Satellite Monopolies?

If The New York Times says a Sirius-XM merger is “sure to raise antitrust issues” then I’m happy to believe them. I have a hard time seeing a serious issue here, however. As is typical in these cases, the relevant think is the definition of the market. If you think there’s a discrete “satellite radio” market then, yes, a combined Sirius-XM entity would clearly have monopoly power in that market. Realistically, though, the product both Sirius and XM are selling — audio broadcasts — is one for which there’s a great deal of competition. Cable and satellite television providers are capable of delivering similar content, though in not as convenient-to-use a manner. People can listen to CDs, buy internet music subcription services, subscribe to “podcasts,” and, of course, satellite radio needs to compete with its freely available terrestrial radio counterpart.

After all, at the moment I — like most Americans — don’t have a satellite radio subscription even though I’m pretty gadget inclined. The logic of the business is that the merged entity needs to grow, which is to say continue trying to offer a deal that people find appealing compared to our many other entertainment options, not our satellite radio options.