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Technology Stocks : XM Satellite Radio Holdings Inc. (XMSR) -- Ignore unavailable to you. Want to Upgrade?

To: verdad who wrote (336)	11/18/2002 6:21:50 PM
From: i-node	Read Replies (1) \| Respond to of 3386

In a cash constrained economy where people will be forced to focus more on necessity items, is XMSR still going to be able to create a new, profitable luxury type service? Yes, of course. In each of the last five quarters since the company opened for business, they have made or exceeded their subscription projections -- for most of this period, radios were unavailable EXCEPT as an aftermarket item. XM's projections have been more on target than any company startup I've ever witnessed. They're projecting 350K by the end of this quarter. This sounds totally reasonable, since they have a pretty good idea how many factory installs to expect. Further, the Delphi unit is clearly a huge improvement over the Pioneer and Sony units, and provides a reasonable means of bringing the service into the home or business. If XMSR could easily obtain the required financing as suggested, then why must XMSR wait until 2003, 2004 to prove the viability of their 'cash cow' business? I'm not sure what you mean. The viability is pretty clear -- at something under 3M subscriptions is breaks even for cash flow purposes, and at 4M it breaks even for income purposes. My hope has been that they'll be able to fund the next year or so through debt and not by further dilution, since the price of the stock is so low. However, everyone who owns this stock today should be anticipating further dilution, as the company has been clear: They need another $600M to reach break even. I have no comment on the Morgan Stanley question, as I don't know how it is relevent to what is going on. XM is executing perfectly according to its plan, and the ONLY deviation is that SIRI has failed to gain any traction whatsoever, which can only be a good thing. I only wish I had more money to buy XM stock with.