Dear Chairman Powell:

In a May 22, 2002 letter, we expressed our concern that XM Satellite Radio was pursuing permanent licenses for their terrestrial repeater network as part of satellite digital audio radio service (SDARS). If licenses for the network are permanently granted, then XM could combine this repeater network with their patented technology to provide localized programming, an activity which the Commission has previously indicated should be prohibited.

In your June 12, 2002 response, you stated that the Commission is aware that XM's repeater network could allow localized programming and that XM had stated its patent is not intended to provide local programming. Our concern regarding permanent licenses has significantly increased with the recent announcement by XM of a new service that would transmit localized weather programming to marine, aviation, and emergency subscribers. It is clear that nothing now stops XM from taking this a step further and offering local programming in the terrestrial radio market to hundreds of thousands of automobile subscribers.

We maintain convinced that the final licenses for SDARS repeaters should prohibit these devices from in any way participating in the delivery of localized programming. Given this latest expansion into localized programming, we believe that the Commission must guard against the possibility of XM eventually trying to skirt the intent of the Commission, should it determine XM cannot offer localized programming through the repeater network.

In order to be effective, the Commission should require XM to fully disclose all business and technology plans for offering localized programming to determine exactly what XM plans to do in the terrestrial radio market for which it is seeking these repeater licenses. This knowledge is necessary for the Commission to make a fully informed final license decision.

Sincerely,

W.J. "Billy" Tauzin
Chairman