Sirius Going T.U.?

[Conan71]

Rumors are getting around today that Sirius might be headed for Bankruptcy under a crushing debt load.

Unless DirectTV steps in, looks like there's a lot of people who might be stuck with worthless satellite radio equipment.

[DolfanBob]

I thought that XM was their saviour with the merger[?]

[cannon_fodder]

That equipment and the satellite bandwidth they own (do they own actual satellites?) are worth more DOING something than sitting there.  At a firesale, there will more than likely be some buyer.

[dbacks fan]

I guess all that money they are paying Howard is coming back in the way of subscribers.

[Wilbur]

One article I read said they were playing this card in order to get a new large stock owner to soak in more money.  Maybe a ploy.

I hope not.  I have XM.

[rwarn17588]

In the age of the iPod, when you can literally have days of music in something the size of a cigarette pack and make your own playlists, why would you have satellite radio?

I can see the possibilities with sports, maybe. But there isn't enough of a market for that.

[Conan71]

quote:Originally posted by inteller

quote:Originally posted by rwarn17588

In the age of the iPod, when you can literally have days of music in something the size of a cigarette pack and make your own playlists, why would you have satellite radio?

I can see the possibilities with sports, maybe. But there isn't enough of a market for that.

XM is nice for discovering new music without bothering downloading it and figuring out it sucks.  Of course, you can get all you can listen music subscription on a Zune and permanently keep 10 tracks each month, which you can't do with XM.

THe combined lineup was crap, everyone seemed to lose a favorite channel, but I do have to say the SiriusXM Chill station was better than before.  Still no way I would pay $16 for that.

Okay, that's all geek stuff way over my head.  Maybe Sgrizz is down with that.

I don't have a clue what the fees were for sat rad.  Never had it, never tried it.  I think people paying $92 a month for digital cable and internet should be showing up as a lot higher p/e for Cox, so $16 a month sounds like a smoking deal to me for sat rad, and on the surface, multiplied a few million times should have made someone money, but it never did.

I fail to see how companies like Sirius have such high debt without much in the way of physical assets.  I mean what ARE Sirius or XM's fixed assets other than over-paid talent like Stern if they are just leasing satellite bandwidth? (or whatever you call the broadcast capability on there).  

eBay is another mystery to me.  There is no reason for them to have such a high operating cost.  They own no inventory, no warehouses, it's basically a glorified DB and server farm.  So what if global spending is down, they have become a dominant global "e-tailer" and brought merchant services to the individual masses via Paypal (X.com for all you real eBay vets) in 10 years and have far, far less fixed plant PITA than a company like WalMart does.  With people losing jobs, they are selling off tangibles like crazy to stay afloat and eBay is the principal broker of personal and e-tail liquidity these days.

There's a market for satellite radio but apparently 3G and other web technologies are more economical or viable.  Users of the service might be kept whole, but sounds like share-holders are about to get reamed royally.  Echo-star (DTV) will likely be the big winner, pulling them down in what will amount to a $175K "foreclosure".

[sgrizzle]

I pay for a lot of services, but never paid for Satellite radio. I played with it in a renatl car and then after a few days plugged in the old mp3 player. I'm music ADD so I listen to local radio part time, mp3's part time, and internet radio stations part time. During the wee hours, most local stations don't have DJ's and the programming is bland & pre-recorded or infomercials ao at home or in my car I'll pull up KROQ (LA Station) over the internet or use something Pandora to play a custom station or Slacker to play a basement internet radio station.

(Yes I'm geeky enough to have internet radio in the car)

[kylieosu]

quote:Originally posted by Wilbur

One article I read said they were playing this card in order to get a new large stock owner to soak in more money.  Maybe a ploy.

I hope not.  I have XM.

Me too. I've had XM for four years. It's great for road trips and discovering new bands. Let's hope they make it.

[Townsend]

I received an email from them letting me know in order to continue listening to them online I needed to pay a $2.99 upgrade fee.

I couldn't justify it then and now this is happening, I'm glad I passed.  I might as well re-open my Launch station.

I do like having it in my auto and can easily justify the cost.

[Townsend]

http://tech.yahoo.com/news/ap/20090211/ap_on_hi_te/sirius_bankruptcy

Here comes Charlie Ergen

The chief executive of satellite TV provider Dish Network Corp. and sister firm EchoStar Corp. is a former professional gambler who bought much of a $300 million batch of discounted Sirius bonds that come due next week. He offered to restructure the debt and inject several hundred million dollars into Sirius in exchange for control over the company, according to The Wall Street Journal.

[Conan71]

Liberty Media (DirecTV) is supposedly also in talks.  The financial papers rumor mill is even saying AT&T or Verizon could save it.  

I did some more reading on it, Sirius owns dedicated satellites for radio service, XM has four more "generic" satellites in orbit and one on the ground which could transmit video and, apparently high-speed broadband for rural areas.  Again, that's getting pretty deep into geekery for me.

So there are attractive assets to other companies, now if they could just get out of that 5 year $500 Mil deal w/ Howard Stern. []

Put sat rad in the hands of Verizon or AT&T and it might finally make some fiscal sense with the rest of their product mix.

[Hawkins]

quote:Originally posted by inteller

quote:Originally posted by rwarn17588

In the age of the iPod, when you can literally have days of music in something the size of a cigarette pack and make your own playlists, why would you have satellite radio?

I can see the possibilities with sports, maybe. But there isn't enough of a market for that.

XM is nice for discovering new music without bothering downloading it and figuring out it sucks.  Of course, you can get all you can listen music subscription on a Zune and permanently keep 10 tracks each month, which you can't do with XM.

THe combined lineup was crap, everyone seemed to lose a favorite channel, but I do have to say the SiriusXM Chill station was better than before.  Still no way I would pay $16 for that.

Cable news, sports, talk radio on a variety of subjects...

I have Sirius. Paid for a year up front 3 years in a row, and was supposed to get the service for free from here out.

They tried to bill me for another year (a typical strategy of a dying company) but I wasn't having any of it.

Now I guess if they go bankrupt I'm the sucker anyway. Oh well.

The concept of not having to listen to Tulsa's lame radio stations was what got me on board in the first place.

[nathanm]

quote:Originally posted by Conan71


I fail to see how companies like Sirius have such high debt without much in the way of physical assets.  I mean what ARE Sirius or XM's fixed assets other than over-paid talent like Stern if they are just leasing satellite bandwidth? (or whatever you call the broadcast capability on there).  

Both XM and Sirius built and launched a few satellites to make their service go. XM chose to put their satellites in geosynchronous orbit, so they ended up having to build out a several-thousand strong network of terrestrial sites to supplement their signal in built up areas.

The Sirius sats are in an odd orbit that allows at least one of them to be overhead at any given time, rather than at only a 30 degree elevation to the south like the XM sats, so those satellites get better coverage without the terrestrial stations.

The launches were probably somewhere between fifty and a hundred million each, not even considering the cost of the satellites themselves.

Only Dish Network is leasing satellites at the moment, although the vast majority of their capacity is from their owned and operated hardware. DirecTV is leasing a slot from one of the Canadian providers that they've been using for locals in less populated markets, but they own all the hardware, and will be moving out of that space shortly. (Dish is taking half of it over with leased capacity on a newly launched satellite there)

[Conan71]

The story I read said $500mm to $750mm for one of the Boeing "general workhorse" satellites like XM has.  I don't think the shot into space was included in that figure.  So yes, I've uncovered more info on infrastructure investment since I posted that.