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Seven Steps To Satellite Radio Success
from the tongue-in-cheek dept
Ever since XM and Sirius first came on the scene there have been questions about how they could possibly survive. It doesn't take a genius to run the numbers and recognize that it's very, very difficult to make money in this business. The costs are enormous, and the revenue doesn't seem to be making much of a dent. So, along comes Andy Kessler to explain the perfect strategy for the folks behind Sirius, though, it applies to XM as well. You might notice that Andy's tongue is planted somewhere firmly in his cheek in this article, so I figured I'd help by summarizing the points in the article: get good content (get some hype), get good distribution (sell out), lock in users (sell out, quickly!), emphasize the technology (no, seriously, sell now), raise prices (why haven't you sold yet?), confuse Wall Street with bogus metrics (if you haven't sold by now, you'll regret it) and (oh yeah) sell out.
Reader Comments
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No Subject Given
There's another way of course -- one that's time tested in both the satellite communications and aviation world. Remember Iridium? $4B invested, then bought at bankruptcy for $25M. There's many similar stories in the aviation world too, where company X spent millions to certify a new airplane, only to be forced into bankruptcy and have the one real asset (the certified aircraft type certificate) bought for pennies on the dollar.
It might not pay for the original investors / dreamers, but in the end consumers get a good deal! There's something special about aerospace that draws in billions of dollars into fun but dumb ideas....
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Re: No Subject Given
I think XM will do fine. They're not burning through money like Sirius and are setting themselves up for the long haul. They should hit the marketing a lot harder though.
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