Alliance hopes that the prospect of more consumer choice will sway Congress and the FCC, which are especially amenable to such popular causes in an election year.
Martin, under fire from Congress for pushing through a divided FCC vote on media ownership rule this December, is said to be seeking consensus votes from the five-member FCC, bringing together its three Republican and two Democratic commissioners. The inclusion of HD technology may be enough to satisfy Democratic commissioner Michael Copps, who generally opposes media consolidation but favors increasing consumer choice.
The FCC will hold its vote after the Department of Justice vets the merger for anti-trust issues.