In the Interest of the Public Public Interest Set-aside Is Critical To Justify XM - Sirius Satellite Merger

In the Interest of the Public
Public Interest Set-aside Is Critical
To Justify XM - Sirius Satellite Merger

In 1945, the FCC set aside frequencies in the then new FM band for public service radio. That decision eventually resulted in public radio: NPR, American Public Media, PRI and some 2900 public radio stations throughout America. Today, the FCC Commissioners have another opportunity to demonstrate their obligation to support the public interest. In approving the merger of XM and Sirius satellite radio, they can require conditions that will affect future generations of Americans as much as their predecessors' 1945 decision has.

In a matter of hours or a day or two, the FCC will be creating an unprecedented monopoly in one category of the broadcast spectrum. Rather than the “business merger” approved by the Justice Department, the FCC approval will create a “spectrum merger” monopoly – something few have focused on.

Commissioner Deborah Taylor Tate has the final vote on this merger – the swing vote – and the leverage to require appropriate concessions for allowing a monopoly merger. If the FCC approves the XM-Sirius merger without a public interest set-aside of channels receivable by all audiences without obligation, fees or authority of the Sirius-XM management, or without mandating access to local digital radio services, it will be granting an entire technology to one entity with no return to the public. It is similar to their granting the entire FM spectrum to Clear Channel without requiring anything for the public that they represent. Proponents have argued for 25% of the channels for the public interest and minorities. FCC Chairman Martin has suggested 8%. Setting aside 25% of this satellite spectrum would enable 75 national public service stations to be created. The Chairman's proposal of 8% would equate to a mere 24 channels. Somewhere in that range there is a compromise. But what is cruical is that those channels be “open access”. That they be free of control by XM-Sirius. That all Americans with satellite receivers be able to receive them without cost, and that the monopoly operator (XM-Sirius) not be able to dictate programming, channel operators, programmers, or costs.

The current FCC commissioners can be visionary, as their predecessors in the 1940s were, or they can surrender the public airways to a single commercial entity. To do the latter without any gain for the public is unconscionable.

Non-commercial, non-profit broadcasters need long-term assurances of their right to broadcast on these channels in order to justify investment in them. Similar to terrestrial broadcast licenses, a public interest set-aside assures the permanent use of that part of the spectrum. Non-commercial broadcasters should not be at risk of being removed for XM-Sirius business reasons or of having escalating charges for non-commercial use of the channels. For the public good, for the principles of the First Amendment, and to provide some balance to this explicit monopoly, non-commercial broadcasters need to have control of their channels unfettered by the owner of the satellite system.

While NPR, American Public Media and PRI advocate setting aside 25% of the satellite radio capacity (spectrum and booster spectrum), we are most strongly concerned about the independence and open access of whatever spectrum the Commission allocates.

Open access is consistent with the philosophy of public service channels. Open access ensures public access without restrictions, and it is the price the satellite operator should pay for the monopoly use of the remainder of this spectrum.

This set-aside would benefit the public interest through increased diversity of programming on satellite radio. Such expanded diversity would also benefit XM-Sirius as an incentive for consumers to purchase satellite radio receivers.

In addition to a public interest set-aside for the satellite spectrum, the FCC should require that all satellite radio receivers be capable of receiving the new digital radio signals broadcast by local radio stations. This would put local radio on a par with satellite, assure access to local weather and safety information, and partially offset the negative consequences of a monopoly on the satellite spectrum.

With foresight, the FCC Commissioners can leverage the US Congress' investment in public radio. Without the assurance of public interest set-aside spectrum and signal agnostic HD digital radio receivers, the public interest will not be served by this merger.

The FCC's decision sets the path for satellite radio. Will that path continue the American tradition of serving the public interest, or will it serve the private interests of the XM-Sirius monopoly? That decision rests today with the three FCC Commissioners who are voting for this proposal against the objections of the two who do not support creating a monopoly of such unprecedented magnitude. We hope they have not forgotten the American public ñ the people they were placed in office to represent.

Dennis Haarsager	Interim CEO	National Public Radio
William H Kling	President & CEO	American Public Media
Alisa Miller	President & CEO	Public Radio International

July 24, 2008