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Technology Stocks : Sirius Satellite Radio (SIRI)
SIRI 21.78+1.6%Jan 9 9:30 AM EST
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To: Michael Hart who wrote (1148)12/3/2004 12:09:17 PM
From: TheAlaskan  Read Replies (1) of 8420
 
SAC

SIRI subscriber acquisition cost is higher than XM, but is expected to drop under $200.

XMSR is lower in published SAC. However, each company figures their SAC slightly different.

For example, XMSR pays GM a fee for every XM radio that is factory installed. XM also gives a free subscription to GM for the trial period. XM counts these free subs in their sub count, but they do not produce revenue.

XMSR churn rate is higher than Sirius. However, satrad has high utility and therefore has a low overall churn rate. Most that subscribe, like it. The Sirius demographics of a typical subscriber is 29-45 male and has a household income of over $75,000 a year. The take rate (as it is being called) is substantially higher in the higher end vehicles...BMW, Mercedes, Volvo that target the Sirius consumer than in the lower end GM models equipped with XM.

XM/GM have a lot of "subs" that drop after their free period ends, but they do not release the data in a clear manner. If Sirius included its "free" subs, it would include the 10.5 millions DISH subscribers in its sub count who recieve a select assortment of Sirius music streams over their DISH system.

My point is that each company counts its subs and subscriber acquisition costs differently. I would have hoped that analysts would have drilled each company harder on this point so that subs and sacs can be compared more easily between the two companies.
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