I will say that the only real exception to date has been the $650 Million spent on MLB -- and nobody could have seen the assinine deal Sirius entered into with NFL coming. Nobody. It was stupid at the time (and continues to be). By doing it, XM was forced to do something to maintain credibility in the sports arena. As it has worked out, it wasn't a bad deal for XM, but it did up the ante before I had expected it.
Ahhh! You see. Just as i stated several years ago. This one is JUST LIKE everyother subscriber model. The investors drink the Kool-Aid and say things like. Low, Low cost of content is going to produce HUGE, HUGE, HUGE Gross Margins (See my earlier post). Well, at least it starts out that way. But, as we have seen in other subscriber models. The cost of content quickly increases as the cash flow starts flowing in. (Same thing happened with Cable TV and Satellite TV, they used to give the content to the cable companies, but as soon as they have a following, the start charging for the content). You see, you claim that XM had to do something. Well, they really didn't have to, if they had a business plan, they could have simply stuck with their plan. But, now they are years behind CFBE targets, and still burning cash.
So, there really is no magic here. Just another bad subscriber model.
CPGA too BIG/ARPU too small.
And so it goes, |
