WASHINGTON (AP)  Federal regulators have formally approved the merger of the nation’s only two satellite radio operators in a deal closely watched by Washington and Wall Street.

Approval of Sirius Satellite Radio’s buyout of rival XM Satellite Radio Holdings means that more than 18 million subscribers will be able to receive programming from both services. The buyout’s cost was about $3.5 billion. Executives say it will mean huge cost savings that will lead to the first profits for the relatively nascent industry.

The Federal Communications Commission voted 3 to 2 to approve the buyout. The tie-breaking vote, from a Republican commissioner, Deborah Taylor Tate, came when the companies agreed to pay $19.7 million to the federal Treasury to settle F.C.C. rule violations.

The commission’s chairman, Kevin J. Martin, confirmed the final vote on Friday night.

The long-running regulatory review was closely watched by exasperated investors eager for a resolution as well as satellite radio customers with questions about what effect the merger would have on their service.