The proposed XM/Sirius merger was the topic du jour this afternoon at a House Judiciary Committee Antitrust Task Force hearing in Washington D.C. as Sirius CEO Mel Karmazin and NAB President David Rehr took center stage among those discussing the many issues surrounding the merger.

Chaired by Rep. John Conyers (D-MI), the Antitrust Task Force hearing consisted of over two hours of lively debate regarding the circumstances of the potential satcaster merger. Conyers kicked off the hearing by asking that if satellite radio is not just competing with itself, but with all audio options for consumers, then what precedent does that set for other business? "The critical issue is whether the relevant market is all forms of digital music or simply satellite radio,'' he said. "If we were to define the market as broadly as merger supporters advocate, what kind of precedent are we setting?''

Rep. Lamar Smith (R-TX) noted that "we are at the beginning of a long process," a point re-iterated by Karmazin during his remarks.

Rehr repeatedly referred to the proposed merger as creating "a government sanctioned monopoly" and also called it a "government bailout." He added that it would set a bad precedent and would undermine "audio competition, not enhance it." Rehr also said that XM and Sirius cannot be trusted with "monopoly power" because "both companies routinely and regularly violate FCC rules," referring to the satcasters' issues with regulations on their repeaters. He also reiterated the FCC's initial rules on satellite radio from a decade ago, noting that Sirius itself pushed for prevention of a monopoly. Rehr's full opening statement can be read here.

Karmazin argued that the merger is "not anti-competitive" and that satellite radio is competing with terrestrial radio, HD Radio, Internet radio and many other consumer options for audio entertainment. He said that he understands the satcasters must prove to the FCC that the merger is in the consumer's best interest and believes it would create more choices, lower prices and less confusion.

Karmazin also claimed there is currently a "great deal of confusion" in the marketplace with two different satellite receivers for two different companies at home and in different car models. Without saying so, it was almost an admission by Karmazin that he is asking the government to allow the merger to correct the mistake by XM and Sirius for not developing interoperable technology from the outset.

Karmazin insisted that satellite subscription prices will not be raised, but in fact lowered, because they are competing with terrestrial radio and "raising a price to compete with 'free' is bizarre." He added that they are willing to negotiate a pricing freeze for a period of time should the merger be approved.

Gigi Sohn, President of Public Knowledge, said that she believes the merger should be approved under three conditions: a la carte and tiered choices, more educational programming and no price increases for at least three years.