February NPD Data Released

Labels: npd, retail share, sirius, xm

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THE Canadian Factor

February 14, 2007

With the news from Sirius Canada being announced today, investors in Sirius Satellite Radio should begin to look more closely at the business north of the border. The reason is simple. There will come a day when Sirius Canada contributes to the bottom line of Sirius Satellite Radio, and given the fast start up north, that day may come sooner than many people realize. It wont be this quarter, and maybe not next quarter, but the day is coming. If 300,000 subscribers have an ARPU of $10 each, then Sirius Canada is bringing in $3,000,000 per month. As the base grows, the revenue will as well.

Consider that Sirius Canada did not have about 1 billion dollars worth of satellites to launch. Consider that the repeater network in Canada is quite small. Consider that the bulk of content is already paid for. Consider that the marketing efforts up north benefit greatly from what happens here in the U.S.

Simply stated, the operations costs of Sirius Canada are a stark difference from Sirius Satellite Radio stateside. Now think about the fact that Sirius Satellite Radio gets about half of the Sirius Canada pie.

Many analyst models do not even consider Sirius Canada in their projections. The costs are not big, and at this point neither is the revenue, but people should begin to think a couple of years down the road, and what the business north of the border will be contributing to the bottom line of this equity. Perhaps some early projections are now warranted.

The same would seem to hold true for XM satellite Radio, but their road to riches seems to be a bit further off at this point, and XM's ownership in the Canadian counterpart is not as substantial as Sirius’.

Some pretty interesting data was announced today, and it is compelling enough that it ought not be ignored. Since January 2006 Sirius Canada has garnered a 75% retail share according to NPD, and more impressively, brought in almost 80% in December of 2006. These statistics are quite telling. There seems to be an obvious choice being made by Canadian consumers. Even more note worthy is the fact that Sirius Canada has been the more expensively priced service during this time period (the services now have identical pricing for the first subscription).

There are several reasons that investors stateside should begin to watch the Canadian counterparts closely:

1. The services launched at virtually the same time, thus the subscriber comparison metric is not skewed.

2. The retail channel, according to NPD, is seeming to show a clear preference. How will advertisers react to this news? OEM's? potential on air talent?

3. The Canadian companies will be contributing to the bottom line of Sirius as well as XM at some point. The faster that happens, the faster a surprise in the revenue line will hit these stocks. XM Canada is publicly traded, and various reporting is required. In the case of Sirius Canada, it is private. The financials are not disclosed. This means that the Canadian factor will come as more of a surprise to the street when it happens.

For their part, XM Canada has announced several OEM deals in Canada, and similar to stateside claims a big advantage in that area. However, we have covered the perception vs. reality of the OEM world in the past, and that channel boils down to the number of installs, the cost of those installs, the take rate, and what kind of revenue these companies get to keep (revenue share). It comes down to whether retail fuels OEM, or whether OEM will be the dominating force. The answer to this type of question may well be already available. How many "Factory Installed I-Pods" have you seen? how many I-Pods come from retail?

In the end it boils down to one thing. Which company offers the content that consumers want?

Labels: npd, sirius, sirius canada, xm, xm canada

2/13/2007 11:55:00 PM

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Sirius Canada Passes 300,000 Subscribers

February 13, 2007

SIRIUS Canada Adds 100,000 New Subscribers Over Holiday Season

* SIRIUS Canada Surpasses 300,000 Paying Subscribers
* SIRIUS Leads Industry in Canada with 78 per cent Market Share

TORONTO, Feb. 13 /PRNewswire-FirstCall/ -- SIRIUS Canada Inc., Canada's fastest growing satellite radio provider with 110 full-time channels, announced today that it has surpassed 300,000 paying subscribers nationwide, with more than 100,000 of those subscribers joining since November 22, 2006.

Source: SIRIUS Satellite Radio

During the 2006 holiday season, more than 3,500 retail locations throughout Canada were fully stocked with SIRIUS' latest plug-and-play and portable radios including the Sportster 4 and cutting-edge Stiletto 100. According to independent retail tracking research provided by the NPD Group, SIRIUS was the preferred choice for satellite radio this holiday season with nearly 8 out of 10 satellite radio shoppers choosing SIRIUS in December. Since January 2006, SIRIUS has led the satellite radio industry in Canada with 75 per cent market share, within NPD's measured channels.*

"Surpassing 300,000 paying subscribers in such a short time confirms the demand for and strength of SIRIUS' programming, signal coverage, and innovative products," said Mark Redmond, President and CEO, SIRIUS Canada Inc. "SIRIUS' depth and breadth of programming resonates with Canadians and we are proud to be the country's undisputed satellite radio leader. This is a tremendous accomplishment for SIRIUS Canada and as we continue to build our business and extend our offerings, we look forward to sharing in future success with our customers and our retail and automotive partners."

In addition to success at retail, SIRIUS continues to partner with leading automotive brands across Canada. More than 150 vehicle models are expected to be available in 2007 with SIRIUS Satellite Radio receivers either factory or dealer-installed in Audi, Aston Martin, BMW, Chrysler, Dodge, Ford, Jaguar, Jeep, Land Rover, Lincoln, Subaru, Volkswagen and Volvo vehicles

SIRIUS maintains its leadership in the Canadian satellite radio market with an extensive, full-time 110-channel lineup offering the very best in news, talk, sports and commercial-free music programming. With exclusive and unique entertainment programming ranging from Blue Collar Comedy and NASCAR Radio to the recently added Siriusly Sinatra and Metropolitan Opera Radio channels, SIRIUS offers an unrivaled entertainment experience.

In addition, through exclusive sports partnerships with North America's major professional sports leagues including CFL, NFL, NLL, NBA and NASCAR, SIRIUS also offers fans the most in-depth sports coverage anytime, anywhere.

About SIRIUS Canada

From broadcast studios in Vancouver, Toronto, Montreal and New York, SIRIUS Canada delivers 110 premium channels of the best music, sports, news, talk and entertainment programming. With a total of 65 music channels - the most in Canada - SIRIUS is the original and only home of 100% commercial-free music and offers the broadest range of Canadian content on satellite radio with 11 English and French channels. SIRIUS is Canada's satellite radio sports leader and is the Official Satellite Radio Partner of the CFL, NHL, NFL, NLL, NBA and NASCAR and broadcasts live play-by-play games of the CFL, NHL, NFL, NLL and NBA. In addition, SIRIUS Satellite Radio is home to broadcasts of U.S. College Football and English Premier League Soccer.

In Canada, SIRIUS' automotive partners include Audi, Aston Martin, BMW, Chrysler, Dodge, Ford, Jaguar, Jeep, Land Rover, MINI, Lincoln, Pana-Pacific, Subaru, Volkswagen and Volvo.

For additional details on SIRIUS Canada, please visit: www.siriuscanada.ca

* NPD-measured channels do not include certain retail channels like Club
Stores or OEM or Aftermarket Installers; for more information see
www.npd.com.

Labels: npd, sirius, sirius canada, subscribers

2/13/2007 10:53:00 PM

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Morgan Stanley Comments on Retail Share

January 18, 2007

Labels: morgan stanley, npd, retail, sirius

1/18/2007 09:23:00 AM

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The Stern Effect - Alive and Well

January 17, 2007

The Stern Effect was a hot topic of discussion a year ago. Stern had just started with Sirius, and many were trying to determine what type of effect his arrival would have on Sirius.

The detractors said the Stern effect would be short lived and that it would be over in January. January 2006 passed, and Sirius reported a 66% NPD share, up an impressive 24 points from January 2005. "Surely this is the end", the detractors were heard to say, "Stern brought everyone he is going to bring in December and January."

February 2006 NPD came in and Sirius carried a 56% NPD share. The Stern detractors saw this as confirmation that indeed the Stern Effect was short lived. They neglected to consider that February 2006 represented an 18 point jump from February 2005.

March 2006 was much the same. Sirius garnered a 56% share, and the detractors raised their fists in the air in a sign of victory citing that indeed the Stern Effect was dead. It was the second wave of proclamation of the demise of Stern, but that did not matter to them. All that mattered was that in their mind the Stern Effect was dead.

April 2006 brought another feather into the cap for the "Stern Effect Is Dead" crowd. Sirius NPD retail share dropped by 2 points to 54%. Once again, these people shouted that the Stern Effect was dead. Now, for the third time, they were proclaiming their same mantra, oblivious to the fact that Sirius was still well above the prior years April numbers, and ignoring the fact that Sirius was maintaining an NPD advantage.

In May 2006, the Stern detractors saw the 54% NPD retail share as sure and solid confirmation that whatever Stern was going to deliver to Sirius has already happened. The Stern Effect is dead they proclaimed. "Look at the market share" they touted. It went from 66% to 56% to 54%....It is dropping, and will continue to drop until the share reverts back to previous levels.

Then came June 2006 and the first big holiday in the world of satellite radio (Fathers Day). Sirius came in with an NPD share at 61%. Those that called the Stern Effect dead for the four previous months were perplexed. It appeared that Howard Stern had more lives than the famous Montey Python's Black Knight! "Surely there was some explanation" they thought. It could not possibly be Howard Stern, after all, they had proclaimed his influence dead four previous times.

July 2006 brought about a 58% share. Three points less than June. The detractors now came up with their reasoning. "The Fathers day sales the month prior are mostly for men, and Sterns audience is mostly men, and thus the 61% in June 2006 was an aberration, and clearly we can see that market share will once again fall off for Sirius, because after all, the Stern Effect is dead."

August 2006 showed a Sirius NPD share of 55%. The detractors once again celebrated. This drop in market share shows quite clearly that the Stern Effect is dead. The last six times were crystal clear, but this 55% market share is crystal-crystal clear. The Stern Effect is dead.

September 2006 saw Sirius’ NPD share rise to 57%. The detractors were once again perplexed. There had to be some other reason besides Stern that the share jumped. After all, it could not be Stern, the Stern Effect has been confirmed as dead since February. Perhaps the new radios accounted for the bump in share, or people got the Oprah Effect and the Stern Effect confused.

October 2006 brought a dip in Sirius NPD share to 56%. The detractors jumped for joy. Surely the Stern Effect is dead. Sirius Internet Radio had the widely promoted free weekend and Stern was a big part of it! All that marketing and Sirius lost a point in retail. This became the crystal-crystal-crystal clear indicator that the Stern Effect was dead. Somehow the Stern detractors failed to consider that the Sirius Internet Radio promotion took place at the end of the month, and the retail spike would follow the promotion, but might I digress.

November 2006 brought with it a 59% NPD share for Sirius. Their highest level since June and the Fathers Day push. "It’s inconceivable" the perplexed detractors spoke much like Vizzini in The Princess Bride, but the message was not as strong as it had been. Shouts of the Stern Effect being dead turned into mumbles that did not seem to have passion. November 2006 was two points lower than November 2005, but that is not much consolation after months of speaking so strongly that the Stern Effect was dead all year long.

Now the December 2006 NPD numbers are out. Sirius' share came in at 66%, matching that of January 2006, and actually four points higher than December of 2005 when Stern Fever was everywhere. What do we have?

SILENCE FROM THE DETRACTORS.

The numbers have spoken for themselves. It is crystal clear that the arrival of Stern has caused a shift not only in satellite radio, but in content challenged terrestrial radio as well. Sirius market share at retail continues to climb, as does their overall market share. Ratings for terrestrial radio continue to slump, and formats seem to shift as often as the seasons.

What is now known by most everyone is that the Stern Effect was much greater and longer lasting than the detractors thought. The Stern Effect is not a one time thing. The Stern Effect is about the most well known radio personality calling Sirius home. It is about brand awareness. It is about cross promotion. Sterns Effect is far greater than channel 100 and channel 101. Stern's Effect impacts other aspects of Sirius. Be it news, sports programming or womens programming, Stern brought the Sirius brand to the forefront, and the entire Sirius line-up benefits from it.

The Stern Effect is here, it has been planted, and will continue to grow. It is CRYSTAL-CRYSTAL-CRYSTAL CLEAR. With that established, lets move on to the on again off again merger speculation………sorry, that is another article altogether.

Labels: npd, retail, sirius, stern, stern effect

1/18/2007 12:25:00 AM

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December NPD Released

December 2006 retail sales, as tracked by NPD, for satellite radio have come in (Click Chart To Enlarge). For the month of December Sirius Satellite Radio Satellite Radio picked 7 points in share over last month, finishing with a 66% NPD share for December 2006. This represents 16 consecutive months that Sirius has outperformed XM in NPD tracking.

Overall, year over year (December 2006 compared to December 2005) sales showed a decline. The sector saw a decline of 46%, with XM seeing a 55% decline vs. 40% for Sirius.

For the quarter the share was 63% for Sirius vs. 37% for XM

Year to date the retail share finished with Sirius at 60% vs. 40% for XM.

Overall, 2006 NPD tracked sales were off last years pace by 18.5% as compared to 2005. Sirius NPD tracked sales fell off the 2005 pace by 11.6%. For XM the fall off was 28%.

Labels: npd, retail sales, sirius, xm

1/17/2007 03:25:00 PM

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