XM issues $400,000,000 Ammendment to Offering
XMSR Issues $400,000,000 amedment to offering On a Friday afternoon after close, and on the last day of the first quarter, XM Satellite Radio issues a $400,000,000 ammendment to offering. The filing states: 1. We issued $300,000,000 aggregate principal amount of our 1.75% convertible senior notes due 2009 in a private placement on November 23, 2004 and an additional $100,000,000 aggregate principal amount of notes on January 12, 2005. Selling securityholders may offer from time to time up to $400,000,000 of the notes and 8,000,000 shares of our Class A common stock issuable upon conversion of the notes. 2. We will pay interest on the notes at an annual rate of 1.75% of the principal amount, from the date of issuance to December 1, 2009, payable on June 1 and December 1 of each year, commencing on June 1, 2005. The notes will mature on December 1, 2009 unless earlier converted or repurchased. 3. The notes may be converted into shares of our Class A common stock at any time prior to their maturity or their repurchase by us. The initial conversion rate is 20.0 shares for each $1,000 principal amount of notes, subject to adjustments. This is equivalent to an initial conversion price of $50.00 per share. 4. If certain fundamental changes occur, we will in certain circumstances increase the conversion rate by a number of additional shares of Class A common stock or, in lieu thereof, we may in certain circumstances elect to adjust the conversion rate and related conversion obligation so that the notes are convertible into shares of the acquiring or surviving company, in each case as described herein. 5. The notes are our general unsecured senior obligations, ranking equal in right of payment to all of our existing and future senior indebtedness and senior in right of payment to any of our existing and future subordinated indebtedness. In addition, the notes will be effectively subordinated to any of our existing and future secured indebtedness to the extent of the assets securing such indebtedness and structurally subordinated to the claims of all creditors of our subsidiaries. 6. We may not redeem the notes at our option prior to the stated maturity date. 7. The selling securityholders directly, or through agents designated from time to time, or through dealers or underwriters to be designated, may sell the offered securities from time to time on terms to be determined at the time of sale. See “Plan of Distribution.” To the extent required, the specific offered securities to be sold, the names of the selling securityholders, the respective purchase price and public offering price, the names of such agents, dealers or underwriters, and any applicable commission or discount with respect to a particular offer will be set forth in an accompanying prospectus supplement or post-effective amendment to the registration statement of which this prospectus is a part. 8. We will not receive any proceeds from the sale of the notes or shares of Class A common stock issuable upon conversion of the notes by any of the selling securityholders. The notes and the shares of Class A common stock may be offered in negotiated transactions or otherwise, at fixed prices, at market prices prevailing at the time of sale or at negotiated prices. In addition, shares of our Class A common stock may be offered from time to time through ordinary brokerage transactions on the Nasdaq National Market. See “Plan of Distribution.” Each of the selling securityholders reserves the sole right, together with its agents from time to time, to reject, in whole or in part, any proposed purchase of the offered securities to be made directly or through its agents. 9. The selling securityholders and any broker-dealers, agents or underwriters that participate with the selling securityholders in the sale of the offered securities may be deemed to be underwriters within the meaning of the Securities Act of 1933. Any profits realized by the selling securityholders may be deemed to be underwriting commissions. Any commissions paid to broker-dealers and, if broker-dealers purchase the offered securities as principals, any profits received by such broker-dealers on the resale of the offered securities, may be deemed to be underwriting discounts or commissions under the Securities Act. 10. We have not applied and do not intend to list the notes on any national securities exchange. 11. Our Class A common stock is listed on the Nasdaq National Market under the symbol “XMSR.” On March 30, 2006 the closing sale price of our Class A common stock on the Nasdaq National Market was $22.41 per share. More information is available in the SEC filing or at www.xmradio.com3/31/2006 11:39:00 PM
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Smiths and Morrissey Reunion Weekend
 Sirius Satellite Radio stream “First Wave” (stream 22) will be having an exclusive Smiths reunion all weekend long. The programming starts Friday March 31st and runs all weekend. The Smiths Reunion Weekend will include everything Smiths and Morrissey. Fans can hear rare tracks, live songs, and will even get a premiere of the new Morrissey CD before it hits store shelves. Find more information here. Link to this write up is: http://tinyurl.com/zrcjx3/31/2006 12:20:00 PM
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Bubba The Love Sponge At Tampa Fairgrounds
 Bubba The Love Sponge and the rest of the Show Crew (including Ned, Manson, and Brent) will be at the Florida State Fairgrounds in Tampa for the Circuit City Tent Sale. They will be there on Saturday April 1st from 11A to 1P. The Tent Sale will be at the Fairgrounds from Friday, March 31st through Sunday, April 2nd. Meet Bubba, and buy the latest Sirius Hardware. Bubba's live show airs Monday through Friday from 3:00 PM to 7:00 PM EST (12:00PM to 4:00PM PST) on Howard 101. It also replays from 12:00 AM to 4:00 AM EST (9:00 PM to 1:00 AM PST) the following morning. The show broadcasts Bubba's own brand of radio and is interlaced with regular segments relating to things from mens health to Nascar. So tune in and find out what a McGuilicutty is. The link to this write up http://tinyurl.com/zqvv23/31/2006 11:27:00 AM
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Landenburg Thalmann Initiates coverage for Sirius
March 31, 2006 Landenburg Thalmann initiates coverage on Sirius satellite Radio with a BUY rating and a target of $6.00. We at SSG feel that the report by William Kidd of Landenburg Thalmann was very well thought out, and highlights the import areas that investors need to condsider in the SDARS sector. Highlights> Clear momentum: We don’t expect Sirius to give back its retail gains so easily. After strong net adds growth in 4Q05 and what appears to be an impressive 1Q06 follow-up performance, there has been considerable conjecture over the “Howard effect” and how long it may last. Although we’re forecasting a significant sequential drop in 2Q06 gross adds, we still expect Howard Stern to be extremely relevant at the point of sale. When a potential subscriber runs through their mental checklist, even if they’re not fans of Howard or the NFL, both packages speak well of the overall quality of Sirius’ programming line-up, which is why we believe Howard is going to be a factor for a long time. > Sometimes perception becomes reality. We believe investor perception could increasingly favor Sirius in 2006. With the technology gap between Sirius and XM quickly waning, Sirius’ mix of high profile management, vis-à-vis Mel Karmazin, dramatic market share gains, and proven content could prove to be an intoxicating cocktail. > Isn’t terrestrial radio the enemy? At some point, Sirius and XM need to eat someone else’s lunch. We are concerned by Sirius’ increasingly competitive stance, in what should be a more cooperative duopoly, and its willingness to write large checks payable in company equity. For instance, we suspect that the company’s recent acquisition of Volkswagen may have carried higher incentives than what XM was paying. If both Sirius and XM management continue to contest every piece of content and every OEM partner, the positive economic model that we envision in 2010 and thereafter could be in jeopardy. > We see upside from current price levels. We are initiating coverage of Sirius with a Buy recommendation and $6.00 year-end target based on our DCF. We would be opportunistic with Sirius shares given the combination of ThemesWhat’s Good News for One is Good for the Other? Take Advantage of the Market’s Constant Indecisiveness. In recent months, even when positive news has surfaced for one, which was negative for the other, the market has tended to almost equally reward both Sirius and XM shares. It sometimes seems as if market participants are arbitraging valuation discrepancies between the two, believing that both should be valued similarly on an enterprise value or some other basis. The market seems as if it is having difficulty deciding on what is better: XM’s larger subscriber base or Sirius’ momentum and content. At these prices, we think the answer is relatively easy. XM’s past and future GM subs (at least through 2013, when we expect the GM agreement to terminate) are worth less than the typical sub, in our opinion, giving Sirius an advantage in some key areas. That difference alone impacts millions of past and projected XM subscribers, making it important to consider. We think that the costly GM agreement reduces XM’s willingness to spend heavily on other agreements, affording Sirius some comparative, operational flexibility. That said, Sirius’ new penchant to spend might not always be the smartest move, given they are operating in a duopoly, and if programming costs continue to be bid up over time, both companies will ultimately lose. Addicted to DilutionSirius has been heavily reliant on using equity to cover operating costs and wages. In 2004 and 2005, Sirius recorded an expense for “equity granted to third parties and employees” of $126.7mn and $163.1mn, respectively. Besides the dilution, the payment choice is creating significant distortion in the company’s P&L. For instance, if these expenses were paid in cash as opposed to equity, Sirius’ reported SAC line item would have been $49.7mn (14%) higher, sales and marketing $42.1mn (25%); and content costs $19.5mn (20%). The adoption of SFAS No. 123R, which the company will reflect as of January 1, 2006, does not help matters. Sirius’ 2005 expense would have been roughly $50mn higher, totally about $212mn, under 123R. We do not think the solution is as simple as Sirius simply paying in cash instead of stock and options. Rather, we think Sirius management needs to get considerably more cost conscious. Even before the equity is factored into the company’s expense analysis, adjusting for scale (e.g., subs), Sirius’ spending is above XM in many areas, such as SAC, content and customer care. Thus, we think the company’s eagerness to spend is a concern, particularly at this early stage. Keep in mind, Sirius is not spending a war chest. Sirius is planning to nurse its business on prepayments from customers for years, as opposed to sustained profitability, which is almost a form of borrowing in and of itself. In the end, perhaps debt is another alternative for management, since it at least holds management more accountable for the magnitude of the spending. Note: In 1Q06, Sirius will recognize a charge $225 million (34,375,000 shares) for the equity granted to Howard Stern and his agent, which was supposed to vest when Stern contributed 1 million subs. Sirius apparently amended its agreement with Stern. The net result was that it allowed Stern to receive this stock award immediately and for Sirius to put the large share expense in its past. Even after this award, Stern is still eligible to receive additional shares from Sirius. We believe sometime around year-end 2006 or shortly thereafter, the company will compare its subscriber levels to what was projected prior to Stern’s arrival, and award him a share per subscriber for some portion of the difference. Given the strong 4Q05 and our projections for 2006, we believe Stern will be eligible for an award, perhaps in the ballpark of 1 to 2 million shares. We believe this process will be repeated at the end of each year of Stern’s five-year agreement. Investment ThesisFor most of the past few years, Sirius has struggled to overcome delays in launching its service and less than favorable comparisons with its rival, XM Satellite Radio. In 4Q05, Sirius was able to sign 1.1 million net adds due in large part to Howard Stern’s pending arrival as well as the Holiday Season. The quarter was a watershed event in Sirius’ history, since it was the first time it was able to surpass its rival in net adds growth. The accomplishment is even more significant when one considers Sirius surpassed XM’s overall growth without much of an OEM effort. On a go forward basis, we expect Sirius to continue to show its strength in the retail channel. But on an absolute/total basis, XM should be able to regain some of its lost thunder in the second-half 2006, and more likely 4Q06, as a result of continued growth in OEM sales. Even so, if XM does not regain retail dominance in 2006, Sirius’ gains will serve as an important harbinger to the market. Since the result would suggest that when consumers have a choice, they prefer Sirius. At least for now, we do not see the OEM market as necessarily the best long-term demand indicator since the sales are captive, based on the aggressiveness of one’s auto partners. At this relatively early stage in satellite radio’s life cycle, the aggressiveness still varies widely between automakers. In time, we think the efforts will normalize and be fairly consistent across the board. With more time, consumers may ultimately get more of a say in the OEM market as well, if some automakers become un-exclusive and/or radios become interoperable between the Sirius and XM systems. If that were to occur, it would place even more importance on the immediate retail market share numbers, which we think will be consistently favorable to Sirius. The potential wildcard in 2006 being the strength of Oprah with XM, which we presently do not think will lead to a material retail market share shift. Longer-term, our projections reflect the belief that Sirius, much like XM, will see a considerable shift in its business from retail to OEM, as Sirius’ auto partners become more involved. We believe it’s the natural progress of satellite radio for the bulk of its business to come from new car sales, versus the retail channel. Our two biggest concerns long-term relate to churn and programming costs. We assume both worsen considerably over time. We believe Sirius’ churn will trend higher as it moves into OEM sales much like what XM has experienced with its OEM subscribers. In addition, Sirius recognizes OEM subscribers at shipment to the lot, in order to match SAC with gross adds. While we don’t disagree with the accounting practice, the process naturally creates higher churn, since some new car purchasers will elect not to activate or continue on with Sirius. In terms of specifics, we are forecasting churn to rise to 2.3% per month in time, above the 1.8% average of 2005. Of our two concerns, programming is a bigger theoretical risk in our opinion, given the power that we perceive programmers have in other comparable subscription businesses, like pay television. Satellite radio has avoided some of the pitfalls of content costs because it is able to produce so many channels inhouse and music royalties are relatively cheap. That said, the risks of overpaying for or of high priced programming is clearly evident in agreements from Howard Stern to the NFL. At this stage of the company’s life cycle, we still see Sirius having considerable power over programmers, since so much of the growth is still ahead of the company. For now, programmers do not want to risk losing a spot on the platform at such an early stage. However, as the business matures in the out years, we believe the power could shift considerably towards content producers, as the loss of a key channel or two could lead to subscriber Sirius Satellite Radio (SIRI) disruption. Programmers tend to use such fears to negotiate favorable rate adjustments. Valuation The net result of our thesis is what we believe to be a fairly balanced outlook for Sirius. Within the parameters of our DCF, which extends through 2015, we value Sirius at $6.00 as of year-end 2006, incorporating a 11.0% WACC and a 7.0% terminal growth rate. Given that in 2015, our EBITDA and unlevered free cash flow increase at 15.5% and 22.0%, respectively, we do not feel that our terminal growth is unrealistic. The link for this write up is http://tinyurl.com/j5c263/31/2006 10:17:00 AM
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NEW S50 UPDATE
 HOW TO COMPLETE THE UPDATE FOR THE S50Make sure the battery is installed in the S50 and it is fully charged. If the battery is not installed, or is only partially charged, the software updates may not install properly. The complete update of your S50 has three components: 1. An upgrade to your S50 2. An upgrade to your vehicle dock 3. An upgrade to the firmware STEP 1: COMPLETE THE S50 SOFTWARE UPGRADE 1. On your computer, make sure you’ve successfully downloaded the S50 application software updates and have closed the “Device Settings” windows. 2. From the My Sirius Studio software, press to eject the S50 from your computer. 3. Wait for the S50 picture to disappear from the My Sirius Studio window. Your computer should display the message “Safe to Remove Hardware”. 4. Disconnect the USB cable from the S50. 5. Once you’ve disconnected the USB cable, the S50 will display “Restart for Update” and will power off within approximately 10 seconds. DO NOT PLACE THE MEDIA PLAYER IN A DOCK AT THIS TIME.
6. Press and hold the Playlist button on the S50 to turn the S50 back on. 7. Once it powers on, the S50 will display “SOFTWARE Updating…” and will complete the software update. 8. When the software update is complete, the “Update Complete!” message will be displayed and the S50 will turn itself off. Step 1 is now complete. STEP 2: COMPLETE THE S50 CAR DOCK UPGRADE1. Once you’ve completed the S50 software upgrade, place the S50 in an S50 car dock. The S50 will display “CAR DOCK Updating…” and will complete the car dock software update. 2. When the S50 car dock update is complete, the blue LEDs on the car dock will flash multiple times, the S50 will display an “Update Complete!” message, and the S50 will turn itself off. Step 2 is now complete STEP 3: COMPLETE THE S50 FIRMWARE UPGRADE1. Place the S50 into a car or home dock and make sure it’s receiving SIRIUS satellite or terrestrial signal. 2. Once it powers on, the S50 will display “Firmware Updating…”, followed by “Updating, xx% complete”. The percentage will increase as the update progresses. It takes approximately 4-5 minutes to complete the update. DO NOT UNDOCK THE UNIT DURING THE UPDATE PROCESS.
3. When the update is complete, the S50 displays the “Update Complete!” message for 2 seconds and then powers off. 4. You’ll need to undock and re-dock your S50 to power it back on.This process also updates the Sirius channels if needed. Step 3 is now complete YOUR UPDATE IS NOW COMPLETE 3/31/2006 08:41:00 AM
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Satellite Radio Churn
Satellite Radio Churn is a measure of the number of subscribers who leave the service during a specified period of time. Sirius and XM count churn in different ways, and it is important to understand those differences. A direct comparison of the reported churn numbers does not give you an accurate picture of what is happening. Churn is not governed by GAAP (Generally Accepted Accounting Principals). This means that companies are allowed to report churn in any manner they desire as long as they disclose the methods they choose to utilize. Sirius Churn is calculated as follows:Average monthly churn represents the average of the number of deactivated subscribers divided by the average quarterly subscribers. The Sirius radio method for reporting churn is fully inclusive of ALL deactivations (retail, OEM, and rental) XM Churn is calculated as follows:XM does not count all deactivations in their churn. Subscribers in promotional periods who elect to not continue the service are not counted as churn. They are simply dropped from the subscriber roles. To be clear…..Neither method is right or wrong. Each company can determine the method they use. If you want to compare churn, it is best to measure the company against itself to see if there is improvement. If you feel the need to compare the two companies, pick one method and calculate both companies churn rate using that method. The link to this write up is http://tinyurl.com/hrc7d3/30/2006 10:20:00 PM
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Sirius' OEM Count
 Some Sirius OEM subscriptions (DCX) are counted at the time of manufacture. The reason for this is that DCX pays Sirius up front for a 1 year subscription that Sirius is then passing onto the end user of the automobile. There are people that take exception to this practice, and people that accept it. Here are some things to note: Sirius pays the subsidy for the radio install up front. This is a Subscriber Acquisition Cost (SAC). This means that Sirius has already invested the dollars into creating a subscriber. 2. Sirius receives the subscription revenue (from DCX) at the time of manufacture. Units receiving revenue are counted as subscribers. Sirius accounts for the full impact of the subscriber cost, and books the revenue over the first12 months that the end user has the vehicle in their possession. EVERY car that is manufactured with a satellite radio (whether Sirius or XM) becomes a subscriber at some point. Cars typically sit on a dealer lot for 60 days at the most. Many are sold within 30 days. This means that the un-activated radio is not being counted for a long period of time. Sirius is only counting three months of DCX vehicles in any given quarter. For example, the q1 2006 DCX cars counted as subscribers will be the DCX cars manufactured in January, February, and March. The bulk of these will be sold during the first quarter anyway. Those that do not sell in Q2 are not counted a second time in the second quarter. So, while some people like to make a big deal about this practice, on reality, the effect is very minimal. This is especially true when you consider that they will ALL become subscribers any way. The structure of the practice has been fully disclosed by Sirius, and is well known. Analysts, and other professionals are well aware of the practice, and have not taken exception to it. The link to this write up is - http://satellitestandard.blogspot.com/2006/03/sirius-oem-count.html3/30/2006 09:38:00 PM
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Wednesday, March 29, 2006 Sirius Executive Takes Position With MLB
On March 29, 2006, Sirius Satellite Radio announced that Edward Webber, Jr., Vice President, Controller, and Principal Accounting Officer resigned from his position at Sirius to take on the position of Senior Vice President and Chief Financial Officer with Major League Baseball Advanced Media. Sirius stated that David J. Frear, the Executive Vice President and Chief Financial Officer will serve as Principal Accounting Officer on an interim basis. The announcement came shortly after the closing bell, and stock fell .06 cents in after hours trading. The departure of Webber comes on the heels of the departure of an XM board member only a month ago. Realistically the move for Webber represents a move up the corporate ladder, and presents the opportunity to work for Major League Baseball. Sirius filed a form 8-K with the SEC that simply stated the date of the resignation, the appointment to the position with MLB, and the fact that Mr. Frear would assume some additional responsibilities on an interim basis. Some speculation may arise out of the resignation, but realistically, it would appear that Mr. Webber simply took a job that enables him to move upward on his career path. Link for this write-up http://satellitestandard.blogspot.com/2006/03/sirius-executive-takes-position-with.html3/29/2006 09:44:00 PM
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Sirius and Epcos Working Together
 Sirius and Epcos Working Together Although there is very little information available, we have confirmed that Sirius Satellite Radio has a relationship with Epcos, Inc. (symbol EPC), through the existence of a Non Disclosure agreement between the two companies. Earlier this year Epcos, Inc. http://www.usa.epcos.com/web/Default.aspx announced the development of a series of SAW filters for digital satellite radio systems and receivers. These filters can be used for home, vehicle and portable devices. SDARS units utilize several different IF SAW filters because of the diverse terrestrial and orbital paths of the satellites. The B170 IF series are designed for low insertion attenuation. The X730 series in a plastic case, and the B171 series in a ceramic SMD package are also utilized by SDARS. The extent of the Sirius and Epcos relationship is not known, but the existence of the relationship is not in question. The link for this writeup is - http://satellitestandard.blogspot.com/2006/03/sirius-and-epcos-working-together.html3/29/2006 10:49:00 AM
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Sprint to Step Up Music With Sirius
 Sprint is looking to take the next step. And partner Sirius Satellite Radio will help. Sprint is planning initiatives to boost its mobile music business in 2006 by offering a new subscription for downloading songs onto their cell phones. As part of this program Sprint is looking to expand the relationship it started with Sirius Satellite Radio in 2005. Sprint, currently the #3 carrier in the U.S. has looked to text messaging and other services such as music and video to increase its revenue, and boost the bottom line. Len Lauer, Chief Operating Officer of Sprint said, “We’d like to have the capability later this year that the customer listens to a song and says, ‘I want to buy that song.” Sprint stated that in the first three months of operations, that their music store sold over 1,000,000 sings. Sprint is already promoting the music aspect of their business on their web site http://www.sprint.com/The link to this write up is - http://satellitestandard.blogspot.com/2006/03/sprint-to-step-up-music-with-sirius.html3/28/2006 09:43:00 PM
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La Quinta and Sirius Team Up
 Sirius listeners may have heard some advertising from La Quinta Hotels recently. The relationship with La Quinta goes beyond simple ads on the radio. There are displays at La Quinta, and people who stay there are presented with chances to win Sirius units and subscriptions. You can register and enter at http://lq.eprize.net/siriuswin/Go ahead and enter......you have nothing to lose. The link for this write up is - http://satellitestandard.blogspot.com/2006/03/la-quinta-and-sirius-team-up.html3/28/2006 03:45:00 PM
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Maxim 100th Issue Celebration Contest
 There is only 1 day left to enter the Maxim Magizine 100th Issue Celebration Contest. All entries must be received by March 29th, 2006. You can enter at: http://www.sirius.com/servlet/ContentServer?pagename=Sirius/Page&c=Contest&cid=1139320919967"Want to party in Vegas with Maxim and the most beautiful women in the world? Maxim, Only Vegas and Maxim Radio, are giving you and a very lucky guest the shot to be at Maxim’s 100th Issue celebration weekend in Las Vegas. Grand prize includes round trip airfare for two, two nights at the Wynn Resort and tickets to Maxim’s exclusive weekend events. You’ll even get to hit the signature red carpet party." Go ahead and enter.....You have nothing to lose. The link to this write up is - http://satellitestandard.blogspot.com/2006/03/maxim-100th-issue-celebration-contest.html3/28/2006 03:32:00 PM
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Mel Karmazin To Speak At World Congress Of Sports
 The World Congess of Sports is taking place March 28, and March 29. Mel Karmazin will be speaking, and doing One-On-One interviews. http://www.sportsbusinessconferences.com/site/index.cfm?event=conference&conid=8Events such as this illustrate the commitment Sirius has in the sports segment of their content offerings. The link to this write up is - http://satellitestandard.blogspot.com/2006/03/mel-karmazin-to-speak-at-world.html3/28/2006 02:32:00 PM
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XACT NAVI
 XACT has developed a unit called the NAVI. This little unit is full of usable features. It has a Sirius ready DLP Interface to boot. Features include: -Internal Map Data for US/Canada -4" Touch Screen with Advanced User Interface -MP3 Music Player -Digital Photo Album Viewer -Sirius Ready DLP Interface* -iPod Auxiliary Audio Input or Output -Built-In Full Frequency Wireless FM Transmitter -Internal Speaker -IR Remote Control -FM Audio Output -4GB Internal Hard Drive -USB 1.1 Interface Paperwork for this unit has already been filed with the SEC. The link for this write up is - http://satellitestandard.blogspot.com/2006/03/xact-navi.html3/27/2006 10:52:00 PM
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Stern Suit
The CBS vs. Stern suit is being heard in front of Justice Gammerman CBS is represented byArnold & Porter LLP Stern is being represented byPryor Cashman Sherman & Flynn and Wachtell Lipton Rosen & Katz The preliminary Confernce was held March 22 The next scheduled activity is May 22 and is a Compliance Conference The link for this write up is - http://satellitestandard.blogspot.com/2006/03/stern-suit.html3/27/2006 09:12:00 PM
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Power Pod II - for XACT XTR8
 XACT seems to have a Power Pod II unit that will allow the XTR8, and likely the Starmate Replay to be taken on the go with live portable function. A release date has not yet been set for the unit. The link for this write up is - http://satellitestandard.blogspot.com/2006/03/power-pod-ii-for-xact-xtr8.html3/27/2006 08:52:00 PM
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BOOMCUBE - For Starmate Replay
 The long anticipated BoomCube for the Starmate Replay is due to hit store shelves quite soon. Channel checks with several retails indicate that this unit should be available for purchase in the first week or so of April. Those with Starmates Replays can now enjoy the sounds of Sirius via the four microdrivers plus a subwoofer. Starmates were a hot gift at Christmas. The BoomCube is sure to be a hot seller for Fathers Day. The link for this write up is - http://satellitestandard.blogspot.com/2006/03/boomcube-for-starmate-replay.html3/27/2006 08:37:00 PM
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Howard Stern Deal
There is a lot of speculation surrounding the Howard Stern deal. The deal boils down to this: 1. The deal is roughly $390,000,000 in cash over 5 years and 34,375,000 shares to be paid if certain pre-determined subscriber goals were reached. At the time of issue the shares were worth roughly $220,000,000.This put the value of the deal at about $610,000,000. 2. Details of the transaction can be viewed at http://www.shareholder.com/sirius/edgar.cfm Click on the 8k form filed January 5, 2006. 3. The shares were not a bonus. They were clearly identified as part of the base contract. The SEC filing states, "....Pursuant to our October 2004 agreement with Stern, we agreed to deliver these shares in December 2010, or earlier if as of the end of any fiscal year we exceeded agreed upon subscriber targets. Our December 31, 2005 subscriber total exceeded the subscriber target we agreed upon with Stern in October 2004." 4. The Howard Stern dealencompasses all of the talent, staff and programming on the Howard Stern streams. Shows such as Bubba The Love Sponge, Scott Ferrall, Howard 100 News, the staff, etc. are all part of the deal. 5. Sirius has stated that Stern can earn additional revenue, but stated that any additional revenue is tied to substantial targets.The link for this write up - http://satellitestandard.blogspot.com/2006/03/howard-stern-deal.html This write up contains factual information as well as opinions. Readers are encouraged to do their own research regarding these matters. If you have an opinion on this write up you can e-mail it to satellitestandard@gmail.com. Satellite Standards may elect to publish all or part of responses we receive.3/27/2006 04:45:00 PM
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Scott Ferrall To Join Sirius
 Today on the Howard Stern show it was announced that Scott Ferrall will be joining the Howard team with his own show. Ferralls show will be broadcast on Howard 101 and will likely follow Bubba The Love Sponge. Ferrall conducted a test run of his show a few weeks ago, and fans loved the show. Watch for updates. Scott's show to begin 3-27-06 at 8:00 PM eastern. The show will run Monday through Friday. 3/27/2006 10:18:00 AM
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Disclosure
Satellite Standard Group (SSG) and/or conributors to the content of Satellite Standard Group are not Financial Advisors. SSG fully recommends that readers consult a Certified Financial Planner prior to making any investment decisions. SSG and/or contributors to the content may have financial interests in some or all of the equites that are written about. 3/27/2006 12:02:00 AM
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Q1 Loss - Sirius
Q1 2006 LOSS
There is a lot of discussion about the Q1 2006 loss, and how big it is going to be. Let me first be very clear that ALL aspects of the loss need to be considered. It is very important to understand the components of a loss. This is especially true with the first quarter loss for Sirius. First I will address the analysts expectations. Analysts are expecting a loss of .34 cents per share in Q1. This represents a loss in the neighborhood of $473,000,000 for Sirius in the first quarter. This loss represents a big jump from both year over year, and quarter over quarter comparisons. One of the main reasons for the loss is that Sirius is taking the full value of the shares issued to Howard Stern in January in the first quarter. As part of the base contract between Sirius and Howard Stern, a bit over 34,000,000 shares were issued to Stern and his agent. The value of the shares at time of issue was about $220,000,000. The loss attributable to the Stern shares has a few components that need to be considered by those who follow this equity: 1. The loss attributable to the Stern shares in a ONE TIME EVENT. This means that this is not a regular expense to Sirius. Prudent investors should consider the full loss, but also look at the metrics of the company setting the loss aside. 2. The loss attributable to the Stern shares is a NON-CASH loss. This is another important item to note. Because Stern was issued shares, Sirius cash reserves are not impacted. This helps Sirius maintain a strong cash position as it moves towards cash flow break even. 3. The Stern shares represent 20% of the overall Stern deal. This represents another important factor for the balance sheet. At the end of 2006, Stern will have received about 38% of his overall compensation on the base deal. This means that the remaining 4 years will make up the balance of the deal. The costs in future quarters as well as years will not be as heavily impacted as Q1 and full year 2006. 4. The path that Sirius is taking is clearly illustrated in the projected loss for Q2, and for the full year of 2006. The Q2 loss is expected to be about $180,000,000. That is a sharp decline from the expected Q1 loss, and the reasons for that are outlined above, but are also attributable to the business plan moving in the right direction. The loss for the year is projected at about 1 billion. Thus, the largest component of the 2006 loss will be Q1. Revenues for the year are currently projected to be $600,000,000. I have used the following example to illustrate my sentiments on how to look at the loss. If in Q2 of this year, Sirius were to sell their stake in Sirius Canada to the partners in Canada for $220,000,000 the bottom line in Q2 would be impacted by a revenue gain of $220,000,000. The expected loss in Q2 is about $180,000,000. Such a gain would wipe out that loss, and Sirius could actually show and report a profit for the quarter. Like the Stern situation above, this gain would be a ONE TIME event. A prudent person would consider that revenue, but would also know to set it aside when trying to determine the outlook for the company. The key here is to get beyond the “headline” of the loss, and understand the components of it. I am not saying to pretend that the one time loss does not exist. I am simply saying that you need to look deeper into the loss and understand it more fully. The link to this write up is - http://satellitestandard.blogspot.com/2006/03/q1-loss-sirius.htmlThis write up contains opinions on issues as well as factual data. Readers of this are fully encouraged to conduct their own research into this issue. The opinions contained in this document are the sole opinions of the writer, and do not reflect the sentiments of any companies an/or industries discussed. 3/26/2006 10:52:00 PM
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Satellite Insurance
SATELITE INSURANCE In August of 2004 Sirius discontinued their in orbit satellite insurance. This is not a light decision to make. Satellite radio is dependent upon the satellites to deliver their product. A problem with a satellite would cause a disruption to the service that Sirius offers. Investors should be aware of the fact that Sirius does not carry in orbit insurance, but they should also be aware as to why that decision was made. The decision was a business decision. “In Orbit” satellite insurance premiums have sky-rocketed in recent years. Not only have the premiums risen, but the items covered under such policies narrowed. Sirius, and several other companies began to take a closer look at the policies and the coverage offered under those policies. Certain items such as “Acts of God” are not covered. The riskiest part of satellite use is in the launch of the satellite and the setting of the orbit. After that, the first year will typically identify any problems that the satellites will have. One you get beyond the first year of use, the risk factors drop substantially. Sirius already has a spare satellite on the ground. This satellite is already paid for. Sirius is also actively pre-paying for a launch vehicle. This means that Sirius is not operating “nakedly” with regards to the satellite issue. They have back-ups in place that are substantially paid for. By pre-paying for the launch vehicle, Sirius has afforded itself the right to launch any time between now and 2010. Should Sirius lose 1 of their 3 orbiting satellites, they can “tweak” things so that the down time is limited to about 6 hours in the middle of the night while they get the spare satellite launched. There are several companies in the same situation as Sirius. Other companies have also opted to discontinue their In Orbit insurance. Sirius is not being a maverick with regards to this decision. Sirius likely saves about $6,000,000 per year by electing not to purchase commercial insurance for their constellation. A new satellite runs about $150,000,000. Here is a link that discusses the satellite insurance issue. http://www.solarstorms.org/Sinsurance.htmlThe satellite insurance issue is complex. Yes, there are risks involved, but they may or may not be as substantial as people think. The key is in understanding the whole issue. Sirius has disclosed that there have been some circuit failures on their satellites. These failures have not compromised Sirius’ ability to offer their service, and the satellites are expected to run their full operational life of about 15 years. The satellites were launched in late 2000 and thus are expected to last until 2015. The link to this write up is - http://satellitestandard.blogspot.com/2006/03/satellite-insurance.htmlThis write up contains opinions on issues as well as factual data. Readers of this are fully encouraged to conduct their own research into this issue. The opinions contained in this document are the sole opinions of the writer, and do not reflect the sentiments of any companies an/or industries discussed. 3/26/2006 10:49:00 PM
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Welcome
Welcome........This site was created for the purpose of sharing information and opinions relating to the satellite radio industry as well as any other relating items. Stay tuned for updates and more3/26/2006 10:12:00 PM
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