FCC commissioner key to XM-Sirius vote

By Peter Kaplan

WASHINGTON (Reuters) - As the Federal Communications Commission considers whether to allow the two U.S. satellite radio companies to combine in a controversial deal, all eyes are on FCC Commissioner Deborah Taylor Tate.

Tate, one of three Republican commissioners on the FCC, has emerged as the swing vote as the five-member commission weighs a proposal that would let Sirius Satellite Radio Inc acquire arch-rival XM Satellite Radio Holdings Inc.

"She'd rather not be the tie-breaking vote, but I think however you slice it, she is," said one source closely following the FCC review of the deal worth $2.8 billion at Monday's closing stock prices.

The FCC decision is the final hurdle in a regulatory marathon for the deal that was first announced in February 2007. Antitrust authorities at the U.S. Justice Department approved the merger in March this year after concluding it would not harm consumers.

Two weeks ago, FCC Chairman Kevin Martin proposed that the agency approve the deal after Sirius and XM agreed to abide by conditions to protect consumers and preserve competition.

Among other things, the companies promised to make 24 radio channels available for noncommercial and minority programming, according to FCC sources. In addition, the companies pledged to cap prices, make interoperable radios available to consumers and offer programming on an "a la carte" basis.

Martin's other Republican colleague, Robert McDowell, is expected to vote in favor of the deal. Both Democratic commissioners are still skeptical, according to sources within the FCC.

That leaves Tate, whose term expires later this year, as the decisive vote. She could use that power to push for additional enforcement provisions to the deal to ensure that Sirius and XM follow through on their promises, the sources said.