Washington — Thomas Hazlett, the former Chief Economist of the Federal Communications Commission (FCC) released a study commissioned by XM and Sirius that found a merger would benefit consumers.
The study was submitted today to the FCC, said XM and Sirius.
The study noted that the $3 billion to $7 billion that investment analysts predict will be saved by a merger, “will permit more aggressive investment in satellite systems and products and prompt competitive responses from terrestrial broadcasters and other rivals.”
The study claimed “By any measure, satellite radio is dwarfed by terrestrial radio,” noting that terrestrial radio had revenues of over $21 billion in sales in 2006 compared to $1.6 billion for satellite radio.” In market value, terrestrial radio weighs in at $82 billion compared to $9 billion for XM and Sirius combined.
The merger would also result in a wider array of popular programming to subscribers and in lower prices for the service and receivers, the study said.