They could be if XM reads what Banc of America Securities has to say. Based on financial analysis of XM, this major finance company feels that XM can begin to sell the Roady2 receiver for a $50 retail price, without a rebate or giveaway. Recently XM has maintained numerous offers to subsidize their receivers, including one such deal to provide a second receiver at no charge when one is purchased.
It's not unheard of for a content provider to subsidize hardware in order to build a subscriber base. In fact, it's done all the time and not just in the satellite radio space. Satellite television, personal video recording companies, cellular phone carriers and even audio book providers have done this for years. Does this mean that XM has hit critical mass and can continue to build the monthly subscription base on content and other promotions?
Even more intriguing is that Banc of America feels XM is better positioned over SIRIUS in 2006. Let's see if SIRIUS responds to either the story to any action by XM to stop subsidizing their equipment.
