Tuesday, May 22, 2007

Sirius Redundancy

May 22, 2007

Tyler Savery

With XM’s service being down, many are likely wondering if something similar can happen to Sirius. Like anything technical, the answer is not always easy, but here are a few things investors in this sector can think about.

1. The orbits of the satellites of Sirius and XM differ. XM’s satellites sit lower on the horizon, are stationary, and are “always on” (meaning that they are always delivering signal for consumers). Sirius’ three satellites are at a higher elevation and run in an elliptical orbit. Two of the satellites are always delivering service, and a third stops delivering service when its path takes it over south America.

2. Each system has its advantages and disadvantages.

3. XM runs their repeater network off of the XM#3 satellite. A failure in that satellite also creates a failure in the repeater network. This is what has happened. XM fields a larger repeater network than Sirius.

4. Sirius runs their repeaters off of a non-Sirius satellite. They lease “satellite space” from an outside company, and that is where the repeaters get their signal.

5. If XM needs to do updates on a satellite, they must do so while the satellite is “live and operational” (delivering content to the consumer).

6. Sirius’ orbital path basically takes a satellite “off-line” for an 8 hour period each day. This allows maintenance to happen when the satellite is not being used to deliver content to consumers.

7. If Sirius were to lose signal from 1 of the three satellites, the orbits of the remaining 2 satellites could be adjusted to minimize outages or service interruptions.

8. Sirius has a fully paid for spare satellite on the ground. Should there be a satellite failure, they would need to schedule a launch. As a side note, Sirius has already contracted and paid for the launch vehicle as well.

The key in a satellite delivered system is redundancy. Redundancy allows for a hic-up to happen without an interruption, or at least a very limited interruption to the consumer. There are some substantial differences in how Sirius and XM accomplish redundancy.

In a nutshell, the question as to whether a similar situation could impact Sirius rests with what types of problems happen. Having an 8 hour window to maintain a satellite each day has some advantages. They are not trying to work on a “live satellite”. Now, as a disclaimer, I am not a satellite engineer, nor a “rocket scientist”, and encourage those with knowledge relating to the subject to comment. The point is that there exists some redundancy that investors may not be aware of, and there are differences between the two systems.

Position – Long Sirius, Long XM

5/22/2007 11:52:00 AM

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