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Satelite radio losses increase
- Thread starter radioray
- Start date
M
Mediafrog
Guest
Re: Satellite radio losses increase
Anyone want to start the merger speculation rolling again? And would it be XM and Sirius, or would players like Music Choice, DMX, or Muzak come into the picture?
Anyone want to start the merger speculation rolling again? And would it be XM and Sirius, or would players like Music Choice, DMX, or Muzak come into the picture?
Re: Satellite radio losses increase
> Anyone want to start the merger speculation rolling again?
> And would it be XM and Sirius, or would players like Music
> Choice, DMX, or Muzak come into the picture?
>
I don't think XM and Sirius can merge due to FCC and FTC restrictions.
-A<P ID="signature">______________
</P>
> Anyone want to start the merger speculation rolling again?
> And would it be XM and Sirius, or would players like Music
> Choice, DMX, or Muzak come into the picture?
>
I don't think XM and Sirius can merge due to FCC and FTC restrictions.
-A<P ID="signature">______________
</P>
Re: Satellite radio losses increase
> I don't think XM and Sirius can merge due to FCC and FTC
> restrictions.
>
> -A
That's what I'm thinking. Plus the Justice Department would have to sign off on it. They'd likely view is as a satellite radio monopoly rather a company with a sliver of radio listening.
Someday they may be allowed to merge if it becomes apparent that it isn't viable the way it is. That day is down the road if it ever comes at all.<P ID="signature">______________
SD</P>
> I don't think XM and Sirius can merge due to FCC and FTC
> restrictions.
>
> -A
That's what I'm thinking. Plus the Justice Department would have to sign off on it. They'd likely view is as a satellite radio monopoly rather a company with a sliver of radio listening.
Someday they may be allowed to merge if it becomes apparent that it isn't viable the way it is. That day is down the road if it ever comes at all.<P ID="signature">______________
SD</P>
but i thought that satelite radio was the end of traditional radio?
K
KMRichards
Guest
> but i thought that satelite radio was the end of traditional
> radio?
See what listening to clueless people gets you?
Every thread, on every board, that has said "satellite will kill terrestrial" was rebutted with facts, but the overly emotional satellite proponents have kept ignoring those facts and continued to foresee doom.
The press link that started this thread contains many of the same facts that the knowledgeable among us have been quoting for some time.
Satellite radio is expensive, it is dependent on a subscriber model rather than advertising, and it requires an investment by the users in equipment which cannot be used for anything else.
Terrestrial radio has no monthly charge, receivers are available inexpensively, and still has the vast majority of the radio listening audience.<P ID="signature">______________
</P>
> radio?
See what listening to clueless people gets you?
Every thread, on every board, that has said "satellite will kill terrestrial" was rebutted with facts, but the overly emotional satellite proponents have kept ignoring those facts and continued to foresee doom.
The press link that started this thread contains many of the same facts that the knowledgeable among us have been quoting for some time.
Satellite radio is expensive, it is dependent on a subscriber model rather than advertising, and it requires an investment by the users in equipment which cannot be used for anything else.
Terrestrial radio has no monthly charge, receivers are available inexpensively, and still has the vast majority of the radio listening audience.<P ID="signature">______________
</P>
Re: Satellite radio losses increase
> > I don't think XM and Sirius can merge due to FCC and FTC
> > restrictions.
> >
> > -A
>
> That's what I'm thinking. Plus the Justice Department would
> have to sign off on it. They'd likely view is as a satellite
> radio monopoly rather a company with a sliver of radio
> listening.
>
> Someday they may be allowed to merge if it becomes apparent
> that it isn't viable the way it is. That day is down the
> road if it ever comes at all.
>
While this is off-subject, the Justice Dept. didn't allow Echostar (parent company of Dish Network) to buy out DirecTV because in a number of rural areas, Dish Network would have been a monopoly. You won't see any of the 4 major networks allowed to merge with each other either.
> > I don't think XM and Sirius can merge due to FCC and FTC
> > restrictions.
> >
> > -A
>
> That's what I'm thinking. Plus the Justice Department would
> have to sign off on it. They'd likely view is as a satellite
> radio monopoly rather a company with a sliver of radio
> listening.
>
> Someday they may be allowed to merge if it becomes apparent
> that it isn't viable the way it is. That day is down the
> road if it ever comes at all.
>
While this is off-subject, the Justice Dept. didn't allow Echostar (parent company of Dish Network) to buy out DirecTV because in a number of rural areas, Dish Network would have been a monopoly. You won't see any of the 4 major networks allowed to merge with each other either.
R
radiodial
Guest
> but i thought that satelite radio was the end of traditional
> radio?
>
Not the end of the whole, but the end for where people go to find their music. Traditional radio is losing that and will never get it back.
If you note from the article, it says revenues have more than doubled and the market is growing rapidly. The losses are from heavy capital investement in new technologies. That in itself is not a bad type of loss. It's just growing pains as they expand so quickly. Gotta spend money to make money -- sort of thing.
JMHO
> radio?
>
Not the end of the whole, but the end for where people go to find their music. Traditional radio is losing that and will never get it back.
If you note from the article, it says revenues have more than doubled and the market is growing rapidly. The losses are from heavy capital investement in new technologies. That in itself is not a bad type of loss. It's just growing pains as they expand so quickly. Gotta spend money to make money -- sort of thing.
JMHO
M
Mediafrog
Guest
Re: Satellite radio losses increase
> I don't think XM and Sirius can merge due to FCC and FTC
> restrictions.
If either XM or Sirius pulls the plug, the FCC and FTC will have a monopoly on their hands whether they like it or not. The real competition arena here is satellite vs. standard FM and AM broadcasters. This may be a case where there's room for only one player on satellite, or the entire business/distribution model gets overhauled.
> I don't think XM and Sirius can merge due to FCC and FTC
> restrictions.
If either XM or Sirius pulls the plug, the FCC and FTC will have a monopoly on their hands whether they like it or not. The real competition arena here is satellite vs. standard FM and AM broadcasters. This may be a case where there's room for only one player on satellite, or the entire business/distribution model gets overhauled.
JeeperOne
Banned
Re: Satellite radio losses increase
Hi everyone:
> > Anyone want to start the merger speculation rolling again?
>
> > And would it be XM and Sirius, or would players like Music
>
> > Choice, DMX, or Muzak come into the picture?
> >
>
> I don't think XM and Sirius can merge due to FCC and FTC
> restrictions.
They probably could if they got rid of the redundant channel allocations (i.e. only one channel allocation per network on the new joint service).
JMHO though
Cheers
Pat<P ID="signature">______________
http://patspodcast.blogspot.com/
Radio? Uhh.....What's THAT??</P>
Hi everyone:
> > Anyone want to start the merger speculation rolling again?
>
> > And would it be XM and Sirius, or would players like Music
>
> > Choice, DMX, or Muzak come into the picture?
> >
>
> I don't think XM and Sirius can merge due to FCC and FTC
> restrictions.
They probably could if they got rid of the redundant channel allocations (i.e. only one channel allocation per network on the new joint service).
JMHO though
Cheers
Pat<P ID="signature">______________
http://patspodcast.blogspot.com/
Radio? Uhh.....What's THAT??
</P>Re: Satelite radio losses increase (Accounting Question)
Losses are not recognized immediately when there is a Capital Expenditure. The Expenditure is depreciated over its useful life or depreciated according to IRS guidlines. There are choices. But a loss is not recognized. So why is anyone even writing about losses?
I assume that there are losses. In other words, expenses, which include depreciation exceed revenue. No one is going to account for Capital Expenditures in the profit and loss of a single accounting period.
Check out their income statements and see.
> > but i thought that satelite radio was the end of
> traditional
> > radio?
> >
>
> Not the end of the whole, but the end for where people go to
> find their music. Traditional radio is losing that and will
> never get it back.
>
> If you note from the article, it says revenues have more
> than doubled and the market is growing rapidly. The losses
> are from heavy capital investement in new technologies.
> That in itself is not a bad type of loss. It's just growing
> pains as they expand so quickly. Gotta spend money to make
> money -- sort of thing.
>
> JMHO
>
<P ID="signature">______________
[email protected]</P>
Losses are not recognized immediately when there is a Capital Expenditure. The Expenditure is depreciated over its useful life or depreciated according to IRS guidlines. There are choices. But a loss is not recognized. So why is anyone even writing about losses?
I assume that there are losses. In other words, expenses, which include depreciation exceed revenue. No one is going to account for Capital Expenditures in the profit and loss of a single accounting period.
Check out their income statements and see.
> > but i thought that satelite radio was the end of
> traditional
> > radio?
> >
>
> Not the end of the whole, but the end for where people go to
> find their music. Traditional radio is losing that and will
> never get it back.
>
> If you note from the article, it says revenues have more
> than doubled and the market is growing rapidly. The losses
> are from heavy capital investement in new technologies.
> That in itself is not a bad type of loss. It's just growing
> pains as they expand so quickly. Gotta spend money to make
> money -- sort of thing.
>
> JMHO
>
<P ID="signature">______________
[email protected]</P>
Re: Satellite radio losses increase
I think a merger or consolidation is more likely than one company walking away from an investment.
> > I don't think XM and Sirius can merge due to FCC and FTC
> > restrictions.
>
> If either XM or Sirius pulls the plug, the FCC and FTC will
> have a monopoly on their hands whether they like it or not.
> The real competition arena here is satellite vs. standard FM
> and AM broadcasters. This may be a case where there's room
> for only one player on satellite, or the entire
> business/distribution model gets overhauled.
>
<P ID="signature">______________
[email protected]</P>
I think a merger or consolidation is more likely than one company walking away from an investment.
> > I don't think XM and Sirius can merge due to FCC and FTC
> > restrictions.
>
> If either XM or Sirius pulls the plug, the FCC and FTC will
> have a monopoly on their hands whether they like it or not.
> The real competition arena here is satellite vs. standard FM
> and AM broadcasters. This may be a case where there's room
> for only one player on satellite, or the entire
> business/distribution model gets overhauled.
>
<P ID="signature">______________
[email protected]</P>
Re: Satelite radio losses increase (Accounting Question)
> Losses are not recognized immediately when there is a
> Capital Expenditure. The Expenditure is depreciated over
> its useful life or depreciated according to IRS guidlines.
> There are choices. But a loss is not recognized. So why is
> anyone even writing about losses?
These are operating losses, mostly comeing from content costs and the costs of getting each subscriber, and which exceed the revenues from subscribers.
>
> I assume that there are losses.
Again, the press is very bad on financial reporting. they confused profit with income, etc. the 5 years of XM loses are based on operating losses, plus interes, amortizationa and depreciation. The satellites have a very short useful life, relative to cost, so the depreciation is hight.
> In other words, expenses,
> which include depreciation exceed revenue. No one is going
> to account for Capital Expenditures in the profit and loss
> of a single accounting period.
They will account for the depreciation corresponding to that perdiod. If there are $800 million worth of satellites, and the useful life is 8 years, the depreciation on a straight line basis is going to be $20 million a quarter.
But most of the losses are in subscriber acquisition and programming and content costs plus interst on the debt.
> Losses are not recognized immediately when there is a
> Capital Expenditure. The Expenditure is depreciated over
> its useful life or depreciated according to IRS guidlines.
> There are choices. But a loss is not recognized. So why is
> anyone even writing about losses?
These are operating losses, mostly comeing from content costs and the costs of getting each subscriber, and which exceed the revenues from subscribers.
>
> I assume that there are losses.
Again, the press is very bad on financial reporting. they confused profit with income, etc. the 5 years of XM loses are based on operating losses, plus interes, amortizationa and depreciation. The satellites have a very short useful life, relative to cost, so the depreciation is hight.
> In other words, expenses,
> which include depreciation exceed revenue. No one is going
> to account for Capital Expenditures in the profit and loss
> of a single accounting period.
They will account for the depreciation corresponding to that perdiod. If there are $800 million worth of satellites, and the useful life is 8 years, the depreciation on a straight line basis is going to be $20 million a quarter.
But most of the losses are in subscriber acquisition and programming and content costs plus interst on the debt.
> > but i thought that satelite radio was the end of
> traditional
> > radio?
> >
>
> Not the end of the whole, but the end for where people go to
> find their music. Traditional radio is losing that and will
> never get it back.
>
> If you note from the article, it says revenues have more
> than doubled and the market is growing rapidly. The losses
> are from heavy capital investement in new technologies.
The losses are from operating expences and the interest on debt and depreciation of the technology. The satellites were put up 5 years ago... there is no investment in new technology, just maintenance of the existing one.
> traditional
> > radio?
> >
>
> Not the end of the whole, but the end for where people go to
> find their music. Traditional radio is losing that and will
> never get it back.
>
> If you note from the article, it says revenues have more
> than doubled and the market is growing rapidly. The losses
> are from heavy capital investement in new technologies.
The losses are from operating expences and the interest on debt and depreciation of the technology. The satellites were put up 5 years ago... there is no investment in new technology, just maintenance of the existing one.
Re: Satellite radio losses increase
> > I don't think XM and Sirius can merge due to FCC and FTC
> > restrictions.
>
> If either XM or Sirius pulls the plug, the FCC and FTC will
> have a monopoly on their hands whether they like it or not.
Neither is going to pull the plug as long as they can use equity financing for the losses.
> > I don't think XM and Sirius can merge due to FCC and FTC
> > restrictions.
>
> If either XM or Sirius pulls the plug, the FCC and FTC will
> have a monopoly on their hands whether they like it or not.
Neither is going to pull the plug as long as they can use equity financing for the losses.
R
radiodial
Guest
>
> The losses are from operating expences and the interest on
> debt and depreciation of the technology. The satellites were
> put up 5 years ago... there is no investment in new
> technology, just maintenance of the existing one.
>
From the article:
"Both XM and Sirius are growing rapidly in a nascent market, but losing money as they spend heavily on technology and entertainment..."
> The losses are from operating expences and the interest on
> debt and depreciation of the technology. The satellites were
> put up 5 years ago... there is no investment in new
> technology, just maintenance of the existing one.
>
From the article:
"Both XM and Sirius are growing rapidly in a nascent market, but losing money as they spend heavily on technology and entertainment..."
> >
> > The losses are from operating expences and the interest on
>
> > debt and depreciation of the technology. The satellites
> were
> > put up 5 years ago... there is no investment in new
> > technology, just maintenance of the existing one.
> >
>
> From the article:
>
> "Both XM and Sirius are growing rapidly in a nascent market,
> but losing money as they spend heavily on technology and
> entertainment..."
Articles are often wrong. There is little (compatitive) expenditure on technology. It is all on the programming and acquiring new subscribers.
>
> > The losses are from operating expences and the interest on
>
> > debt and depreciation of the technology. The satellites
> were
> > put up 5 years ago... there is no investment in new
> > technology, just maintenance of the existing one.
> >
>
> From the article:
>
> "Both XM and Sirius are growing rapidly in a nascent market,
> but losing money as they spend heavily on technology and
> entertainment..."
Articles are often wrong. There is little (compatitive) expenditure on technology. It is all on the programming and acquiring new subscribers.
>
M
MrMissRadio
Guest
It should also be considered that 3 million XM's radios are in GM vehicles and 550K in Hondas (Toyotas to come) that are sold with the first year prepaid. Sirius has agreements with Chrysler, Ford and Nissan. The satellite radio companies really have their fingers crossed that those subscribers re-up after the first year. It's almost a Ponzi game with GM putting another 1.5M on the road this year.
XM is already partly owned by GM (15%, I think) and Honda (a lesser amount I think). Not sure about Sirius. I won't be surprised if the car companies buy them and try to get a cash flow like On Star.
XM is already partly owned by GM (15%, I think) and Honda (a lesser amount I think). Not sure about Sirius. I won't be surprised if the car companies buy them and try to get a cash flow like On Star.
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