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I think this is a HUUUGGEEE deal for SIRI, any thoughts???
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My thoughts are as follows:
SIRI has a good product with limited competition. That being said, what they need to be successful is subscribers, the question is how do you get subscribers at a low premium? One way is to sell the hardware at very low margins, or even below cost, to get that allmighty monthly charges going. Personally, I think they have a good price point of 10 bucks, and a big advantage over their competition because they have no commercials. I can see that one might think signing Howard Stern is a big deal, and for the stock it obviously provided a boost, at least in the short term. The question here is, will having Howard Stern attract enough new subs on his own to warrant the expense? I doubt it. While many people enjoy his program, I would have to question if many of them would rush out and spend 100s of dollars to listen.
Howard could care less if it doesn't bring in new subs, he gets his money either way, and can always go back to regular radio. I would like to see some numbers on this deal in about 2-3 months.
What I would prefer to see them spend their cash on is a better advertising campaign with excellent TV spots. They already HAVE a great product, they just need to find a way to showcase a little better than they have. They need to make it more accessible. Look at how DTV and DishNet have taken off from having a zillion guys in trucks zipping around installing for them. If SIRI was smart, they would ink some deal for these guys to provide SIRI installs as well. Maybe even a package deal with one of the sat networks.
I have a lot more thoughts on SIRI, as I consider it a very good long-term play, but with a sub-based company you simply have to wait and wait for the subs to happen and for numbers to increase. The promise of a sudden "rush" of new subs just never seems to pan out. Now, a deal with a sat tv provider might get them a quick boost...
-Dave -
Now, a deal with a sat tv provider might get them a quick boost...
-Dave
They do have a deal with a sat TV provider...Dish Network.Comment
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