A FishbowlLA first: A no-pun headline involving “Sirius” losses

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A day after a board director at XM quit and warned of a “significant chance of a crisis on the horizon” due to unchecked spending, its rival Sirius announced a fourth-quarter net loss of $311 million dollars.

As dizzying as the losses are at these companies, their subscriber growth is just as jaw-dropping: Sirius ended 2005 with 3.3 million subscribers, after gaining 1.1 million in the fourth quarter. Sirius also said it expects to double its subscriptions this year to 6 million.

Confused?

So were we, until we discovered more helpful numbers.

As Reuters points out deep into its piece today, “Sirius said the cost of adding new subscribers, or subscriber acquisition costs, was $113 per subscriber for the fourth quarter and $139 for the year, below its forecast of $145 for 2005. By contrast, cost per user at XM, which launched its service one year ahead of Sirius, was $89 in the quarter, though that was up 39 percent from the previous year.” karmazin_sirius_satellite.jpg

Which basically means that while Sirius spends more to get its subscribers than XM, its also gaining subscribers faster than XM.

So, which company should you invest in? XM, or Sirius?

FishbowlLA’s definitive reply: “Yes.”