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Sirius Shares Fall 7% On Lower Subs Forecast(Sirius/XM merger?)
Radioandrecords.com ^ | Dec. 05, 2006 | Jeffrey Yorke

Posted on 12/05/2006 4:06:58 PM PST by MovementConservative

Shares of Sirius Satellite Radio fell more than 7%, or 30 cents, to $3.89 a share in the first 30 minutes of trading Tuesday morning (Dec. 5) after the satcaster cut its year-end subscriber forecast by 200,000 to 6.1 million. Shares of SIRI hit a low of $3.75 at 9:48 a.m. before beginning a slight rebound.

After the stock market closed Monday evening (Dec. 4), Sirius CEO Mel Karmazin issued a statement noting that sales of satellite receivers since the Thanksgiving weekend “have not been at the pace we had anticipated. We are updating our year-end 2006 subscriber guidance to between 5.9 million and 6.1 million.”

The move by Sirius reverberated on Wall Street as analysts began slashing their ratings on the satcaster, sparking a new wave of predictions that Sirius would have to merge with its rival, XM Satellite Radio, to survive.

“I have to tell you, I thought that without a merger with XM, these two companies might not create a lot of wealth in the next few years,” wrote Wall Street gadfly Jim Cramer in his RealMoney.com column posted this morning on TheStreet.com. “Mel convinced me I was wrong," he continued. “I wasn't. I blew it. I should have stuck to my guns. I feel embarrassed. And I don't like it,” bemoaned Cramer, who also hosts CNBC’s “Mad Money.” “Mel had been money in the bank. Everyone deserves one strike. But in my league, two strikes and you're out.

“Even a half-strike more and you're out in this satellite game,” Cramer continued. ”If Mel hits the low end of the range or doesn't hit it at all -- both entirely possible if sales don't pick up in the next two weeks -- this one's done for, without a merger.”

Bear Stearns satellite analyst Robert Peck cut his rating on Sirius to underperform, noting a weak retail environment and the fact that Sirius is losing ground to XM in the race to have new car manufacturers insert its receivers in new cars. Morgan Joseph’s David Kestenbaum, meanwhile, slashed his rating on Sirius to hold.


TOPICS: Business/Economy; Extended News
KEYWORDS: jimnorden; moonachie; nortonandfriends

1 posted on 12/05/2006 4:07:02 PM PST by MovementConservative
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To: MovementConservative

So how much did Howard Stern lose? LOL!


2 posted on 12/05/2006 4:08:21 PM PST by TommyDale (Iran President Ahmadinejad is shorter than Tom Daschle!)
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To: MovementConservative

XM and Opie and Anthony are better anyway.

See ya Howie.


3 posted on 12/05/2006 4:08:58 PM PST by VegasCowboy ("...he wore his gun outside his pants, for all the honest world to feel.")
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To: MovementConservative

Would the Feds allow a merger?


4 posted on 12/05/2006 4:09:34 PM PST by ivyleaguebrat
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To: MovementConservative
...after the satcaster cut its year-end subscriber forecast by 200,000 to 6.1 million.

I was probably one of the 200,000. My car came with the Sirius radio and a free year's service. Never used it. Despite repeated phone calls, emails and letters from them, I won't be renewing

5 posted on 12/05/2006 4:10:56 PM PST by Vermonter
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To: TommyDale
So how much did Howard Stern lose? LOL!

If he were smart, he would have sold the stock the second he got it. This chart tracking the stock for the last six months speaks volumes.

Photobucket - Video and Image Hosting

6 posted on 12/05/2006 4:18:33 PM PST by MovementConservative (Getting back to principled conservatism.)
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To: VegasCowboy
See ya Howie.

I guess we'll see him soon, shuffling the streets, mumbling profanity and exposing himself to passersby.

In other words, the only change is he'll be outside.

7 posted on 12/05/2006 4:20:01 PM PST by atomicpossum (Replies must follow approved guidelines or you will be kill-filed without appeal.)
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To: MovementConservative

Stern and Karmazin will raid the company for whatever money it has left before chapter 11, and leave shareholders holding the bag.


8 posted on 12/05/2006 4:20:29 PM PST by Proud_USA_Republican (We're going to take things away from you on behalf of the common good. - Hillary Clinton)
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To: ivyleaguebrat

Not sure they'd care. What's 100 percent of a peanut market ?


9 posted on 12/05/2006 4:24:57 PM PST by Eric in the Ozarks (BTUs are my Beat.)
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To: TommyDale
After all Stern's pontificating that all the world would follow him to satellite radio. IMHO his demographics would never spend the money for satellite radio.
10 posted on 12/05/2006 4:26:22 PM PST by Conservative4Ever
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To: Conservative4Ever

The only reason they talk merger is to keep the stock up while they sell all their insider shares.


11 posted on 12/05/2006 4:27:01 PM PST by BurbankKarl
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To: Conservative4Ever

Why would anyone spend money to listen to radio?


12 posted on 12/05/2006 4:29:25 PM PST by rivercat (The first thing we do, let's kill all the lawyers. - William Shakespeare)
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To: MovementConservative
This could be Sirius, but not Hughes.


13 posted on 12/05/2006 4:30:21 PM PST by Larry Lucido
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To: dcam

do you spend money to watch TV?


14 posted on 12/05/2006 4:32:26 PM PST by BurbankKarl
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To: dcam

We've been over this in detail. People who live in rural areas or travel a lot find satellite invaluable.


15 posted on 12/05/2006 4:33:41 PM PST by MovementConservative (Getting back to principled conservatism.)
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To: MovementConservative

Sounds like the Quadrasonic versus 8-Track battle from the 1970s. Not quite the same, as they were 2 different technologies, but you know what I mean. Okay, I'm wrong, but I'm going to hit "Post" anyway.


16 posted on 12/05/2006 4:34:43 PM PST by Azzurri
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To: TommyDale
So how much did Howard Stern lose? LOL!

Yeah, he's down to his last 150 million. What a drag!

17 posted on 12/05/2006 4:35:54 PM PST by wireman
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To: MovementConservative
Sirius is losing ground to XM in the race to have new car manufacturers insert its receivers in new cars.

Ultimately, sustained business must originate from receivers in new cars, as it is passive. If new cars came with no radios at all, and you had to go aftermarket to install one, only a minority of people might go out and get radio's installed.

Right now, Sirius = Stern, and I'll bet a lot of new car makers don't want baggage like that.

18 posted on 12/05/2006 4:36:08 PM PST by Plutarch
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To: MovementConservative

I like Sirius. Good selection but it didn't take long to notice they looped their music way too often.

All they had to do was change up their selection way more often on my favorite channels and I'd still be there.


19 posted on 12/05/2006 4:37:35 PM PST by VeniVidiVici (What's the one elected position Ted Kennedy has never held? Designated Driver.)
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To: MovementConservative

This is series.


20 posted on 12/05/2006 4:38:05 PM PST by Paleo Conservative (Karl Rove isn't magnificent.)
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To: Larry Lucido
It's not?


21 posted on 12/05/2006 4:39:52 PM PST by Paleo Conservative (Karl Rove isn't magnificent.)
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To: VeniVidiVici

Sirius has an excellent selection of programming, and still has momentum even with this temporary blip. Two years ago, people would say, Sirius WHO? Not anymore. My money is on Sirius, figuratively and literally (for the long term as a stockholder). Time will tell in another few years how this all shakes out. Meanwhile, every store I've been to electronics wise has tons of XM equipment, but very little if any Sirius equipment (which is an indicator of its much higher demand over its rival).


22 posted on 12/05/2006 4:51:35 PM PST by John Frum
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To: John Frum
My money is on Sirius, figuratively and literally...

I'm afraid Howard and Mel have your $ now. Sirius stock may not be worth the paper it's written on after the holidays. If they aren't able to get in the new car market, stick a fork in that company and kiss your investment goodbye.

23 posted on 12/05/2006 4:56:59 PM PST by MovementConservative (Getting back to principled conservatism.)
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To: VegasCowboy
XM and Opie and Anthony are better anyway.

Roger that. I have a long commute and even though I get NYC radio most of the time, it's aweful and constant commercials. I really enjoy Lucy/Squizz/Top Tracks/80s and of course, the virus. Heavy traffic doesn't suck as bad as it used to :).

24 posted on 12/05/2006 5:02:57 PM PST by Malsua
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To: Vermonter
"I was probably one of the 200,000. My car came with the Sirius radio and a free year's service. Never used it"

I use mine all the time as it has some of the BEST Conservative talk shows that I cannot get on local stations. Plus old time radio drama and many, many great country music options.

You should have turned it on it was free!
25 posted on 12/05/2006 5:06:22 PM PST by YOUGOTIT
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To: Malsua
but it didn't take long to notice they looped their music way too often.

Some are worse than others - the play list on "Pure Jazz" seems to less than 100 tunes deep - I mean, HOW HARD could it be to add another 500?

26 posted on 12/05/2006 5:10:20 PM PST by M. Dodge Thomas
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To: YOUGOTIT

I never really had the time to get used to it. My trips are usually short and I like to catch the local news. By the time I figure out what I want to listen to on Sirius, I've arrived where I'm going. Glad it works out for you


27 posted on 12/05/2006 5:17:34 PM PST by Vermonter
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To: MovementConservative
Oh Yeah! Well take this: Compare with XMSR

Both dicey of course.

28 posted on 12/05/2006 5:48:37 PM PST by GregoryFul (There's no truth in the New York Times)
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To: dcam

To avoid the annoying ads?


29 posted on 12/05/2006 5:49:30 PM PST by GregoryFul (There's no truth in the New York Times)
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To: John Frum
"Meanwhile, every store I've been to electronics wise has tons of XM equipment, but very little if any Sirius equipment (which is an indicator of its much higher demand over its rival)."

Uh, hold on there... unlike the satellite boom of the past few years, retailers have wised up and heavily stock the units that SELL. I'll admit that I am an XM subscriber for the past 3+ years, and can attest that XM's hardware is vastly superior to those carrying Sirius' label.

Mel can pontificate all he wants of his product, but when he spends it on an air bag named Stern, he needs to clean the slime off of his crystal ball.

30 posted on 12/05/2006 5:51:11 PM PST by AJ504
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To: ivyleaguebrat
Would the Feds allow a merger?

Only if they're truly convinced that one or both companies was utterly doomed to go under without it (and neither company is anywhere close to that point, despite the wolf cries of this article). They smacked down the proposed Dish Network - DirecTV merger in record time.

31 posted on 12/05/2006 5:57:51 PM PST by Dont Mention the War (Giuliani '08: Why not p. o. BOTH sides?)
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To: MovementConservative
As a traveling sales rep, I love my Sirius radio. I travel some pretty rural areas where at times when you could not pick up anything except some color gospel station. I like to listen to talk radio, but I got tired that my only choices it seemed on regular radio was Rush at noon with Sean following. The only time I listen to regular radio is when I am in a market that plays Neal Boortz.
32 posted on 12/05/2006 6:01:37 PM PST by hodaka
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To: MovementConservative
Image hosted by Photobucket.com XM came with the car...

they have an all Traditional/Clasic Christmas Carrol program on 107 and 108 is all "Grandma was run over by a reindeer" kind of songs.

33 posted on 12/05/2006 6:07:13 PM PST by Chode (American Hedonist )
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To: MovementConservative

This is one of those rare reversals of the old BetaMax versus VHS issue. In this case, the superior technology... XM's stationary satellites and more extensive repeater network... is apparently winning.

Nobody's forced to use satellites to listen to radio, and the free broadcasting competition will keep prices down, so having just one supplier probably won't make much difference.


34 posted on 12/05/2006 6:15:10 PM PST by ArmstedFragg
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To: ArmstedFragg
XM's stationary satellites and more extensive repeater network... is apparently winning.

The better programming helps too.

35 posted on 12/05/2006 6:20:13 PM PST by eddie willers
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To: Malsua

Are Bob and Tom on satellite radio?


36 posted on 12/05/2006 7:41:33 PM PST by Ken H
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To: MovementConservative; All

just a tidbit of info here...I read an article in Wired magazine and although I forget WHICH of the two satelite radio stations it was, actually went out of their way to HIRE the effing moron who KILLED FM radio programming (in the late 70's) to do the programming on satelite radio.
Go figure.


37 posted on 12/05/2006 9:22:19 PM PST by taxed2death (A few billion here, a few trillion there...we're all friends right?)
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To: AJ504
The only reason why you claim "and can attest that XM's hardware is vastly superior to those carrying Sirius' label" is because XM had a greater diversity of hardware out before Sirius did... But now Sirius is catching up... Look in any electronics magazine (Crutchfield) and you'll see a preponderance of their (Sirius') products now.

As for programming content, Oprah Winfrey on XM is most certainly NOT going to lift their ratings as much as Howard Stern on Sirius will. You don't have to like Howard Stern, to recognize that his fan base will still continue to migrate over to satellite. Its only been approximately 1 year since Howard started on Sirius; from a programming standpoint (whether you like the particulars or not) its too early to say who's on top. In approximately 24-30 months this question will be answered.

As for "having units to stock and for sale", you could go into any Fry's Electronics store, or Best Buy, or equivalent electronics resaler at the beginning of this year and find absolutely NO sirius products available, yet XM's were all sitting around fully stocked (and unbought). Of course that was a temporary blip due to the run on Sirius products when the subscriber base ramped up. But come this holiday season, you'll probably see an equal number of both products on the shelves now since the OEMs have caught up with demand.
38 posted on 12/05/2006 10:44:46 PM PST by John Frum
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To: GregoryFul
CB Radio had no adds and Satellite radio is on the same path as the CB.
39 posted on 12/05/2006 10:47:44 PM PST by trumandogz (Rudy G 2008: The "G" Stands For Gun Grabbing & Gay Lovin.)
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To: AJ504

"I'll admit that I am an XM subscriber for the past 3+ years, and can attest that XM's hardware is vastly superior to those carrying Sirius' label."

An anecdotal story I have to refute this is claim comes from a co-worker of mine who bought an XM radio receiver for his car, and the unit was constantly picking up transient noise as well as constantly cycling from the alternator in his car. He was an electrical engineer, and eventually he gave the unit away as it could not be fixed.

He did buy another XM radio receiver from a different manufacturer thought which did not have this problem.

My Sirius installation in my vehicle was seamless and without incident. I detect no external noise, no transients and no 'hiss' (as would be the case if I was to turn up the volume to its fullest position on a system with appreciable additional noise).


40 posted on 12/06/2006 10:21:27 AM PST by John Frum
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To: dcam

In my case I work in a very rural area and can't even bring in a 50,000 watt radio station. For me to get news, music and talk radio...XM was the answer for me. The price is worth it to me.


41 posted on 12/06/2006 12:53:34 PM PST by Conservative4Ever
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To: BurbankKarl
do you spend money to watch TV?
---


Yep, and broadcast TV still has a WAY bigger audience than any pay service.
Anyway, radio is not something people tend to listen to unless they are in their automobiles and sometimes at work.
I would never pay for something which is not that big a factor in my life.
Even if you commute 2 hours a day, it's not worth it, imo.
TV on the other hand plays a bigger part of most people's lives. Especially with sporting events etc. People are willing to pay for it.
However, pay radio will never be popular or profitable...sorry.
42 posted on 12/08/2006 5:31:33 AM PST by snarkytart
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