No one was quite sure why the
Federal Communications Commission
took nearly a year and a half to review the merger between
XM Satellite Radio
. Many people wondered what exactly it was the FCC was doing during that interminable wait.
Now we know, thanks to a nearly year-long investigation by the House Committee on Energy and Commerce, which
released a report
on its findings Tuesday. The report's damning title,
Deception and Distrust: The Federal Communications Commission Under Chairman Kevin J. Martin
, gives away the plot of the entire 110-page summary.
The report discusses in detail instances in which Martin manipulated, withheld or suppressed data, reports and information. The investigation also found that important FCC matters were not handled in an open and transparent matter, which raised suspicions that interested parties and various issues were not treated fairly.
"He left us a blueprint of what not to do as chairman of such a critical agency," said Rep. Bart Stupak (D-Mich.), chairman of the Subcommittee on Oversight and Investigations, on a conference call for reporters.
Most damaging to Martin was the investigation's finding that his "heavy-handed, opaque, and non-collegial management style" created an environment of distrust, suspicion and turmoil for the other FCC commissioners.
"Even trivial, routine matters must be cleared by the Chairman's office," the report stated. "Chairman Martin's office micromanages virtually every aspect of agency management, resulting in decision paralysis at the Commission."
The Committee's findings also showed that Martin's poor management style has persisted through his entire tenure and has caused a continuous backlog of matters still waiting for his review. That would explain the 17-month wait for the FCC to finally support the merger of
. Many shareholders continue to blame the FCC's delay for the rapid decline in share price, as synergies the joined company expected came far later than anticipated.
Sirius XM stakeholders aren't the only ones who should be miffed by the contents of the report. Among Martin's other transgressions, the Committee found that his lack of oversight of the Telecommunications Relay Service Fund, which pays for special relay services for people with hearing or speech disabilities, resulted in overcompensation of service providers by as much as $100 million a year. Those costs were ultimately passed along to those disabled consumers.
"If there was a fleecing of America that went on underneath Mr. Martin's leadership, with his knowledge and consent, this is one that must be redone and overhauled," said Stupak.
Additionally, the probe found that Martin manipulated or withheld information relating to the benefits of cable and satellite companies pricing individual channels on an "a la carte" basis, which was one of the major negotiating points in the Sirius and XM merger. Several cable companies, including
Time Warner Cable
, have fought Martin and the FCC on the issue.
"The quicker Mr. Martin leaves the FCC, I think it is ... fair for all of us," said Stupak. "We need a fair, impartial FCC with professional staff who are willing to work with not just the Congress but more importantly with the other commissioners."
Too bad those criteria weren't properly laid out when Martin was appointed to the position in 2005. Here's hoping the next FCC chairman will use that blueprint and not deliver more of the same.