If a merger between Sirius Satellite Radio and XM Satellite Radio is approved, customers who want to take advantage of programming from both companies would have to pay more than they do now for either service, Sirius CEO Mel Karmazin told a Congressional hearing Wednesday.
Congressmembers expressed confusion during the hearing over what would happen to prices if the merger was approved.
Karmazin, who would take over as CEO of the combined company, said that customers who stick exclusively with either Sirius or XM programming would not have to pay more than the current rate of $12.95 for the service. He told the members of the House Commerce Committee¹s subcommittee on Telecommunications and the Internet that this price will actually drop if the customer opted for less programming.
But Karmazin also said that if a customer wanted programming from both companies, prices would rise above the $12.95 rate that each firm charges per month. He would not specify what that rate would be, though he said it would be less than the combined rate of $25.90.
Karmazin said he would be open togovernment-imposed price controls, as he had indicated in a previous hearing.
“You can come up with a way of holding our feet to the fire,” Karmazin said.
He also said that he could not guarantee that the company would offer a la carte channels.
Karmazin maintained that both D.C.-based XM and New York-based Sirius could survive on its own if a merger is approved. Neither company is profitable right now.
