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  1. FoolNHisMoney is offline
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    03-08-2009, 10:01 PM #341
    Quote Originally Posted by Brandon Matthews View Post
    John.

    Here's what you are missing. You are counting retail for 2008. The article stated that management was in the process of conducting a viability study of whether or not the future prospects would reasonably make it a going concern.

    The suppositions I made were relative to 2009. I considered the oem outlook, the recession and skyrocketing unemployment. Q4 2008 has no bearing on the future of the company. Q1 however does. And Q1 is bad for all companies.

    Regarding your second problem. First comes gross additions, which would increase the sub base. Gross additions minus deactivated customers = NET subscribers, which is your final subscriber number. They will hit 21 million on gross, but its the net that is the issue.
    Brandon, I'm really not trying to beat that dead horse here . . . well really I am . . . but I will make one last attempt to point out why your math is wrong. This is what you state in the article:

    9.1 million auto sold times 50% penetration rate = 4,550,000 new installations.

    4,550,000 new installations times 50% [take rate] <- my edit (currently running below that) = 2,275,000 new oem subscribers.

    21,000,000 subscribers times 1.7% monthly churn = 4,284,000 deactivated subscribers. <--- We've pointed out ad naseum your error here r.e. using self-paying subs to calculate churn vs. gross subs, using EOY gross vs average monthly gross, etc. Next, you already included OEM losses in the above when you calculated the 2,275,000 number. You are in essence double counting the OEM churn in your calculation when you calculate churn from the gross after already applying the take rate!

    4,284,000 - 2,275,000 = 2,009,000 subscribers to be lost in 2009

    Here's what you should have said using your own thought logic:

    OEM gross adds = 9,100,000 x 50% = 4,550,000

    OEM deactivation = 4,550,000 x 50% = 2,275,000 (these are trial sub deacts, not self-pay deacts)

    15,000,000 (average monthly self-pay subs starting at 19 mil gross subs after Q4 and EOY 17 mil assuming 2 mil net decrease) x 1.7% churn = 3,060,000 deactivated self-pay subs.

    4,550,000 - 2,275,000 - 3,060,000 = 785,000 subs to be lost in 2009

    Your number is off by at least 1.224 million not even getting into the issue of retail subs. That is fact, not opinion. Note that 21 million never enters into the math (I'm assuming you got this number from 19 mil current + 3 mil average gross OEM adds for the year).

    You could have posted the article stating "700,000 net lost subscriptions" and had the same effect while having a leg to stand on.

    Lastly, retail subs are NOT negligible. Since you've already included the retail loss in the churn (which is about 50% of churn), every new retail sale is essentially a NET SELF-PAY ADD! Gross retail sales have historically been 1,000,000+ (rough low estimate here). The number may come down given the current economic conditions, but hardly something you should dismiss as neglgible . . . how much do you think retail will decrease? Auto sales are considered a disaster at 40% down. I find it hard to think SATRAD sales will decline more than auto (or any other industry). There's considerable merit to the argument that cheap entertainment services will actually increase sales in a poor economic environment. Look at Netflix for example. Assuming a drastic 50% decline you are calling some 500,000+ net self-pay adds negligible.

  2. KingFreep is offline
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    03-09-2009, 12:24 AM #342
    Brandon et al: Why hasn't SIRI done something about the MILLIONS of cars on the road that have Sirius or XM receivers in the car, but not activated? Why not create a menu of free channels that have ads (for revenue) and turn on every inactive receiver in the country with those channels to give people a taste? Even if it's just for a few months. My own example...I've owned SIRI stock for several years now, yet I only recently started actually listening to the service. (disclosure: 95,000 shares at avg price of 71 cents.) I recently bought a used car that had a receiver and I activated it. Now, it's all I listen to in my car. It's a great service...and to be honest I'd give up cable TV before I gave up my SIRI subscription. New car sales aren't the only way to get new subscribers. I'm proof. Just a thought.

    FYI...now is a perfect time to buy a great used car. Mine is a 2006 Jaguar XJ8 with 12,000 miles that I got for a song. What a car. Best I ever owned.

  3. Wirestripper is offline
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    03-09-2009, 01:03 AM #343
    Quote Originally Posted by KingFreep View Post
    Brandon et al: Why hasn't SIRI done something about the MILLIONS of cars on the road that have Sirius or XM receivers in the car, but not activated? Why not create a menu of free channels that have ads (for revenue) and turn on every inactive receiver in the country with those channels to give people a taste? Even if it's just for a few months. My own example...I've owned SIRI stock for several years now, yet I only recently started actually listening to the service. (disclosure: 95,000 shares at avg price of 71 cents.) I recently bought a used car that had a receiver and I activated it. Now, it's all I listen to in my car. It's a great service...and to be honest I'd give up cable TV before I gave up my SIRI subscription. New car sales aren't the only way to get new subscribers. I'm proof. Just a thought.

    FYI...now is a perfect time to buy a great used car. Mine is a 2006 Jaguar XJ8 with 12,000 miles that I got for a song. What a car. Best I ever owned.

    I drove a cople XJ's in my time. One was a yellow XJS convertible. I still remember those 12 cylinders pushing me back into the seat when I put my foot in it. Whata feeling!

    As to SIRI, everyone who try's the service loves it. The few who cancel don't use it or don't like radio and prefer cd's.

    I don't know if they have a listing of all the owners of their equipment. I also don't know if they do promotions using that list or anything like you suggested but it sounds like a idea that the marketing guys should be looking at.

  4. billhart22 is offline
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    03-09-2009, 01:14 AM #344
    Quote Originally Posted by Wirestripper View Post
    I drove a cople XJ's in my time. One was a yellow XJS convertible. I still remember those 12 cylinders pushing me back into the seat when I put my foot in it. Whata feeling!

    As to SIRI, everyone who try's the service loves it. The few who cancel don't use it or don't like radio and prefer cd's.

    I don't know if they have a listing of all the owners of their equipment. I also don't know if they do promotions using that list or anything like you suggested but it sounds like a idea that the marketing guys should be looking at.
    I don't care about the rest of the post, but I believe in your signature! Right On!

  5. Newman is offline
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    03-09-2009, 03:18 AM #345
    I believe that the image that everyone is looking for is here...


  6. Paratrooper_Rick is offline
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    03-09-2009, 03:21 AM #346
    Thanks for the last laugh of the day Newman - As usual - it appears we few are roaming the halls.....

    Isn't it about time to start the next intraday thread.......

  7. Newman is offline
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    03-09-2009, 03:28 AM #347
    But of course.... you will have it momentarily.

  8. relmor2003 is offline
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    03-09-2009, 11:24 AM #348
    Quote Originally Posted by Newman View Post
    I believe that the image that everyone is looking for is here...

    Nice. I like that one, thats funny. Looks a girl fight!!!

    Id like to offically kill this thread and move on to other issues, if we can.
    LOL

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