The two satellite radio pioneers, Sirius Satellite Radio and XM Satellite Radio Holdings, have received the green light for their long-planned merger. The Federal Communications Commission (F.C.C.) formally approved Sirius to takeover XM which means that about 18 million subscribers will be able to receive programming from both services. Sirius will purchase XM for about $3.5 billion.

Republican commissioner Deborah Taylor Tate had the tie-breaking vote and she gave it in favor of the merger after the two firms agreed to pay $19.7 million to the federal Treasury to settle F.C.C. rule violations. The final vote was confirmed by F.C.C chairman Kevin J. Martin on Friday night.

F.C.C. two Democrats members, Jonathan S. Adelstein and Michael J. Copps, voted against the resolution arguing that it will create a monopoly on that market, a fact which wouldn’t be in the public interest at all. The three Republican members of the commission - Mr. Martin, Ms. Tate and Robert M. McDowell – voted in favor of the takeover.

"The biggest question mark is how this product thrives in an era of difficult financing and where people have alternative means of getting radio," says Blair Levin, former FCC chief of staff, BusinessWeek.com reported.

A merger between Sirius and XM means that the two companies will save costs that normally are passed onto consumers. Thus they will probably be able to turn around their financial state and report profit. However, the satellite radio firms are facing some tough competition coming from their traditional AM/FM radio, internet-based radio stations and programming delivered by MP3 players such as iPods.

Yesterday, while the F.C.C. members were still tied in their vote, Sirius shares went up 30 cents, or 13 percent, to $2.68 at 4 p.m. New York time in Nasdaq Stock Market trading and fell 12 percent this year. XM climbed 94 cents, or 10 percent, to $10.04 and is down 18 percent.