WASHINGTON DC: Increasing speculation about a merger of financially challenged US satellite radio companies XM and smaller rival Sirius has prompted media watchdog chief Kevin Martin to warn that such a deal would be impossible under current rules.

The Federal Communications Commission chairman says there is a ban on a single owner for both services written into the regulations that authorize the two nationwide licenses.

He added, after an FCC meeting: "There is a prohibition on one entity owning both of these businesses."

XM and Sirius have increased subscriber numbers in the last year [WARC News: 11-Jan-07], albeit missing targets, but neither has made any money. A merger could save the emerging industry significant costs.

Industry analysts say a deal would require approvals from antitrust regulators as well as the FCC, and are divided over how easily these could be achieved.

Data sourced from New York Times; additional content by WARC staff