Xm Satellite Radio Inc

Federal regulators appeared poised Wednesday to give final approval to the merger of the nation's only two satellite radio operators, which would bring together the two struggling companies after a 17-month quest. Deborah Taylor Tate, a Republican who held the swing vote on the five-member Federal Communications Commission, reportedly was ready to vote in favor of the $3.9-billion merger if Sirius Satellite Radio Inc. and XM Satellite Radio Holdings Inc. agreed to new conditions.

XM Satellite Radio Holdings Inc. reported a year-end subscriber tally Friday that fell short of its earlier forecast, which had been lowered twice. XM, the larger of the nation's two satellite radio broadcasters, said it ended 2006 with 7.63 million subscribers. That was up almost 1.7 million from a year earlier but short of its most recent prediction of 7.7 million to 7.9 million. A year ago, XM was forecasting 9 million subscribers at the end of 2006.

The Federal Communications Commission said licenses held by XM Satellite Radio Holdings Inc. and Sirius Satellite Radio Inc. would prevent them from combining, but one industry expert said they could ask for the licenses to be modified. "There's a prohibition on one entity owning both of those licenses," FCC Chairman Kevin J. Martin said. However, Martin also said the FCC would examine any transaction submitted to it.

A lawsuit in which record companies allege XM Satellite Radio Holdings Inc. is cheating them by letting consumers store songs in a device can proceed toward trial, a judge ruled Friday after finding merit to the companies' claims. U.S. District Judge Deborah A. Batts made the finding in a case brought by Atlantic Recording Corp., BMG Music, Capitol Records Inc. and other music distribution companies against the licensed satellite radio broadcaster.

The world's two providers of satellite radio agreed Monday to merge in a $4.6-billion deal, vowing to end their brutal battle for customers and work together to persuade more people to pay for a medium that most use for free. In implicitly acknowledging that the market can't support two such services, the deal by Sirius Satellite Radio Inc. and XM Satellite Radio Holdings Inc. also posed a bigger question: Can it support even one? More than 80 million people listen to AM or FM radio.

XM Satellite Radio Holdings Inc., which last week announced plans to combine with rival Sirius Satellite Radio Inc., said Monday that a 45% jump in revenue and a tighter leash on marketing costs helped narrow its fourth-quarter loss. The Washington-based company, which has never reported a profit, said it lost $263.1 million, or 90 cents a share, after paying preferred dividends in the final three months of 2006. That beat a loss of $270.4 million, or $1.22 a share, a year earlier.

Sirius Satellite Radio Inc., which has agreed to acquire its rival XM Satellite Radio Holdings Inc., reported a narrower loss for the fourth quarter as revenue more than doubled. Sirius had a net loss of $245.6 million, or 17 cents a share, in the last three months of 2006 versus a loss of $311.4 million, or 23 cents, in the same period a year earlier. Revenue more than doubled to $193.4 million from $80 million a year earlier.

Despite vowing not to raise their prices, the nation's only two satellite radio providers found their proposed merger to be a tough sell Wednesday on Capitol Hill. "You've got some high hurdles to overcome, don't you think?" House Judiciary Committee Chairman John Conyers Jr. (D-Mich.) told Mel Karmazin, chief executive of Sirius Satellite Radio Inc. Karmazin, who would run the new company if federal regulators approve Sirius' proposed merger with XM Satellite Radio Holdings Inc.

The chairman of the Senate's antitrust subcommittee Tuesday blasted the proposed merger of the country's two satellite radio providers, saying it would create a "business colossus" that would raise prices for listeners. "You have every right to ask ... but it's another thing to grant you that permission to be virtually unrivaled, unchallenged in this whole area," Sen. Herb Kohl (D-Wis.) said at the third hearing on Capitol Hill over the merger. "What a business!

XM Satellite Radio Inc. was sued by publishers of such songs as "Let It Be" and "Me and Bobby McGee." The suit, filed in U.S. District Court in New York, accuses Washington-based XM of infringing the publishers' music "on a massive scale."