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Thread: Brandon - don't do it - you are wrong !

  1. #1
    sxminvestor is offline

    Brandon - don't do it - you are wrong !

    Wrong on negative sub growth in 2009 - get your facts right first !


    -The overall churn from 19.5 million subs would be about 5.1 million for the year with an all-in-churn of 2.2 %

    - Using 9.1 million with a penetration rate of 55% (Sirius claiming 60% possible in 2009) = 5 million new subs.

    - Let's say on the low side they add 300,000 subs per quarter at retail, that is 1.2 million retail adds. This is a gross figure - lost retail subs in the all-in-churn#.

    19.1 start of 2009 +5 million OEM + 1.2 Milion Retail - 5.1 Million All-In Churn = 20.2 by the end of 2009.


    You cannot take the OEM take rate and then reduce by another 50% when this is already in the All-in-Churn #'s Sirius has been reporting for many quarters. Also, with the Howard Stern effect faded, you also do not have all the XM subs quitting and going to Sirius. In addition, the service has alot more offerings and better price points to keep subs with lower affordabilty. I do not believe that churn will get any worse than it has been in the past or at least the things I mentioned will negate the poor economic conditions that may have some quit the service. And then we have the IPOD app that is coming, which could change everything.

    Brandon -
    you need to think twice before you publish something that may be way, way off base. I think you have your facts screwed up and you seem to always bounce from one extreme to the other with bold statements that are not always backed up with all the most accurate facts. I think your off big on this one and you need to review where you are getting your numbers !
    Last edited by sxminvestor; 03-05-2009 at 02:35 AM.

  2. #2
    bananaz is offline
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    Joined: Jan 2009 Posts: 220
    SXMinvestor, what are you referring to? Is there an article or post?

  3. #3
    sxminvestor is offline
    Quote Originally Posted by bananaz View Post
    SXMinvestor, what are you referring to? Is there an article or post?
    Take a look at the thread 12B-25 EXT

    Quote:
    Originally Posted by Brandon Matthews
    With a 9.1 million oem run rate and 1.7% churn they will lose 2 million subscribers in 2009
    Last edited by sxminvestor; 03-05-2009 at 09:37 AM.

  4. #4
    sxminvestor is offline
    Quote:
    Originally Posted by homer985
    Yes, if you believe that RETAIL adds ZERO subscribers in 2009 - then this is possible.

    20MM subs with a 1.7% churn is 4MM lost subs in 2009;

    9.1MM OEM run rate, with a 50% installation rate and a 50% takeup rate;
    leaves 2.28MM OEM additions in 2009

    Difference is 1.72MM lost subs for 2009. If you believe that RETAIL has ZERO adds in 2009, then you will have your 2 million lost subscribers in 2009.

    However, an average of 500K new retail subs per quarter, would put 2009 totals into the positive.

    Yes, completely disagree with your assessment.


    -----
    Brandon Matthews:
    Apparently Homer, you do not completely disagree. In fact you acknowledge that you concur on nearly every point. I didn't want to see the result that I came up with using the very same methodology. It pained me to pen the article I wrote tonight but it had to be written, which will be published tomorrow.

  5. #5
    sxminvestor is offline
    Well Brandon, did you decide to publish it ?

    I don't see it yet.

    Loss of 2 million subs in 2009 - I don't think so.

  6. #6
    homer985 is offline
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    Joined: Mar 2008 Posts: 485
    sxminvestor -- I can't argue with your numbers. Obviously with a slightly increasing monthly subscriber base, the churn would be a little higher. But that wouldn't be too significant.

    I know I was calculating things differently using gross figures and the self-pay churn, but the figures are similiar in the end.

    I do believe that your retail gross additions for 2009 were very conservative. I believe that the gross for 2008 was in the neighborhood of 2MM, so your drop to 1.2MM is a 40% drop. Conservative, likely leaving upside potential.


    --------

  7. #7
    sxminvestor is offline
    Quote Originally Posted by homer985 View Post
    sxminvestor -- I can't argue with your numbers. Obviously with a slightly increasing monthly subscriber base, the churn would be a little higher. But that wouldn't be too significant.

    I know I was calculating things differently using gross figures and the self-pay churn, but the figures are similiar in the end.

    I do believe that your retail gross additions for 2009 were very conservative. I believe that the gross for 2008 was in the neighborhood of 2MM, so your drop to 1.2MM is a 40% drop. Conservative, likely leaving upside potential.


    --------
    Yes I was being ultra conservative to not appear to be pumping. I was really upset to hear that Brandon was planning on publishing something so negative when I believe he is way off base. Don't we have enough crap being put out there by ignorant bloggers.

  8. #8
    winagain35 is offline
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    I also think that the 9.1mil OEM number is quite pessimistic. If there is even a little bit of a turnaround in the economy I think we easily hit 10mil. Cars will need to be replaced.

  9. #9
    sxminvestor is offline
    Quote Originally Posted by winagain35 View Post
    I also think that the 9.1mil OEM number is quite pessimistic. If there is even a little bit of a turnaround in the economy I think we easily hit 10mil. Cars will need to be replaced.

    I agree, right now the rate on old cars being junked is in the 12 -14 million per year, so demand will be coming soon. It's better for Sirius if GM is the one floundering, because the stronger Ford is, the more favorable it is to Sirus bottom line.

    Also, check out the piece Orbitcast has just done on Sirius' internet strategy - looks extremely promising !

    This while Brandon looks to drop a negative misguided bomb.

  10. #10
    john is offline
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    Joined: May 2008 Posts: 2,836
    Something I also would like to remind you is that, first there are a hell of alot used cars out there that have deactivated satellite radios in them. That while the new car sales have decreased the used car sales have picked up. Second the reason retail dropped off so much was almost all due to the fact the penitration rates went up in OEMs (also the Stern effect). Meaning you dont buy a satellite radio at retail to put one in your car if you already have one in your car (in general even if the one in your car sucks).

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