mankap Posted June 9, 2017 Share Posted June 9, 2017 I am trying to understand SXM's objective . Is it Turnaround Pandora and make it FCF positive Integrate SXM and Pandora at some point in future Use SXM's expertise in negotiations for content purchase Cross sell SXM to Pandora subscribers Link to comment Share on other sites More sharing options...
EricSchleien Posted June 10, 2017 Share Posted June 10, 2017 For another view, here's a recent short thesis on SIRI: https://www.valueinvestorsclub.com/idea/SIRIUS_XM_HOLDINGS_INC/140167 Who wants to poke holes in this OR validate it. Would love to bring the discussion here. Link to comment Share on other sites More sharing options...
Liberty Posted June 11, 2017 Author Share Posted June 11, 2017 For another view, here's a recent short thesis on SIRI: https://www.valueinvestorsclub.com/idea/SIRIUS_XM_HOLDINGS_INC/140167 Who wants to poke holes in this OR validate it. Would love to bring the discussion here. Some good counter arguments in the vic comment by Bluegrass, not sure if you've seen it. Link to comment Share on other sites More sharing options...
EricSchleien Posted June 11, 2017 Share Posted June 11, 2017 I did. Do you know much about the DTV situation from a while back? If so -- can you give me the cliff-notes version to what he is referring to. Link to comment Share on other sites More sharing options...
rtvinvest Posted June 12, 2017 Share Posted June 12, 2017 What content is truly unique for SIRI right now? Link to comment Share on other sites More sharing options...
fisch777 Posted June 13, 2017 Share Posted June 13, 2017 All of the ~70 music channels are curated. Why is that not unique? Link to comment Share on other sites More sharing options...
rtvinvest Posted June 14, 2017 Share Posted June 14, 2017 All of the ~70 music channels are curated. Why is that not unique? It's unique but in my opinion more likely to be copied. I'm trying to assess why new car buyers would continue to prefer choosing SIRI over cheaper alternatives when those become available in your dashboard Link to comment Share on other sites More sharing options...
Liberty Posted June 14, 2017 Author Share Posted June 14, 2017 What's unique is the bundle at a relatively low price and high convenience, which is especially useful to demographics that skew older, richer, and more rural (long commutes, less tech savvy). For less than a buck a day you get tons of curated music styles at the push of a button, plus lots of talk radio with some of the most popular hosts, plus lots of sports. It's available everywhere, you don't need to worry about data caps or battery levels or tapping 5 things to start the app and find what you want every time you get in the car, etc. Sure maybe some could save a couple bucks a month by using some app while hopefully staying around cell towers, but to most of the target demographic it's just not worth it. The main competitor is free FM radio. CarPlay and Android Autos will make it easier to have content owners that go directly OTT with an app, but SIRI can pay people like Howard Stern and sports rights holders a lot more than they'd get trying to build a subscriber base from scratch. Competition will keep existing, and SIRI can take advantage of some of those techs to try to reduce churn and make customers stickier/offer more value, like probably some content deal with Pandora. Link to comment Share on other sites More sharing options...
Liberty Posted June 14, 2017 Author Share Posted June 14, 2017 Podcast about the SIRI-P deal: https://www.bloomberg.com/news/audio/2017-06-13/pandora-got-siriusly-outnegotiated Link to comment Share on other sites More sharing options...
rtvinvest Posted June 15, 2017 Share Posted June 15, 2017 What's unique is the bundle at a relatively low price and high convenience, which is especially useful to demographics that skew older, richer, and more rural (long commutes, less tech savvy). For less than a buck a day you get tons of curated music styles at the push of a button, plus lots of talk radio with some of the most popular hosts, plus lots of sports. It's available everywhere, you don't need to worry about data caps or battery levels or tapping 5 things to start the app and find what you want every time you get in the car, etc. Sure maybe some could save a couple bucks a month by using some app while hopefully staying around cell towers, but to most of the target demographic it's just not worth it. The main competitor is free FM radio. CarPlay and Android Autos will make it easier to have content owners that go directly OTT with an app, but SIRI can pay people like Howard Stern and sports rights holders a lot more than they'd get trying to build a subscriber base from scratch. Competition will keep existing, and SIRI can take advantage of some of those techs to try to reduce churn and make customers stickier/offer more value, like probably some content deal with Pandora. I agree with your points regarding demographics. About the content I have some worries: Howard Stern is now available on Youtube and Soundcloud (not sure why his contract allows this?) and sports are available from multiple sources such as TuneIn as well. So I agree that SIRI has more firepower than most players (but less than Apple), however how relevant is this when content isn't just sold to one distribution channel? Link to comment Share on other sites More sharing options...
dcollon Posted June 15, 2017 Share Posted June 15, 2017 From FT: Liberty Media shows how to win deals and influence companies: US media group’s investments from radio to Formula 1 reveal unconventional strategyLiberty_Media_shows_how_to_win_deals_and_influence_companies.pdf Link to comment Share on other sites More sharing options...
Liberty Posted June 15, 2017 Author Share Posted June 15, 2017 What's unique is the bundle at a relatively low price and high convenience, which is especially useful to demographics that skew older, richer, and more rural (long commutes, less tech savvy). For less than a buck a day you get tons of curated music styles at the push of a button, plus lots of talk radio with some of the most popular hosts, plus lots of sports. It's available everywhere, you don't need to worry about data caps or battery levels or tapping 5 things to start the app and find what you want every time you get in the car, etc. Sure maybe some could save a couple bucks a month by using some app while hopefully staying around cell towers, but to most of the target demographic it's just not worth it. The main competitor is free FM radio. CarPlay and Android Autos will make it easier to have content owners that go directly OTT with an app, but SIRI can pay people like Howard Stern and sports rights holders a lot more than they'd get trying to build a subscriber base from scratch. Competition will keep existing, and SIRI can take advantage of some of those techs to try to reduce churn and make customers stickier/offer more value, like probably some content deal with Pandora. I agree with your points regarding demographics. About the content I have some worries: Howard Stern is now available on Youtube and Soundcloud (not sure why his contract allows this?) and sports are available from multiple sources such as TuneIn as well. So I agree that SIRI has more firepower than most players (but less than Apple), however how relevant is this when content isn't just sold to one distribution channel? Howard Stern on youtube is just short clips: https://www.youtube.com/user/HOWARDTV/videos If you get something else, it's probably copyright infringement and could disappear at any moment. Link to comment Share on other sites More sharing options...
Liberty Posted June 26, 2017 Author Share Posted June 26, 2017 Pandora CEO stepping down: https://www.recode.net/2017/6/25/15871686/pandora-ceo-tim-westergren-steps-down-sirius Link to comment Share on other sites More sharing options...
Liberty Posted July 27, 2017 Author Share Posted July 27, 2017 SIRI Q2: http://investor.siriusxm.com/investor-overview/press-releases/press-release-details/2017/SiriusXM-Reports-Second-Quarter-2017-Results/default.aspx - Net Self-Pay Subscribers Grow 466,000; Total Subscribers Exceed 32 Million - Second Quarter Revenue Climbs 9% to $1.3 Billion - Quarterly Net Income Rises 16% to $202 Million - Adjusted EBITDA Grows 12% to a Quarterly Record of $522 Million - Quarterly Operating Cash Flow Rises 12% to $483 Million; Free Cash Flow Grows 6% to $417 Million - Company Increases Full-Year Guidance for Self-Pay Net Additions, Revenue, and Adjusted EBITDA Link to comment Share on other sites More sharing options...
Liberty Posted August 19, 2017 Author Share Posted August 19, 2017 A good part of this is a profile of SIRI (LSXMA) and its economics: https://25iq.com/2017/08/19/what-would-a-healthy-music-streaming-business-e-g-spotify-soundcloud-pandora-look-like/ Pandora is monetizing at about $11 a user, Clear Channel at about $13, Spotify at about $30 and pays 2/3 of economics in royalties, and we monetize at $150 per subscriber. […] “When you have subscriber base as big as SIRI, a 0.10% change in monthly self-pay churn is equal to the difference between 70,000 subs in a quarter or 280,000 net subs in a year.” Link to comment Share on other sites More sharing options...
Happy Posted August 23, 2017 Share Posted August 23, 2017 http://www.billboard.com/articles/business/7556740/siriusxm-digital-royalties-double-soundexchange-proposal In a rate proposal presented to the Copyright Royalty board recently, SoundExchange -- the agency responsible for collecting statutory royalties from digital broadcasters like Pandora -- is seeking to more than double the royalty payments it receives from SiriusXM. SoundExchange has proposed that Sirius pay whichever bucket of revenue is greater, $2.28 per subscriber in 2018 (which would rise to $2.79 per subscriber in 2022) or 23 percent of gross revenue. Currently, Sirius pays a statutory rate of 10.5 percent of revenue, and will pay 11 percent of revenue next year. With a proposal that Sirius pay 23 percent of gross revenue for master recording ephemeral reproduction and performance royalties, that’s approaching almost 50 percent of the revenue it derives from its music-related stations. Since Sirius currently direct about 3 percent of revenue towards publishing performance royalties, the service’s total payout stands at about 26 percent of revenue -- if the CRB agrees with Sound Exchange’s viewpoint -- which is nearly double the 13-14 percent of revenue in total music royalties that Sirius is estimated to pay out currently. I came to the above link (dated October 2016) through the good article on iq25. Are rates, which SIRI has to pay on music, likely to go significantly up in the future? It feels a bit "too good to be true" or unfair that Pandora and Spotify must pay so much more of their revenues to the music industry. That is obviously great for SIRI, but is it sustainable? As SIRI is so profitable, it seems easy to argue that this competitive advantage is unfair and that new regulation will change it at some point. Link to comment Share on other sites More sharing options...
thefatbaboon Posted August 23, 2017 Share Posted August 23, 2017 https://www.crb.gov/rate/ SDARS III is the docket you want. (assuming you want a few thousand pages of light reading) The case has been argued and CRB due to rule by 15th December. You might also want to read what the CRB judges ruled last time (on SDARS II): https://www.crb.gov/fedreg/2013/78fr23054.pdf Link to comment Share on other sites More sharing options...
Liberty Posted September 22, 2017 Author Share Posted September 22, 2017 http://investor.siriusxm.com/investor-overview/press-releases/press-release-details/2017/SiriusXM-Completes-480-Million-Strategic-Investment-in-Pandora/default.aspx "Mr. Maffei was also named Chairman of Pandora." Link to comment Share on other sites More sharing options...
Liberty Posted October 25, 2017 Author Share Posted October 25, 2017 http://investor.siriusxm.com/investor-overview/press-releases/press-release-details/2017/SiriusXM-Reports-Third-Quarter-2017-Results/default.aspx - Third Quarter Revenue Climbs 8% to $1.4 Billion - Quarterly Net Income Increases 42% to $276 Million; Diluted EPS Grows 49% to $0.06 - Adjusted EBITDA Grows 12% to a Quarterly Record of $551 Million and Margin of 39.9% - Quarterly Operating Cash Flow Rises 24% to $521 Million - Free Cash Flow Grows 22% to a Quarterly Record $434 Million - Self-Pay Net Subscribers Increase 311,000 to Reach Approximately 27 Million - Company Increases 2017 Guidance for Revenue, Adjusted EBITDA and Free Cash Flow Link to comment Share on other sites More sharing options...
MrB Posted October 30, 2017 Share Posted October 30, 2017 Con call has some interesting comments towards the end; response to the bear case. L360 also signed up first major manufacturer. Think that is extremely interesting long term. Link to comment Share on other sites More sharing options...
MrB Posted November 17, 2017 Share Posted November 17, 2017 Pandora's Definitive Guide to Audio 2018 http://brands.pandora.com/rs/983-JVJ-088/images/Pandora_Definitive_Guide_To_Audio_2018.pdf?mkt_tok=eyJpIjoiTTJRd01ERTFOakZqTmpsaCIsInQiOiJHd3p6WW8rXC8wMG0xQXVEN3dGdjhHVFVkR0g1U25ScEpBOUIyQkpxUmxjdzM0bm9OMEpjR1wvXC9OakMwRlwvcnFNTitYVXlpN2lsQkhlU3g0TXl0UTFSWGZNYjlYUlRMMTNGSEZQT09jYWttV3I3UXlkVmVWblpyMFQ5MGRQY0V3OWYifQ%3D%3D Link to comment Share on other sites More sharing options...
EricSchleien Posted December 15, 2017 Share Posted December 15, 2017 https://seekingalpha.com/article/4132149-sirius-xm-shares-slammed-crb-rate-hike Link to comment Share on other sites More sharing options...
thefatbaboon Posted December 18, 2017 Share Posted December 18, 2017 SDAR III increases the MRF for 2018-2022 to 15.5% of Gross Revenues (up from 11% in 2017) Market didn't like but I'm curious to see the company come out and give an analysis of the economic impact of the new rate in the context of the following carve-out that they are now allowed to make in calculating Gross Revenue: "382.22 Calculation of Gross Revenue for SDARS. (b) Gross revenues exclude, (7) revenues recognized by Licensee (or otherwise received by Licensee if no GAAP "recognition"principles are applicable) for the provision of: (ii) channels, programming, products and/or other services offered for a separate charge where such channels use only incidental performances of sound recordings" https://www.crb.gov/rate/16-CRB-0001-SR-PSSR-SDARSIII/appendix-a-rates-and-terms.pdf As far as I can tell from going over SDAR II this is a new exclusion. See (near the end) Section 382 and the definition of Gross Revenues of SDAR II with following link https://www.crb.gov/fedreg/2013/78fr23054.pdf It looks like Talk, Sports and News if charged for separately from Music will no longer count toward gross revenues. If I am reading this correctly.... if they can allocate and separately charge 30% of their subscription services to non-Music services then doesn't 15.5% next year looks a lot like 11% this year? Link to comment Share on other sites More sharing options...
EricSchleien Posted January 13, 2018 Share Posted January 13, 2018 New interview up discussing Liberty SiriusXM: http://intelligentinvesting.podbean.com/e/liberty-siriusxm-group-anthony-morley/ Link to comment Share on other sites More sharing options...
Liberty Posted January 31, 2018 Author Share Posted January 31, 2018 Q4: investor.siriusxm.com/investor-overview/press-releases/press-release-details/2018/SiriusXM-Reports-Fourth-Quarter-and-Full-Year-2017-Results/default.aspx FULL-YEAR 2017 HIGHLIGHTS Self-Pay Subscribers Exceed 27.5 Million. The Company added 527,000 net new self-pay subscribers in the fourth quarter and 1.56 million for the full-year to end 2017 with approximately 27.5 million self-pay subscribers. Total net additions in the fourth quarter and full-year were 569,000 and 1.39 million, respectively, taking the Company's total subscriber count to approximately 32.7 million at year-end. As of December 31, 2017, SiriusXM Canada had approximately 2.8 million subscribers. SiriusXM Canada's subscribers are not included in the Company's subscriber count or subscriber-based operating metrics. The Company also provides traffic services to approximately 7.5 million vehicles. Strong Revenue and ARPU Growth. Full-year 2017 revenue climbed 8% compared to the year ago period to a record $5.4 billion. The growth was driven primarily by a 4% increase in subscribers and a 3% increase in average revenue per user (ARPU) to $13.25. Record Adjusted EBITDA. Adjusted EBITDA in 2017 reached a record $2.12 billion, up 13% from $1.88 billion in 2016. The Company's adjusted EBITDA margin was an all-time high of 38.9% in 2017, a 160 basis point increase from 37.3% in 2016. Free Cash Flow Reached a Record $1.56 Billion. Free cash flow for 2017 totaled $1.56 billion, up 3% from $1.51 billion in 2016. Operating cash flow for 2017 totaled $1.86 billion, up 8% from 2016. Link to comment Share on other sites More sharing options...
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