Sirius XM said it won’t raise prices this year.
The satellite radio company’s promise is part of the legal settlement of a suit filed by a subscriber in 2009 and that later became a class action suit. The suit said Sirius XM deceptively raised prices by adding music royalty fees and eliminating free Internet streaming. It said the price increase showed that the Sirius and XM merger in 2008 created a monopoly that violates the Sherman Act.
Only two weeks ago Sirius XM CEO Mel Karmazin had said the company was considering a price hike after July. He told analysts the price increase cover more than inflation costs.
Subscribers can rest easy at least until next year. Current subscribers will be able to renew their plans at the current rate through December 31, 2011. Also some former subscribers will be able to go to the Sirius XM Web site to sign up for a free month of service or a month of Internet streaming.
Sirius XM also agreed to pay up to $13 million in legal fees for the plaintiffs in the case Carl Blessing et al. v. Sirius XM Radio Inc.
The settlement is contingent upon approval by the U.S. District Court for the Southern District of NY.
Photo: Sirius XM CEO Mel Karmazin