Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: DaveMG who wrote (2194)	2/17/2006 1:10:56 PM
From: pcstel	Respond to of 3386

Isn't 1.8% of 10 million 180,000, not 1.8 million? CHURN percentage metrics are monthly based. So for example, 1.5% CHURN rate is 1.5% X 12 months to get an annualized CHURN rate. I am going to check on it but I doubt very much that they count the 54% who activate post free trial as subs before they actually sign up and activate because that would ultimately produce huge churn numbers, not even in the ballpark of the numbers being reported.. Exactly, this has been one of my major criticisms of XM metrics. They count every new trial subscription AS A SUBSCRIBER up front. Yet, if they do not convert this trial subscriber into a self-paying subscriber, they exclude this from the CHURN metrics. So actual Blended CHURN is quite a bit higher than the actual Metric that XM management provides IMO. Your argument depends on 2 factors mainly as I see it. The first you have yet to disclose and that is what is your take on the ultimate number of subs and the rate at which they will continue to accrue. And the second is that costs continue to rise and outflank revenues. Well, I think I attempted to give you a reason why I can't give you an exact number. And that is. The data to assemble this answer is not provided. If you had "hard" CHURN and Subscriber Data. It would be easier to do. My viewpoint is, if you had real CHURN metrics. This stock would be in the single digits. Or if Subscribers were counted only after they became self-pay. This stock would be in the single digits. The way it works now. They count the non self-pays as subscribers, then exclude them from CHURN metrics when they refuse to become self-pay. I have been assuming since the beginning that sat radio will ultimately garner at least 25% of the automotive mkt, so 50 million subs split in some way between SIRI and XM, and that subs will continue to grow by approx 5 million/year, which I think will prove conservative) well into the next decade. The problem is.. In car entertainment is just starting to take off. An example of things to come is Media Flo by Qualcomm. Qualcomm will be broadcasting 20 video channels and dozens of audio channels on Terrestrial Channel 55 UHF Television spectrum. They basically bought a nationwide license at FCC auction a few years back and are in the process of building out the network. They are not limited to restrictions that SDARS spectrum is limited to. For example, they will be able to use 5 Megawatt Transmitters that will only take 2 transmitters to cover a Metropolis. And unlike SDARS, they are not "restriced" from content use. No satellites need to be built, or launched. They can cover the entire US at a fraction of the cost of Satellite.