Sirius and XM report preliminary Q2 results; FCC approves merger

Sirius and XM report preliminary Q2 results; FCC approves merger

Sirius ended the second quarter of 2008 with more than 8.9 million subscribers, up 25% year-on-year.

XM ended the second quarter with 9.6 million subscribers, up 17% year-one-year.

Sirius's total revenue for Q2 2008 is expected to be up 25% to $283 million, for an adjusted operating loss of $79 million – a 70% improvement compared to the prior year period.

XM's subscription revenue for the quarter is expected to be between $283 million to $288 million, with an adjusted operating loss of between $32 million to $38 million.

Meanwhile, the Washington Post reports that the FCC finally approved the Sirius-XM merger on Friday (July 25th), the day after both companies agreed to pay $19.7 million in fines to resolve issues in connection with receivers and more than a hundred terrestrial repeaters that violated FCC technical rules.

XM is to pay $17.5 million and Sirius $2.2 million. Both companies said they would bring their equipment into compliance.

The US Dept of Justice approved the deal in March, saying the merger was not anti-competitive.

The merger of the two former rivals will create the country's only satellite radio company, with more than eighteen million subscribers.

The companies must also cap prices for three years after the merge, and must allow consumers to choose the channels they want and pay less for channel packages. The companies said they would introduce radios that receive both XM and Sirius channels.

Now the deal is as good as done, ZDNet's Larry Dignan's question about whether Sirius could have walked away from the deal and bought XM in bankruptcy is redundant. However, he wonders whether the new company will be able to (a) recover the enthusiasm that dwindled during almost eighteen months of red tape, and (b) can it compete with the iPod?

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