Thursday, June 17, 2004

Sirius Survives... Just

Sirius stock survives a critical report yesterday morning from Wachovia Securities.
The Wall Street firm predicts Sirius will have to raise additional capital by 2006 and says it's "unlikely" to hit its goal of free cash flow breakeven - with 2 million subscribers - by the end of 2005. But the Sirius stock price withstands the bad news.

In the meantime XM Radio has already passed the 2 million mark. Interesting to see that in Silicon Valley, at least, Sirius seems to have a higher profile. I thought some of their packaging was misleading though. There is a 99 dollar home radio in the special offer bin at Frys, one of the California's leading electronics outlets. But the box says only in very small print that you will need a holder and dish, not included in the price. I guess some people were disappointed on Father's Day.

2 comments:

Anonymous said...

Actually they just might. They lowered the price to 9.95 USD if you pay it for a year up front. They sound a lot better with spoken word stuff then XM.

John Figliozzi said...

This seems to be setting up somewhat like the situation that characterized VCR formats some years ago. In that case, Sony's Betamax was generally considered technically superior, yet VHS became the market winner. In this one, Sirius appears to have the superior technology and service (higher angle of satellite reduces dropouts and need for terrestrial repeaters; program offerings are more dynamic, diverse); yet XM (largely by getting to market first and more aggressive marketing) has gained the majority share (by far) of subscribers. One overriding question perhaps will be: Can two such services survive, let alone prosper.

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