SIRI Intraday Updates for the Week of 11/03/08

[Keysmark]

One of the big things I have noticed:

They are only projecting 1.5 million adds for full year 09. If we figure that churn holds steady, we assume 50% penetration and 50% take rate, that means that they are counting on OEMs to only sell around 7 million cars next year.

There is absolutely no way.

Newman,

Everybody is talking about adds, but nobody mentions cancellations. These are Net adds.

Now this is entirely speculation on my part. But there must be a large number of people that have (had) subscriptions to both services. With the advent of the "Best Of", it may be than a number of these people have, or are expected to, cancelled one service and have just added "Best Of". Is that a run on sentence?

It's a possible answer to your question, even though I have absolutely no data to back up my speculation.

[Demian]

http://www.tmcnet.com/usubmit/2008/11/06/3767356.htm

[November 06, 2008]
Sirius XM faces daunting challenges

CHICAGO, Nov 06, 2008 (Chicago Tribune - McClatchy-Tribune News Service via COMTEX) --
It's hard to cite Sirius XM Radio Inc.'s most daunting challenge: Is it the $1 billion in debt payments, a bad economy or plummeting new car sales, the satellite radio company's biggest avenue for new customers? And what about the next big threat, free Internet-enabled audio choices?

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On Thursday, Sirius XM noted in a regulatory filing that sluggish auto sales "have negatively impacted subscriber growth" and that it is in discussions with lenders regarding new financing options. It said "such financing may not be achieved or, if achieved, may not be achieved on favorable terms."

Just a few months after its merger was approved, Sirius XM Radio "faces an issue of survival," said James Goss, an analyst with Chicago's Barrington Research. "I'm trying to be realistic, but the question is do you believe they will survive?"



He believes Sirius XM will survive, and he has an outperform rating on its shares. Other analysts have downgraded the stock.

Sirius stock has lost 91 percent of its value in 2008, closing Thursday at 26 cents, unchanged from its opening price.

Sirius XM did not make an executive available for this story, citing a quiet period prior to releasing earnings next week. But in an October BusinessWeek story, Chief Financial Officer David Frear said the company is "very confident" it would meet its debt obligations in 2009.

When the merger between Sirius and XM was approved in July by federal regulators, the hope was that a single satellite company could thrive now that consumers didn't have to make a choice. But to close the deal, they took on additional debt at a high cost, Goss said.

Also, the merged company agreed to several conditions from federal regulators, including new pricing and radios that could receive both Sirius and XM services.

Those products have started to emerge over the last month, with more to come over the next year. The company's hope is that a new generation of products, prices and services can boost slowing sales.

Subscribers can add a "best of" package from the channel line-up of Sirius or XM to their existing radios for $4 a month. This will bring Howard Stern's Sirius program, among other content, to XM users. Or Sirius users can add a package that includes Oprah's radio channel.

But in an economy where consumers are closely examining their spending, paying $7 to $17 a month might be a tough sell for Sirius XM. Plus, the Internet and speedier networks from wireless carriers are providing a rich array of free content.

"If you look at the other types of free options, like iPods or CDs, that has been there all along," Goss said. "But the choices have increased over the years and Internet radio, at some point, could pose a competitive threat. But it needs to get on the dash."

Tom Taylor, a radio industry veteran who writes for Chicago trade publication Radio-Info.com, agrees that car-based Internet connections are the biggest threat to satellite radio. "When that comes along, the value proposition becomes very questionable," he said.

Still, despite declining car sales - major automakers this week reported declines ranging from 23 percent to 45 percent - Goss said used cars could become a more viable source for Sirius XM.

"More used cars are on the market these days that have an XM or Sirius radio that's ready to use," he said.

In addition, he noted that new-car buyers are offered incentives to try the Sirius XM service - free trials, for example - to lure new listeners. Also, many car buyers can have the service tacked onto their car payments.

A spokesman for Sirius noted that the company is looking at incentives to lure used-car buyers to the radio service.

Sirius XM expects to have 19.1 million subscribers by the end of this year, and estimated it will have 20.6 million by the end of 2009. Previously, it said it would reach 19.5 million this year and 21.5 million in 2009.

Goss said that "Sirius had been adding a couple of million subscribers a year" by itself prior to the merger.

When the deal closed in July, the combined company had 18.6 million customers, so even Thursday's reduced forecast shows that it added a half-million customers in the second half of this year. And, the spokesman noted, Sirius XM has a churn rate of less than 2 percent for paying customers.

[Demian]

Nov. 6, 2008 Market Close: $ 0.26



Pre-Market Trade Reporting

Pre-Market
Last: $ .2821
Pre-Market
High: $ .289
Pre-Market
Volume: 48,272
Pre-Market
Low: $ .2802

Pre-Market
Time (ET) Pre-Market
Price Pre-Market
Share Volume
08:24 $ .2821 100
08:22 $ .2887 5,000
08:22 $ .2888 1,000
08:20 $ .2888 8,773
08:20 $ .2888 1,000
08:19 $ .2888 662
08:16 $ .2887 4,899
08:16 $ .2888 1,101
08:15 $ .2888 437
08:12 $ .2888 3,800
08:06 $ .281 7,700
08:05 $ .285 8,000
08:05 $ .286 400
08:04 $ .286 1,000
08:03 $ .286 100
08:03 $ .288 100
08:03 $ .2802 200
08:02 $ .289 4,000

[Demian]

http://www.signonsandiego.com/news/b...7directed.html

Directed plans to stop making Sirius car radios
Alarms, speakers to be firm's focus

By Mike Freeman
UNION-TRIBUNE STAFF WRITER
November 7, 2008

Dumping satellite radios will save Directed $20 million to $25 million in working capital, its chief executive said.
Directed Electronics began riding the satellite radio wave in 2004, when it signed up to make car radios for Sirius – the home of shock jock Howard Stern.
At its peak, Sirius radios cranked up Directed's sales by an additional $220 million annually, making up about half of the Vista-based company's revenue.

But it didn't last, as satellite radio subscribers opted for iPods and a proposed merger between Sirius and rival XM dragged on over antitrust concerns. Directed's Sirius radio sales are expected to be only $75 million to $90 million in 2008.

This week, Directed announced it was dumping satellite radios after four tumultuous years to focus on its core products of car alarms and audio speakers.

The move will save the company $20 million to $25 million in working capital that is tied up in inventory and other uses for the Sirius product, said chief executive Jim Minarik. The company will use the proceeds to pay down debt.

The agreement between the two companies officially ends Jan. 31. Directed will sell its remaining inventory back to Sirius, which will assume all warranty work.

In a research note to clients, analyst Mark Argento of Craig-Hallum Capital Group called the move a positive for Directed. He said it should reduce risk for the company in a soft economy.
Minarik said profit margins on the radios have shrunk over the years, and the company has been plagued by warranty issues. Directed makes and markets the product to retailers but does not design the radios.

Also this week, Directed reported sales of $61.8 million for the third quarter, compared with $84.5 million a year earlier. It posted net income of $1.1 million, or 4 cents a share, compared with a loss of $1.25 million for the same quarter last year.

Sales of the company's Polk-brand audio speakers to Best Buy helped bolster its results. Directed, founded by Rep. Darrell Issa, R-Vista, makes Viper, Clifford and Python car alarms and remote starting systems, Orion and Polk audio speakers, and other products.

[Keysmark]

"Sirius XM did not make an executive available for this story, citing a quiet period prior to releasing earnings next week."

This was the Chicago Tribune requesting to speak to management. No wonder we can't get any response.

There are two ways to look at this. Either we are completely finished, or they have a blockbuster announcement to make. Or---anything in between.

[Demian]

http://www.chicagotribune.com/busine...,1725015.story

Sirius XM Radio channeling fears
Satellite service deals with slowing spending, auto sales

By Eric Benderoff | Tribune reporter
November 7, 2008
It's hard to cite Sirius XM Radio Inc.'s most daunting challenge: Is it the $1 billion in debt payments, a bad economy or plummeting new-car sales, the satellite radio company's biggest avenue for new customers? And what about the next big threat, free Internet-enabled audio choices?

On Thursday, Sirius XM Radio noted in a regulatory filing that sluggish auto sales "have negatively impacted subscriber growth" and that it is in discussions with lenders regarding new financing options. It said "such financing may not be achieved or, if achieved, may not be achieved on favorable terms."

Just a few months after its merger was approved, Sirius XM Radio "faces an issue of survival," said James Goss, an analyst with Chicago's Barrington Research. "I'm trying to be realistic, but the question is, 'Do you believe they will survive?' "

He believes Sirius XM Radio will survive, and he has an "outperform" rating on its shares. Other analysts have downgraded the stock.

Sirius stock has lost 91 percent of its value this year, closing Thursday at 26 cents, unchanged from its opening price.

Sirius XM Radio did not make an executive available for this story, citing a quiet period prior to releasing earnings next week. But in an October BusinessWeek story, Chief Financial Officer David Frear said the company is "very confident" it would meet its debt obligations in 2009.

When the merger between Sirius and XM was approved in July by federal regulators, the hope was that a single satellite company could thrive now that consumers don't have to make a choice. But to close the deal, they took on additional debt at a high cost, Goss said.

Also, the merged company agreed to several conditions from federal regulators, including new pricing and radios that could receive both Sirius and XM services.

Those products have started to emerge over the last month, with more to come next year. The company's hope is that a new generation of products, prices and services can boost slowing sales.

Subscribers can add a "best of" package from the channel line-up of Sirius or XM to their existing radios for $4 a month. This will bring Howard Stern's Sirius program, among other content, to XM users. Or Sirius users can add a package that includes Oprah's radio channel.

But in an economy where consumers are closely examining their spending, paying $7 to $17 a month might be a tough sell for Sirius XM Radio.

Plus, the Internet and speedier networks from wireless carriers are providing a rich array of free content.

"If you look at the other types of options, like iPods or CDs, that has been there all along," Goss said. "But the choices have increased over the years and Internet radio, at some point, could pose a competitive threat. But it needs to get on the dash."

Tom Taylor, a radio industry veteran who writes for Chicago trade publication Radio-Info.com, said that car-based Internet connections are the biggest threat to satellite radio. "When that comes along, the value proposition becomes very questionable," he said.

Still, despite declining new-car sales—major automakers this week reported declines ranging from 23 percent to 45 percent—Goss said used cars could become a more viable source for Sirius XM Radio.

"More used cars are on the market these days that have an XM or Sirius radio that's ready to use," he said.

In addition, he noted that new-car buyers are offered incentives to try the Sirius XM Radio service—free trials, for example—to lure new listeners. Also, many car buyers can have the service tacked on to their car payments.

A spokesman for Sirius noted that the company is looking at incentives to lure used car buyers to the radio service.

Sirius XM Radio expects to have 19.1 million subscribers by the end of this year, and estimated it will have 20.6 million by the end of 2009. Previously, it said it would reach 19.5 million this year and 21.5 million in 2009.

Goss said "Sirius had been adding a couple of million subscribers a year" by itself prior to the merger.

When the deal closed, the combined company had 18.6 million customers, so even Thursday's reduced forecast shows it adding a half-million customers in the second half of the year.

And, the spokesman noted, Sirius XM Radio has a churn rate of less than 2 percent for paying customers.

ebenderoff@tribune.com

[Demian]

Pre-Market Trade Reporting

Pre-Market
Last: $ .2712
Pre-Market
High: $ .2899
Pre-Market
Volume: 199,292
Pre-Market
Low: $ .2702

Pre-Market
Time (ET) Pre-Market
Price Pre-Market
Share Volume
09:14 $ .2712 20,000
09:13 $ .2711 1,000
09:13 $ .2711 1,000
09:13 $ .2712 8,000
09:12 $ .2712 4,000
09:07 $ .2712 1,000
09:05 $ .2712 9,000
09:05 $ .2702 5,000
09:05 $ .2702 5,000
09:05 $ .2702 3,500
09:03 $ .272 1,300
09:02 $ .276 10,000
09:02 $ .275 750
09:02 $ .275 6,960
09:00 $ .28 5,000
08:59 $ .281 5,000
08:59 $ .281 5,000
08:59 $ .281 12,300

[Keysmark]

Schwab Charles Investment Management Inc

Institution 0.00 % 2008-11-06 1,327,888 $345,251 $0 0.00 % New Holding 1,327,888 100.00 % $0

[Demian]

Prediction - SIRI runs into earnings...


Note:
Please consult your financial advisor before making any financial decisions - I am not a financial advisor.

[Keysmark]

Notice the new holdings and Added more Columns


Fund Fund Type Fund Perf. Report Date Current Shares Current Value Value Chng. Return Activity Shares Chng. Shares Chg.% Results
Bank Of Hawaii Institution 0.00 % 2008-11-06 2,500 $650 $0 0.00 % No Change 0 0 % -
Cinfin Capital Management Co Institution 0.00 % 2008-11-06 379,324 $98,624 $0 0.00 % No Change 0 0 % -
Schwab Charles Investment Management Inc Institution 0.00 % 2008-11-06 1,327,888 $345,251 $0 0.00 % New Holding 1,327,888 100.00 % $0
Vanguard Group Inc Institution 0.00 % 2008-11-06 81,317,278 $21,142,492 $0 0.00 % Added More 81,164,684 53189.95 % $0
Sg Americas Securities Llc Institution 0.00 % 2008-11-06 873,933 $227,223 $0 0.00 % Added More 661,306 311.01 % $0
Dlibj Asset Management Co Ltd Institution 0.00 % 2008-11-06 290,622 $75,562 $0 0.00 % Added More 150,171 106.92 % $0
Ghp Investment Advisors Inc Institution 0.00 % 2008-11-06 4,000 $1,040 $0 0.00 % Sold Some -2,000 -33.33 %