June 25 (Bloomberg) -- Sirius Satellite Radio Inc.'s bid to buy XM Satellite Radio Holdings Inc. may depend on a regulator who says she sometimes struggles to find a balance between the needs of consumers and industry.

Deborah Taylor Tate, one of three Republicans on the five- member Federal Communications Commission, may be the swing vote as the agency considers whether to approve the merger of the only two U.S. pay-radio companies, and under what conditions, said Stifel Nicolaus & Co. analyst Blair Levin.

``It's not clear what she would want,'' said Levin, a former FCC chief of staff who is based in Washington. Republican FCC Chairman Kevin Martin recommended approval of the merger on June 16, and the remaining Republican member, Robert McDowell, ``pretty clearly'' will vote for the takeover, Levin said.

The agency's two Democrats, who have consistently opposed media consolidation, haven't said publicly how they will vote. One of them, Jonathan Adelstein, said last month his vote would depend on what conditions are attached to a takeover. The other, Michael Copps, called the merger ``a steep climb'' in a June 16 statement.

Opposition by the two Democrats probably would give Tate a decisive vote on the merger and any conditions. Martin is calling for price constraints and suggests setting aside 8 percent of the airwaves used by XM and Sirius for competing minority broadcasters and noncommercial stations.

McDowell continues to meet with interested parties and hasn't decided how to vote, said spokeswoman Brigid Calamis.

Shares Fall

Traditional radio companies, led by the National Association of Broadcasters, say the combination of XM and Sirius would replace competitors with a monopoly, and they oppose it. XM and Sirius say consumers will benefit from greater choice and lower prices.

The Sirius-XM transaction is valued at $2.84 billion based on today's closing prices. New York-based Sirius, with 8.6 million subscribers, is offering 4.6 of its shares for each of Washington-based XM, which has 9.3 million subscribers.

Sirius rose 7 cents to $1.93 at 4 p.m. New York time in Nasdaq Stock Market trading. XM advanced 17 cents to $7.95. XM has fallen 43 percent since Feb. 16, 2007, the last closing price before the deal was unveiled. Sirius has dropped 48 percent.

In early June, as Martin was nearing his recommendation for approval, representatives of XM and Sirius visited Tate three times, according to FCC records. McDowell had one meeting, and the Democrats didn't have any.

Meetings With Tate

Tate's meetings included one with Sirius Chief Executive Officer Mel Karmazin and XM CEO Nate Davis.

``The attention focused on Commissioner Tate in this merger suggests that at least the parties themselves believe she is undecided,'' said Paul Gallant, an analyst for Stanford Group in Washington and a former FCC official.

FCC spokesman Robert Kenny said the agency doesn't comment on internal discussions.

Tate, 5l, declined to comment outside of an event at the FCC last week. An appointee of President George W. Bush, she arrived at the commission in 2006 from the Tennessee Regulatory Authority, which oversees telephone service and other utilities.

XM spokesman Chance Patterson also declined to comment, and Sirius spokesman Patrick Reilly didn't return a telephone call.

At the FCC, Tate has fought against childhood obesity and broadcast indecency. She is ``a leading voice on issues affecting families and children,'' according to her biography on the FCC's Web site. Tate has said she encourages market-based solutions, with competition ensuring consumer benefits.

How to Balance

``I find myself trying to figure out how to balance the needs of the consumer with the needs of industry,'' Tate said in an April 2006 address in Nashville, Tennessee, to Opastco, an association representing small rural telephone companies. ``It's not always easy.''

The merger needs a majority at the FCC to clear its final legal hurdle. U.S. antitrust officials at the Department of Justice approved it in March, about one year after the companies asked for a regulatory review.

Martin submitted the merger for consideration by the other commissioners without first assuring he has three ``yes'' votes, as is his practice, said two FCC officials last week who spoke on condition of anonymity.

``I'm not at all sure there is a third vote yet,'' Andrew Jay Schwartzman, president of the Washington-based public interest group, the Media Access Project, said in an interview June 18. ``I don't have any sense where Tate is coming from.''

`Tough One'

The FCC faces no deadline for a decision. Martin has said he hopes for a vote by the end of June.

While Tate usually votes with her Republican colleagues, she has sometimes split from Martin and opposed him on two cable regulations late last year.

``She's known to be consumer-oriented, and yet she's a loyal Republican, so it's a tough one for her,'' said Howard Liberman, an attorney at Drinker, Biddle & Reath LLP in Washington. He represents New York-based Primosphere Limited Partnership, a closely held company that has asked the FCC for part of the satellite spectrum now controlled by XM and Sirius.

At a June 6 meeting in her office with broadcasters, Tate appeared ``very conflicted'' about the merger, said Whit Adamson, president of the Tennessee Association of Broadcasters, who attended the discussion.

``She didn't lead us to believe either way'' how she would vote, Adamson said in an interview.

To contact the reporter on this story: Todd Shields in Washington at tshields3@bloomberg.net

Last Updated: June 25, 2008 16:16 EDT