Have You Noticed It's Costly To Run A Bunch Of Satellites? XM Has...

from the ain't-so-easy dept

From the very beginning of satellite radio, I was skeptical of its potential. While I admit I was wrong about the number of people it would appeal to, my bigger issue was with the cost structure of the business. Launching and maintaining satellite is extremely expensive. Just ask anyone who worked on Iridium or Teledesic. Even if you can sign up a lot of users, the capital costs are tremendous. If the costs of getting those subscribers is high, then it's a definite recipe for trouble. So far, Sirius and XM have been able to keep kicking, mainly through a ton of investment money and the promise of future potential profits -- stacked up against continued losses. It looks like a few are finally doing the math on all of this and realizing that the satellite radio business, as much as some people like it, may not be sustainable. XM posted wider than expected losses today, blaming higher than expected customer acquisition fees -- suggesting that, for all the good press, not as many people as expected have been rushing to sign up. Also, one of the company's directors resigned, citing a "crisis on the horizon," which is anything but inspiring.

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  1. identicon
    Mike, 16 Feb 2006 @ 6:38pm

    Lets talk about sound quality also

    Lets talk about quality it sounds ok in the car and passable at home but on headphones it sounds terrible. If they up the bandwidth I might take a listen but Ibelieve it is around 66KBPS at 32KHZ not even up to MP3 standard! Also you uys need to do some more research cause Sirius has a DVR based unit for under 100 buck which you can pause rewind and fastforward music for 40 minutes. They also have a portable handheld called the S50 which can store 80 hours of programing and play MP3's

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