Tuesday, December 19, 2006

Motley Fool On Satellite Radio Today

Satellite Radio's Grinchy Holiday
Rick Aristotle Munarriz, The Motley Fool, December 19, 2006

'Twas the week before Christmas, When all through the store, Not a sat-rad receiver, Was sold off the floor...
This won't be much of a holiday to remember for satellite radio. Sirius (NASDAQ: SIRI) and XM Satellite Radio (NASDAQ: XMSR) have already lowered previous year-end subscriber targets, and weakness on the retail front is to blame.
Retail sales of satellite radios have fallen for three consecutive months through October. The momentum is apparently not improving as we dig into the critical holiday selling season.
In addressing the crowd at the Credit Suisse Media & Telecom Week conference earlier this month, XM Chairman Gary Parsons was realistic in his assumptions. His company's channel-checks through consumer-electronics stores found that retailers were looking at 5% improvement in comps, but satellite-radio sales were yielding to other big-ticket items, such as high-def televisions and next-generation game consoles.
Some of you weren't convinced. "No consumer is trying to decide between buying a flat-panel TV or XM radio," one Fool wrote me. "It costs about $1,000 to $2,000 for a flat-panel TV, and about $50 for an XM radio. The comparison is absurd."...read more: here

12/19/2006 03:15:00 PM

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