Some Dynamics of High-Tech Merger Analysis in General and with Respect to XM-Sirius
Thomas W. Hazlett
George Mason University Dept. of Economics and School of Law
July 24, 2008
George Mason Law & Economics Research Paper No. 08-45
Journal of Competition Law and Economics, Forthcoming
Horizontal merger evaluation is heavily reliant on market definition. While a SSNIP framework formats the analysis, demand elasticity evidence used to apply the test is often sparse, as is often found in high-technology industries. This paper examines other sources of evidence that reveal the dynamics of market structure, data that are also probative in the evaluation of competitive effects. These sources include capital valuations of firms, financial event studies, and the public positions taken with respect to the merger by interested parties. Such evidence is examined in the XM-Sirius merger (2007-08), and shown - in two of the three instances - to be relatively informative in merger welfare analysis.
Number of Pages in PDF File: 21
Keywords: critical loss analysis, FCC, horizontal merger evaluation, NAB, SDARS, Sirius, XM, SSNIP test
JEL Classification: K21, L41, L82Accepted Paper Series
Date posted: July 31, 2008
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