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Technology Stocks : XM Satellite Radio Holdings Inc. (XMSR)
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To: i-node who wrote (3281)2/26/2007 12:24:36 AM
From: pcstel   of 3386
 
LOL. They have paid out whatever it is, 350M is fine, yet they have managed to lose nearly a billion dollars MORE in the last two years since Stern was hired than anyone projected immediately before his hire.


Of course, but no one projected immediately before his hire that SIRI would add 4.5 million net adds in the same time period.. Remember, these are popsicle stands.. The more subscribers you add, the more money you lose.. In effect.. each new customer is a money losing proposition.

Like the SEC statements show.. XM reported 1.5Billion in losses to grow from ~600,000 subs to 5.1 million. Whereas SIRI has reported losses of ~ 2Billion for the same growth, but in a different time period. So you take XM's number and add in that 350 million paid to Stern.. And the costs are not that far off.

Heck, at the time of XM's growth spurt.. You claimed that all of those losses at XM were "totally anticipated", and normal. And that they should be apportioned as "brand building" expenses..

But, when SIRI has the similar level of expenses to grow to/from the same growth points. You seem outraged at the concept.

Like it or not.. This deal would have never happened if Sirius hadn't negotiated "The Stern Deal". Then monitized the increase in market cap. to buy/merge with XM..

You can be sure the news will not be good tomorrow.. Or your XM management would have wanted to wait until AFTER the CC if they thought it would be benefical to the XM shareholders with a higher stock price to deal from.

At this point, look for Sirius to support XM's share price.

PCSTEL
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