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Technology Stocks : Sirius Satellite Radio (SIRI) -- Ignore unavailable to you. Want to Upgrade?

To: i-node who wrote (4647)	7/28/2006 12:23:06 PM
From: pcstel	Read Replies (1) \| Respond to of 8420

What do you suppose the total number of SDARS subscribers might be in 2011, assuming (a) both companies are still in business by then, and (b) both companies count subscribers roughly in the same ways they do now? I don't have any metrics to even take a stab at that one. Just take a look at this concept. Let's say that I am close and it takes 1.3 million Gross Adds to add.. or say.. 600,000 nets. At a CPGA of $100, it will cost them 130 million dollars to add 72 million in annualized income. So it will take them 2 years just to recoup their CPGA. And that is optimistic because that would assume that non of the 600,000 in Net Adds doesn't CHURN in the first 2 years. Which current CHURN figures show that 44% (250,000) of those 600,000 will deactive in the first two years. At 10 million, they will need almost 2.2 million NET ADDS or about 4.5 million GROSS ADDS just to cover the 22% annualized CHURN. Those Gross Adds will cost them almost a HALF A BILLION DOLLARS in CPGA expenses per year. Just to remain at ZERO subscriber growth. A half a BILLION here, and a half a BILLION there, and pretty soon, you are talking real money.