XMSR (XM radio)

Anyone for or against this stock?

When I first heard about it I thought it was a horrible idea. I looked into it. First of all I am not a pro investor but these were my thoughts. I shorted it at 16 now at 12.5 (up +.50 today) Who would pay 300 bucks for a new car radio then pay 10.00 a month to get radio? People are poor these days.


I saw they had an IPO a while back. Why? short on funds? I am going to cash out because I expect a short term rise in the stock. But then a big downfall.


Their first wave of marketing was poor. Now that they have gone mainstream they are getting a lot of press. Espn signed a deal for an expn station. They are signing deals with Ford so all new cars they sell have the XM radio feature installed. You can also have the 10.00 payment tied into your car payment. I have seen several full page adds in various magazines and newspapers. Their pub relations department is doing a lot of good work. Yesterday someone wrote XM radio is the best invention of the year. The end result is they have spent a ton of money and not sold many subcriptions. They have NEG earnings. They are projected to have NEG earnings again this quarter. Will they ever start making money? My bet is no or not much. I just don't see people paying for digital radio.


I am thinking once their little flash in the pan is over I will look into buying some put options. It says it may be hard to borrow shares however.


What are your thoughts?


thanks

brian

I can't comment about the stock but they would have to pay me to get this garbage!

Gee guys, I feel like a sucker now. I signed up for it. Come on, how hard is it for the average person to spend $120 on radio? If you like formula radio with the same 12 songs for each station, you wouldn't pay for it. However the variety is incredible and it fits every mood you might have. Further there are a lot of niches that get little or no airtime and paying less than one CD for it is certainly worth it. I haven't been a buyer of CDs since the record companies pissed me off with their treatment of Napster so I have plenty of formerly spent money to use on this. However I would say everyone I know buys at least 10 CDs a year and if they cut that down in half they would save almost enough to pay for this service. Besides I take a lot of roadtrips and its an absolute godsend for those! Driving through Utah on the way to SLC for the Olympics we tried regular radio just for a kick to see what crap we would have to listen to. Three religious stations (it was Utah on a Sunday), two country, one classic rock, one sleepy time soft rock, and one jazz station...not a whole lot to listen to. If you live in LA, SF, NY, etc...I could see it being a lot less worthy, but those are places with a lot of people that spend a ton of time in their cars and have lots of disposable income, not to mention very eclectic tastes so I think it sells itself just about anywhere.


My final point is, does anyone really like rush hour radio where they play about 2 songs an hour and repeat the traffic every 5 minutes on every station on, of course in between 5 minutes of commercials every 20 minutes???

do they have sports talk?


and where does this variety come from?


are they broadcasting many radio stations, or just music?


advertisements?

About half the stations have ads, but for now they are very short like 1 minute or less. I imagine if they get a bigger base of listeners they will get more ads, but the thing is its so easy to change channels that I doubt they will ever generate much in the way of ads. As for the variety they have everything. They have three stations of sports talk, including ESPN and Sporting News, they have about every NASCAR race on, their music stations are almost all just themes without DJs, as they only have one regular radio station as we think of them. The rest are just things such as 70s or Indie Rock, things like that. For a subject like jazz they have 5 varieties. I think many people have seen what they offer on digital cable, its a similar idea mostly, except more variety. I will tell you this, at first it seems stupid paying for radio, but once you get it you are hooked and you can't imagine life without it. Think of how most broadcast stations are, they might play a song you love followed by a song you hate, all because they have to be very generalized. These stations follow one specific genre of music. Its very similar to TV, the networks have to show a bit of everything while cable stations often stick to one them such as sports or news or movies. Think back to the early 80s, I remember many people (including my old man) who said "who the hell is going to pay to watch more TV channels?" Well same thing here.

Hi wildbill,


Thanks for calling XMSR to my attention. I think that they have a very sound, well thought out plan in place. I'll be looking to buy in the 10.00 area.


Here's the web site for those who may want to check it out a little more. (or listen to it)


http://www.xmradio.com/


FWIW, I do not see this as a short term play in any way, may take 5 years to get a foothold. The first place for the market is the truckers, and the new car market. Imagine driving from NYC to LA and never having to change a CD or a station, or miss the ninth inning in a ballgame...


We shall see.


SteveB