Pat Dollard

Tweet

WAPO:

Senior members of the Congressional Black Caucus yesterday criticized a compromise plan for the proposed merger of the XM and Sirius satellite radio companies, saying the deal does not provide enough opportunities for minority-owned programming.

Federal Communications Commission Chairman Kevin J. Martin said over the weekend that he would support the merger after XM Satellite Radio Holdings and Sirius Satellite Radio voluntarily agreed, among a series of other concessions, to lease 4 percent of their radio spectrums, or 12 channels, for programming run by minorities and women.

Members of the black caucus on Capitol Hill have been arguing for the merged company to lease five times that amount of spectrum to companies owned by racial minorities. Short of that, caucus members have warned in letters to the commission and meetings with Martin, they would oppose the merger.

In an interview yesterday, Rep. G.K. Butterfield (D-N.C.), chairman of the Congressional Black Caucus’s working group on satellite radio, called Martin’s proposed compromise “completely unacceptable.”

He said he and other members of the working group planned to express their dissatisfaction today to top executives of XM, which is in the District, and Sirius.

Other prominent members of the caucus also expressed misgivings about the XM-Sirius plan. Rep. Elijah E. Cummings (D-Md.), a former chairman of the caucus, said yesterday that he was “extremely upset” about the proposed deal and that he would speak to his colleagues about taking action to stop the merger — perhaps legislative action — unless the percentage is increased.

“It’s shocking to the conscience in this day and age, where the minority populations comprise a significant part of the satellite radio audience, that Mr. Martin would settle for what I deem to be crumbs that have fallen off the table,” Cummings said. “We can do much better. I am hoping that this can be revisited.”

Spokesmen for XM, Sirius and Martin declined to comment.

The satellite radio networks were told a month ago that a sizable leasing agreement would be needed to get the backing of members of the caucus, congressional insiders said. During a meeting in the Rayburn House Office Building, Mel Karmazin, the chief executive of Sirius, was asked sharp questions by aides to black caucus members, according to staffers in attendance.

Karmazin repeated, however, that too large a set-aside would be too costly for the company and would endanger the transaction and the viability of the merged company. His refusal to get closer to the black caucus’s demand has stirred anger among lawmakers ever since, said the staffers, who spoke on condition of anonymity.

Butterfield said that black caucus members planned to meet today with Karmazin and Nate Davis, chief executive of XM. “We’re going to close the door and have a very honest and open dialogue about the merger,” Butterfield said. “If they cannot meet us on any reasonable terms, we are going to be very adamant about not approving the merger. It’s not in the public interest. They are not concerned about the cost to the consumer.”