Story ID: 
Merger talk clouds wx data’s future
By: Stephen Pope
Caption: Wall Street analysts now say the proposed merger between XM Satellite Radio and Sirius should have little difficulty winning approval from the Federal Comm
Word Count: 539
Wall Street analysts now say the proposed merger between XM Satellite Radio and Sirius should have little difficulty winning approval from the Federal Communications Commission (FCC) and Department of Justice. That could spell trouble for buyers of aviation weather datalink gear.Most datalink weather receivers work over the XM satellite network. Data provider WSI has bucked the trend by teaming up with Sirius for a competing service. Deliveries of WSI’s new InFlight AV-300 series datalink weather systems started in September. The series includes the Sirius-compatible AV-300 and -350 models as replacements for the former AV-100 and -200 series products, which WSI no longer supports.Assuming the XM/Sirius merger goes through, the combined company is unlikely to continue offering weather data services on both satellite platforms. While the deal is being billed as a merger of equals, analysts say Sirius technically is acquiring XM for $4.57 billion in stock. That could have an impact on which services and channels are retained after the dust from the merger settles. Sirius CEO Mel Karmazin would retain his title with the new company. XM CEO Hugh Panero has already stepped down.While it’s too soon to say how the merger would affect current owners of aviation weather data-link receivers, there is no guarantee that a particular service will continue to be supported after the companies become a single entity. But it could take time–perhaps years–for any decision about the satellite weather portion of the services to be made. Neither company views weather data delivery as a priority.Merger Looks LikelyA DOJ decision on the merger could come as early as this month, analysts say. “Everything we’re hearing is that the merger will go through and it will happen in the next 30 to 45 days,” said Bear Stearns managing director and senior analyst Robert Peck, speaking at the ICSe Satellite Investment Symposium on October 9. XM and Sirius filed their merger petition with the FCC in March. At the time, many analysts were bullish about its chances for success, citing FCC rules and recent instances where similar types of merger were scuttled. Analysts, however, say that if the DOJ gives its blessing, the FCC will be unlikely to move to block an XM/Sirius merger.Shareholders for the companies are scheduled to vote on the deal on November 13. If DOJ and FCC approval follows fairly quickly, as analysts expect to happen, the merger should close late this year or early next year. For now, satellite weather datalink equipment makers are proceeding as though both services will be around for a long time, which could well be the case. Buyers are likely to be somewhat apprehensive about purchasing a particular datalink system until after all the merger details are announced.The XM and Sirius satellite weather services operate over the continental U.S. and portions of Canada and the Caribbean. Makers of XM weather receivers include Garmin, Rockwell Collins, Avidyne, Heads Up Technologies and WxWorx. Pricing for the XM and Sirius/WSI services is $30 or $50 a month depending on the level of data the subscriber receives. The hardware equipment sells for around $1,000 up to about $6,000. Many receivers can access satellite audio programming in addition to continuously updated weather graphics and text reports.