"Robbins stepped on sensitive ground when noting that 'just when we were getting close to a national music playlist, along comes satellite radio that actually plays music people want to hear.' NAB battled to stop the proposed XM and Sirius merger, which the Justice Dept. recently approved. Despite NAB's ongoing, bitter protests, the Federal Communications Commission is likely to approve the merger, too."

"We are astonished that the Justice Department would propose granting a monopoly to two companies that systematically broke FCC rules for more than a decade. To hinge approval of this monopoly on XM and Sirius's refusal to deliver on a promise of interoperable radios is nothing short of breathtaking."

Orbitcast has learned that the National Association of Broadcaster and Clear Channel have been working toward the ultimate goal of forcing Sirius-XM to surrender spectrum, according to an unnamed source.

According to the source, who agreed to reveal this information under condition of anonymity, the merger opponents have suspected all along that the merger would pass. Their strategy has been to make noise under the guise to block merger, then concede and compromise for a spectrum surrender.

"This has been the end game all along," Orbitcast was told.

Clear Channel's most recent filing further solidifies this theory. It also adds to the suspicion that the delay in coming to a decision over the Sirius-XM merger has been the negotiations on how much spectrum the companies will surrender.

I question the level to which surrendering spectrum would make the entire merger useless - and indeed, that may be the merger-opponents' game plan. As I understand it, surrendering spectrum is a deal breaker. Now, I can see Sirius-XM conceding to a "free to air" requirement - in that a percentage of spectrum is alloted to non-commercial/informational programming that Sirius and XM have no editorial control over (as brilliantly proposed by Gigi Sohn). But to carve out a chunk and divest at will? That seems like a deal breaker to me.

Last Friday, representatives of the NAB met with the FCC to chit-chat about none other than the Sirius-XM merger.

Those in attendance from the FCC were Helen Domenici (Chief of the FCC's International Bureau), Roderick Porter (Debuty Bureau Chief of the International Bureau), Gardner Foster (Legal Advisor) and Robert Nelson (Chief of the FCC's Satellite Bureau).

The NAB reps left behind a memorandum, which was subsequently filed with the FCC, which focuses completely on the spectrum usage. They argue that if Sirius and XM were allowed to merge, it would give them complete control of that piece of the spectrum (which historically the FCC has shied away from). This isn't much of a breakout from the NAB's prior arguments, but they are thin-slicing the subject.

Obviously, the NAB hasn't given up just yet. We are at Day 180 of the unofficial 180-day timeclock. Sure, the FCC could take longer, but this can't last forever... I hope.

[Read FCC filing (PDF)]

Just in case the Federal Communications Commission wasn't already aware of it, the Sirius-XM camp has filed an ex parte filing highlighting the NAB's dubious tactics for garnering "support" for their cause.

The counsel for Sirius Satellite Radio Inc. says little else in the filing beyond simply linking to the Washington Post article, but that's really more than enough for them to do. It's better to put the issue on record and let it speak for itself.

It still boggles me that the NAB needed to resort to these "inspirational" tactics so as to generate 8,500 form-letters, when they advocate on behalf of 8,300+ radio/TV stations and networks.

John Gorman said it perfectly in a recent blogpost:

"Is this how your NAB members want their money spent? Is this the image the radio industry wants or needs right about now?"

I would wager to say the answer is a resounding "no" and the NAB will have a lot of explaining to do once this is all over.

[Ex Parte filing (PDF) via SiriusBuzz]

Representative Rick Boucher (D-VA) wrote a piece that ran in both the Washington Times (yesterday) and a similar piece that ran in BusinessWeek (a week or so ago).

In both, Boucher dismisses antitrust concerns by building a case as to why satellite radio is part of a greater "audio entertainment" market, and argues that the Sirius-XM merger would benefit listeners.

"At first blush, one might conclude that a combination of the only two providers of this satellite-based service would be an obvious antitrust abridgement. In fact, the 'bumper sticker-like' campaign of merger opponents stresses the harm of a 2-to-1 combination.

The reality of the relevant market, however, is both more subtle and more compelling."

I think that's the basis of this entire argument. Whether you consider satellite radio to be within its own silo, or whether you feel that satellite radio directly competes with other audio mediums.

Rep. Boucher addresses this debate in his piece, talking about his view of the competitive landscape:

"[Regulators] often ask, 'How far would a person have to drive in order to find a substitute?' In the case of XM and Sirius, consumers don't have to drive anywhere to find a competitive alternative: They just have to hit a different button on their car stereo."

It's that ease of switching between audio mediums that, in my opinion, is the biggest case for the merger. And ultimately, it's what protects the consumer from a combined company abusing "monopolistic" powers.

Aside from the argument about whether or not a merger would create a monopoly (which has been discussed here ad nauseum), I think it's great to see Sirius-XM getting this level of public political support. The NAB is quick to point out that they got X number of Congressmen to sign a document, but there's little in public support coming from those in Capitol Hill for their cause.

[BusinessWeek, Washington Times]

Yesterday, the Thanksgiving Day post lightly touched upon what the Washington Post uncovered recently: that many of the "comments" submitted to the fcc against the Sirius-XM merger were simply generated through a dubious pop-up ad campaign.

This issue goes far beyond the use of form letters. I'm no lawyer, but this appears to border on all out fraud.

Form letters can be a "useful" tool for large groups to assemble their thoughts en masse. I don't necessarily like them (I would much prefer the public submit in their own words), but at least the submitter is voicing their opinion and is aware of it.

But what the NAB has done here is not at all a case of "form letters."

The Washington Post discovered that out of the 60 people they contacted - many of the phones were actually disconnected, or went unanswered. Out of the 10 people they were actually able to talk to (which - in itself - is a ridiculous rate of failure), only 1 person - ONE PERSON - even remembered filling out something remotely related to satellite radio (and not even being merger related).

So how did those comments get submitted to the FCC?

According to the Washington Post article, the NAB bought pop-up ads on websites like CarMax.com, Staples.com and PriceGrabber.com in August and September. The ad ran the headline, "The XM Radio/Sirius Merger will create higher prices. Stop the Monopoly!" - and users could click either, "Yes, I'd like to help stop the monopoly" or "No, thank you."

Those who clicked "yes" were asked to type in their contact information and later received a confirmation e-mail "detailing their action and providing a copy of the letter to be sent to the FCC," according an NAB spokesperson. Respondents were given the "opportunity to opt out of the process" and cancel submission of their letter.

If I'm reading that correctly... it means that any inaction to the email was considered confirmation. So if these emails were sent to the Spam folder, or were inadvertently deleted, the submission was still considered confirmed.

And there's another question...

So far only a little over 5,000 computer generated emails have hit the FCC and, as the article points out, many with the names and addresses of people who said they never filed any comments regarding the merger. But the NAB states in the article that 8,500 comments were "inspired" by this campaign.

That means some 3,500 more "comments" with dubious provenance are waiting to appear. Where are they? When will they show up? Why have they been withheld?

I don't care if you're pro- or anti-merger. If you have an opinion on the merger - whatever it may be - you should have submitted your comments to the FCC. That is your right as a citizen, and it's the whole purpose as to why the FCC has a public comment submission process.

These phony letters corrupt this entire process and are in sharp contrast to the thousands of Americans who took time to write genuine, thoughtful letters to the FCC.

The fact that the NAB - which advocates on behalf of over 8,300 radio and television stations and networks, and has an annual NAB Radio Show which reportedly is attended by over 110,000 industry professionals - simply cannot garner enough genuine public support for their agenda is telling. Very very telling.

But just because the public isn't agreeing with a lobbyist's position doesn't mean they should resort to these tactics. It is the public who should decide how to voice their opinion, not a special interest group.

A Call To Action:

The more I think about this, the more angry I get. Again, we're not talking about form letters (which, sadly, is a standard lobbying practice) - I'm talking about people participating as part of a legal process without knowing they are. In the Washington Post article, it was pointed out that a poll of 350 congressional staffers conducted by the Congressional Management Institute in 2005 indicated that half of them did not believe that form-letter messages were sent with the knowledge or approval of constituents.

How long has this been going on? How many other comments from "the public" aren't genuine? How exactly are all these comments being extracted, especially considering WaPo's astonishing rate of failure in contacting submitters? Are these in fact even real people?

We need to ask Congress and the FCC for an inquiry. There needs to be some accountability here.

Regardless of whether you support or oppose the merger, we need to know the extent of these practices. How exactly were these comments were "inspired" by the NAB? If you feel the same way as I do, then please voice your opinion and contact Congress/FCC to demand an inquiry.

There's several ways to do this (like, contacting the FCC directly or check out the EFF's guidelines for contacting Congress). XM and Sirius also have handy-dandy pages that submit your comment to the FCC and copy your state's representatives (here's XM's version, or Sirius' version - they both do the same thing).

However you do it, just remember this issue is not about the merger itself, rather an inquiry into these deceitful and dubious tactics. Those of us who's actually spent the time to submit a unique and thoughtful comment shouldn't be undermined by a pop-up ad.

Have a Happy Thanksgiving everyone!
...and in between naps after gorging yourself with food today - check out this Washington Post article about the form letters reportedly generated by the NAB and subsequently submitted to the FCC.

The Washington Post has contacted several of the people - who's names are now on record as supporting the NAB's political agenda - and many of them had no idea that they would be submitting comments to the FCC.

"No sir, I never sent any notes to Washington," said William Chadwick, a retired truck driver from Lebanon Junction, Ky., whose name is attached to one of the messages that reached the FCC. "This call is the first time I've heard of this."

"I never sent an e-mail," said Frank Dashields, a Salisbury, Md., building-services manager. "I don't even know about the issue."

"I don't know what the merger is about and I don't care," said Tom Biniecki, a retired steel worker from Winamac, Ind. "I have no idea what you're talking about."

Apparently the form emails (which you can read more about here) were sent to the Commission after people clicked on an ad that read, "The XM Radio/Sirius Merger will create higher prices. Stop the Monopoly!" The ad invited users to choose either, "Yes, I'd like to help stop the monopoly" or "No, thank you."

It's an incredible article, and one that speaks volumes of the NAB's tactics. Well worth the read.

[The Washington Post]
Thanks to everyone who sent this in!

Earlier today an anonymous reader sent me the following email from David Rehr sent out to NAB members. It's interesting to read only because it shows how the NAB seems to now have a heightened sense of importance when it comes to the battle over performance royalties.

When it comes to picking and choosing battles, it baffled me that the NAB focused so much on the XM-Sirius merger (or satellite radio in general over the past 13 years), when there's just far more pressing issues for them to devote resources towards. This email illustrates that perfectly...

Read the email after the jump....