Sirius XM Now Need To Execute
With the debt issue behind them for 2009, it is time for Sirius XM to begin to execute on the business plan and show that their efforts make this company not only viable, but valuable. Yes, OEM sales are still painfully low, but management needs to demonstrate that merger synergies and their business model can weather the storm. Investors need to see that costs are improving, that the brand is growing, and that satellite radio will prosper even when the auto industry is in a slump.
People are tired of waiting for all of the stars to align for this equity to return to the days of 2004 and 2005. People are tired of reliance on outside parties such as GM and Ford having such a tremendous impact to the downside. In this economy people are looking for an equity that can stand on its own feet. With everyone suffering heavy losses in their portfolios, people are tentative when it comes to risk, and like it or not, there is risk in Sirius XM Radio. Until the company can outline a plan, and demonstrate that they are hitting each goal, the perception of risk will not minimize.
Satellite radio can be a cash cow, but they have yet to prove it. This is where the tenor of the company needs to come into sharp focus. This is why clear cut goals need to be established and reached for both short and long term. Investors love to hear about next year, but they are nervous now, and need some milestones for next quarter. Conference calls need to be as soon as possible, not at the last minute. If auto companies can put out numbers within a month of the quarters close, satellite radio should as well.
With this equity, everything seems to be an uncertainty. The company has the ability to remove the guesswork by simply giving the street something ti hang their hat on. Q1 ends on March 31st, then have the call by April 30th, and continue that process. The longer the street has to guess, the more risk the street associates with the equity.
There is one satellite radio company. Establish the goals, march in time, and give the investors something to know they can count on. Even if the picture is not pretty, goals and objectives can be established.
Position – Long Sirius XM Radio
Good article, but we shouldn’t have to wait until April 30 to see 1st Q results. This business is relatively simple — they should be able to report by the 15th, no later than 22nd of the month following quarter end.
I do, howver, understand the delay this time – they needed to resolve the financing issues before issuing the 10K to avoid the going concern comment. There shouldn’t be that excuse going forward.
Tyler, As I have posted several times in the past. Gotta get to the younger crowd via internet, portable players, cell phones etc. The image of the company is vague @ best. They need different marketing packages for the different genres of music & other content. Yes, I realize that had other issues such as merger & finance. But I hope they can concentrate on being more progressive. They need to listen to their patrons needs too! No matter what other new tech. comes down the pike (and they are coming) content is your life insurance policy! ALSO,I’m still wondering if there is any talk of using the Sats. for worldwide use. When they are orbiting earth there is of course idle time always going on when they aren’t capable to broacast to the US or Canada. Is anything u know of happening to utilize this time & space. Seems like these Sats. r not being used anywhere near there potential. Could u bring us up to speed on this issue? Thanks!(i know 1st things 1st but these seems to have endless potential).
The sats are in geosynchronous orbit, meaning they sit at a fixed location above the Earth as the planet rotates. The sats are always beaming down to North America only so there is no “down time” where they would be able to reach other parts of the world.
This is incorrect. XM satellites are in a true geosynchronous orbit, Sirius uses a ‘HEO’ or highly elliptical orbit. That means that Sirius’ satellites move about the sky relative to a fixed position. It is also why Sirius must keep three satellites in operation at one time – at some times one or two of the satellites is not over the United States. Therefore the OP’s comment about there being the potential to lease unused bandwidth when the sat is not viewable from the US is accurate.
put international music stations and comercials on, america is iternational. this way they can make money both ways
They need a new, youth friendly commercial campaign. Hes what I have envisioned.
Young celebrities, one has an iphone, the other a portable sat radio device. Define the product by direct comparison, make it funny, and sexy, and show the people why its superior. Above poster is right, no one should have to guess as to their image, and product. Its a content delivery system company, not a satellite radio company anymore. Sell the genres, downloading abilities unique programming, now available anywhere you go. And sign young talent, a Hanna Montana Hour, Spongebob channel, something for teenages, I dont care. Maybe even a comic channel that does nothign but talk comics. Or a hobby channel that touches on many hobbies, skating, gaming, platform gamer chat, help lines, etc…
Move with the times.
They need a celebrity image association for this campaign, not oprah or howard, someone like Hanna Montana, or whoever. When someone sees this celebrity they should think of SiriusXM. In the 80’s when we saw Pepsi, some thought of Michael Jackson for a while, etc…
This is basic marketing 101. If they cant figure this out in time, I dont know what to tell them. Then they arent really trying, and they should hire me immediately.
interesting thoughts relmor……….hope the brass really does bother having at the very least, their pions read the stuff on these sites……..!!!
Relmor, U R on the money! Got any knowledge on my Sat.usage question?
IMHO…this article is ill-timed and a !glorious! exercise in stating the obvious. Tyler…thank god you’re here! Do you go by Capt. or Mr. Obvious? I just don’t know if SIRI would have survived if not for your keen insight and direction. Tyler, I would get real ugly on your right here if not for my respect for this site. But my question to you and every other impatient MSM writer, opionater, and spin maven is: Why can’t this company be allowed to prove their new mission without people like you and et al, demanding they do this, that, and the other thing, non-stop, day in, day out, on your requests and on the dime (otherwise they fail as a company..which is my inference of your implication here)? Sorry, but esp. in this, a near economic depression they just don’t deserve this continual skeptic, naysayer, perform-tricks-for-me driven noise. But you go ahead Tyler..and Brandon (the great pontificators of everything SiriusXM!). Go ahead, keep the pressure on. Keep your foot on the neck of this company. I guess you guys would be out of a job if you didn’t do it huh?? So enjoy. Keep it up sirs. I will always be around to provide a DIFFERENT opinion.
sl62….
with all due respect, look at how many articles I have published in the last month. If what I state is so obvious, then why is nothing done? the fact of the matter is that the company should take steps to remove all of the uncertainty, or at least the uncertainty that they have control over.
This equity is hammerd by the economy, as well as perception. They got the financing done, and that is great. Now it is time to show the world what satellite radio is capable of.
I find it odd that I get accused of “pumping” and “bashing” at the same time!
Tyler…
First…maybe I was a bit harsh. As you know, there has been a lot of drama going on over the last week. Mostly I have always found you to be pretty fair (which I think you know from SA) so nothing against you. My point here is it just seems rather obvious to me what the next steps are…and further I don’t doubt for a minute Mel and Co. know exactly those steps. I don’t think their idea of running a business boasting nearly $3B in revenues and 20M subscribers, is to kill it by not advertising or exploiting all business channels available (but in the appropriate timeframe as to suit all angles of reality). I don’t know how easy you think it just was right here to come up with $1B in new financing logistics, but then again I do think you know that answer. As investors, consumers and just people of this country, we have been learning everyday now since Sept 16th (ish) when Lehman went down, just how badly our economy appears to be broken (which was not known in the beginning). All this time we have not been assuming the worst and have just been telling Mel and Co. to “c’mon, hurry up, what’s the hold up…” Well, for those with their eyes open everyday and pulsing this thing, we now see how difficult it really has been and what it actually took for him to get this refi done. He had to give 40% of the company away as a carrot, nothing less would have done. That at least to me, speaks volumes as to how tough things really are (as if we even needed that proof by now). And I applaud Mel and BOD’s for seeing that reality rather than saying “no way” and taking their ball and going home. But I also believe in this outcome because of who the counterparty was to that 40%..it actually works in the favor of the company because of potential future upside suprises in synergy or even just through the new association–it never hurts to be in association with fellow proven winners. I also like having Malone and Maffei joining the board for new input. To see both sides, of course the hope is that new presence doesn’t backfire.
Look, as a shareholder who has incurred major losses, I understand that some of the frustration has not just magically disappeared. And most of those taking the position of “what have you done for me lately, now show me my money back tomorrow” are exemplifying that frustration. And I don’t belittle anyone who would love some or whatever portion possible of their investment back (ASAP). Now that this deal is done, I think we will all get some level of reconciliation going much sooner than later (and as fast as all the complex market elements will humanly allow). But which is a heluva lot better than us right now posting about what the next steps will be in BK court proceedings (besides the first of obtaining a case number), finding the new ticker in the Pinks, et al. Thankful to Mel and team for averting a total disaster for all common shareholders, I for one am focusing on that former reality and know it will happen in the right timeframe from here. I always say one has to be in or out. If one is “in” from here first there must be a clear understanding of the sequence of events (sans frustration of personal financial losses). And second, I think there must be a trust given to this management team to execute on on a high level and in a timely manner (across all channels). If not, one is just better off being “out” and moving on. I remain “in” right here. IMVHO…
Well said, s162, but methinks you’re preaching to the choir, Tyler et al is like us and on ‘our side’ collectively.
There have been times when Mel and Co. have seemed to be in with the likes of the new and, not-so-nice wall st. CEO’s. And while I appreciate the near death saves and antic’s, when they work, a lot of what has/and is done by management as far as I’m concerned, leaves a lot to be desired, especially by the likes of an unsophisticated investor like me who bet his stupid little fortune on this company, using his intuition, heart, and appreciation of the product (exactly what we’re told not to do…duh!!) and it’s future. So let’s remain united, and try to help us all get there……….!
I appreciate your opinion.
Sl62.
ES&D!
Tyler…
You are right on the money. From the time of the merger and the first ugly loan to this last loan, it has been one very long vicious ride through the twlight light zone for stockholders, analysts, and anybody connected to this stock.
Let’s get back to excuting a business plan.The company has been distracted for far to long.
imho
vaporgold
Socal…
I actually like SoCal. Used to live out there. But, thanks for your insightful reply…
S165:
Tyler “HAS” been right on the money through this entire process. And………has written insights that have personally helped me tremendously.
The fact that he is turning his attention now to the items listed above is a positive in my opinion.
If fact. Tyler continued to maintain a steady approach to all the wonderful things that have gone on with this equity, while most all others, caught the virus and jumped ship.
As to the rest of your posts, well, suffice it to say, that you and friggen reagan really need to get a room.
Socal…
Well at least you prove your keyboard works…
So first, Tyler knows I have treated him fairly and he also knows I was not of those who has ever accused him of erroneously pumping this stock. I WOULDN’T do so because I don’t ever look to MSM articles to make my investment descisions. Others who blame the world and Tyler for their possibly not-so-lucrative investments are who those people are. And there are plenty of them. They are called sheep. I read what MSM and people like Tyler put out and decide if that info is fair. If I think it’s not I will have something to say about it. And again, Tyler knows me from SA and knows this to be true. There is not necessarily anything damning about what Tyler has written here, I just believe it is ill-timed (as I said in my original post), considering the ink on the Malone deal is not yet even dry. And I also don’t think they need Tyler to tell them how they need to be executing on their business plan. But that’s here nor there. You and I are probably more on the same page than anything since I am a pro-SIRI poster but I also have no problem with you voicing your opinion (which I’m glad you finally did cause your first post doesn’t quite get it done my friend). I was decent to you only out of respect to Charles and Newman. Normally, with a post like that, you would get my black boot where the sun never shines! LOL…further, I don’t know what your comment about frigReg means. Sorry my friend, but I prefer women!! Lastly, you mention wonderful things that have gone on with this equity. I don’t know when you got in this stock but I have no idea of what you speak. This equity has CRASHED and crashed hard and many people like me have lost many thousands of dollars. If you are one of those who just got in down here at .13 (or lower) god bless. Good for you and I tip my hat to you. But that is not me (or many others here). So your “wonderful things” this equity has done fall on deaf ears and besides bizarre, is an inaccurate statement. IMVHO
XM radio is on all UNITED airlines flights, why SIRIUS is not all other airlines?
Coach buses on CJ trailways play XM radio, why Siri XM is not on Amtrak, Greyhound and all buses?
Supermarkets some play sirius, but playing it overhead in gas stations and supermarkets is FREE marketing
I have heard Delta sonic (car wash and gas station) playing Sirius.
well what about an Iphone app yes no what??
It’s a good time to re-live this interview. Advantage SiriusXM. Go Mel! Game on! Enjoy.http://www.cnbc.com/id/1584023.....38;par=aol
Thanks, Saatradical…………….sure clarifies all the shorting for me and almost make me feel sad I didn’t do some myself, could’ve had A-million shares by now !! All being said and done, I think we have another Kaz showing on the show sooner rather than later
PS: Cramer looks like he may have to eat some crow soon!!!
Draland. Can you get Cramer to admit it on tv. Because that’s where he should admit it. He hurt the equity on all fronts. Definitely in bed with GS the entire way.
Good luck to you.
Some numbers to consider. A high side free cash flow number for 2010 is 500 million. A reasonable valuation of 8x cash flow moves the stock to .70 cents. 2011 free cash high side is 750 million….8x cash flow moves the stock to 88 cents…..we all have to be realistic.
we need a Iphone app it only makes sense.
Yes. It’s time. The merger is over. The BK and 2009 debt issue is over(for now). It’s time for execution.
I agree with a lot of the posters here, Sirius needs to begin marketing it’s product better to the youth. A kick ass tv campaign a la “Apple” would be nice. They need to directly go after this market. Especially in regards to the internet. They need to go head to head with the likes of Slacker and Pandora.
Internet and Car radio is theirs for the taking if they creatively market their kick ass product to the mass market. There are so many people who don’t know what sat radio is still. Many others don’t know Sirius and XM merged.
The use of hip celebrities as someone mentioned would be cool. Sirius is so much more than radio. It’s sports and talk and uncensored comedy. Commercial free and nation wide. Add to this cell phone and iphone apps and the ability to download songs via the internet(partnership with Apple?) and you’ve got a true kick ass monopoly.
How long has it been since you saw a Sirius commercial? And I’m not talking about Sirius being mentioned in a car commercial. I’m talking about a 30 second actual Sirius Sat radio add.
I can’t even remember.
The last one I recall was for XM and baseball with the catchy “EVERY TEAM EVERY GAME” phrase….which I still can’t get out of my head.
Mel could create a series of ads. One that covers ALL the great content, and others that target each demo. They could use famous sports icons for the sports commercial. Rock icons for the music portion. etc
Yup. Time to execute. We’ve got a long way to go to get back over $1….but with the right marketing campaign, continued synergistic savings and growth….we can.
To get the stock back to over $1.00 Sirius will have to generate 1.25 billion in free cash….They are a billion dollars away from that today. I think they can but to manage expectations that is easily 4 years away.
frigginregan…
Of course I agree with your post (and relmor’s, etc..) but again, everything is happening in its proper framework IMHO…all these things you mention cannot happen overnight and with general economic conditions being what they are, it may be slower developing as some might like. But it is rest-assured they will happen, I have NO doubt. There is so much potential for this company and niche medium it’s sick. Before National Car snapped up MacEnroe, I had always envisioned a campaign with him…where he pops up in scenes where there is no Sirius (guy listening to terrestrial radio in his car) and Mac says You cannot be Sirius! Then with Satrad in the car scene and he says Now you’re Sirius!. But with all the content SIRI provides there are a host of options of celebs who could get out front of this. Or without the cost of celebs, I agree with a hip Apple-like approach to buzz the brand as high-end, cool, but still affordable (I would do away with the stick figure concept). And above all, a must-have for anyone. But again, I can see Mel and Co. are on top of it. I see the steps they are doing. I suggest that by end of summer we should see some new marketing really hyping for the upcoming holiday market–and maybe something fresh in between but on a smaller scale. Mel must still be frugal and keep productivity high during the next 3-6 months to keep the Q’s looking good. Maintaining solid COH numbers is a priority (as he himself said in September)..which then helps attract more investors, which then raises SP, which in turn raises market cap, which can lead to more working capital (and so on and so on). I also suggest we allow the company time to continue executing on viability issues and synergies (as they have already demonstrated IMO). I would love more communication to shareholders and the Street intra-Q, but otherwise, I for one believe they know what they are doing and deserve the chance to continue on “as you were”…and I have no doubt it will all continue coming together as all would love it to…
Tyler,
I agree with you completely. I invested so heavily in SIRI, because I trusted the management and its capabilities and experience and track record and I still believe that Mel and the body can turn this company around and do what Mel has done best for his entire career, which is to create job and create wealth for all common shareholders and investors.
SIRI truly can have a great positive impact on the entire market, demonstrating its management’s skills and the capabilities and feasibility of making money even in this tough economic time.
OK, Mel – the shackles are off, at least for the time being; this is your chance to show us what you’re made of. The potential is there, and everybody knows it. Let the American public know that there’s this cool thing called satellite radio, because Joe beer drinker/cops watcher is pretty clueless about it’s existence. This would be a good place to start!
I love this product and have since my first radio, The Sportster R-1, which still works after six years banging around everywhere I’ve managed to hook it up. I now have 4 subs and the internet and use it as a mainstay for music. I await the next generation of products that I am sure we will be exposed to this year as Father’s Day and then the Holiday Season later in 09 unfolds.
While I agree that executing on the business plan is at hand… I must say it has ALWAYS been at hand… Avoiding BK and taking care of debt in this awful economy, in one fell swoop, is a chore that few (myself included) thought possible, and has been every bit about executing on their business plan. The fact is, Mel and his Management Team did just that. Not to long ago I rated this stock as “show me”, and regardless of how expensive the deal, it keeps shareholders with an equity position… and that’s not bad for starters… I congratulate them for pulling this off and look forward to more up side surprises in the future… Getting creditors to believe in the success of your business plan so that they will commit millions of dollars to the to the company’s future, “shows me” that their on the right track…
Well COS. In spite of my earlier thread posts, I will now move to your position after reading this post and take the boss and his buddies to lunch. lol. Got back in Thursday. Hoping to ride it for a while. Hope all is well. Adios.
Interesting angles to consider…AT@T….Directv…Sirius….One company is a serial buyer (AT@T)….one is a serial tax advantage seller….( Malone Directv)…one is a serial seller who has tax advantages…unused losses..( Karmazan-sirius)…add more to the future possibilities Malone has a long relationship with AT@T. AT@T has an exclusive relationship with Apple. Would bet Directv and Sirius end up with AT@T in the next 3 years.
I agree – a sound business plan with a 5-10 year vision is necessary (I’m sure they have one). Then, it needs to be communicated. Then they need to aggressively market all of their products. Like Relmor noted earlier, we need to have a sexy add campaigne that has a catchy tag song and a credible star to speak a consistent message and catchy tag line.
For a song, Olivia Newton John had a hit in the 1980s (or was it the 70s??): Let’s Get Physical. It included the line “…let’s get physical, let’s get serious…” Just a thought.
A new Sirius product idea comes from Comcast: On Demand. You can watch 1000s of movies at any time you want for free. They also have newer movies you can watch any time for a small fee ($3.99 per). The idea: Have a Sirius XM service that has a programmed list of 1000s of songs that users can access at any time from the Internet or cell phone, or whatever listening devise they have (devise probably needs to be developed to allow user access to the servie). The service can be included as an addition to their monthy fee; or, added when price increases occur; or some other method. Again, just thinking out loud.
Can these ideas gain any traction?
Credit Suise, bought ~ 2.4M shares Friday, upping their % owned by 42%