Note: Sample below may appear distorted but all corresponding word document files contain proper formattingExcerpt from Term Paper:
XM has taken a more target product strategy, attempting to increase depth of programming services over the pervasive offering of devices. Industry analysts have commented that Sirius is now competing with Apple and their iPod series based on the breadth of their devices (Sirius Satellite Radio Investor Relations and SEC Filings 2008). Sirius' approach to personal satellite players has only been marginally successful and clearly given the operations expenses shown in Table 1's analysis of Income Statements. The breadth of the product line is forcing Sirius to also develop expertise in supply chain operations and fulfillment, two series of business processes that are significantly different than broadcasting and entertainment. Having to contend with a value-based business model with entertainment channels while also concentrating on a price-based model that must focus on continual price reductions forces Sirius into multiple and often confusing accounting systems and practices. It is highly recommended that given the merger now in effect that a separate Products Division be created, with specific responsibilities for standard costing, production variance analysis, and a reliance on production-based accounting dashboards and scorecards to manage this business.
The launch in Q3, 2007 of the Xpress EZ, Xpress R, and Commander MT squarely position the company in competition with Apple and their iPod Series, and also force the dual accounting systems that have caused the company to lose focus on its cost containment objectives. The integration of XM NAV Traffic, XM Wx Weather, XM Stocks and XM Sports has continued to fuel demand for personal XM radios and receivers. One of the primary catalysts of personal XM receiver growth is the fact that 57% of all XM subscribers consider themselves to be displaced fans (XM Satellite Radio, 2008). Personal radios that are compatible with both Sirius and XM signals will require significant engineering effort, over and above the in-car systems that have the greatest amount of learned experience with them. The combined companies will need to quickly define and improve the new product development and introduction (NPDI) process that is needed for the new hybrid personal devices the company will sell, featuring sports programming. The ability to accept MP4 files from iTunes, MP3 files from many other online services, and the functionality of downloading video as video-based iPods can do today is critical to the long-term success of the Sirius/XM product strategies after the merger. The competitive threat Apple poses with video-capable iPod and iPhone families is shown in Figure 1.
Figure 1: Market Assessment of Video-Capable iPods (Apple Investor Relations, 2008)
For the combined companies and their initial experience with video content in the three-channel offering of Sirius Backseat TV there needs to be more attention given to this area, as Apple will eventually revolutionize digital entertainment as they did with music. The challenge for the combined companies of Sirius/XM is to gain access to this digital content without getting into expensive royalty arrangements as has been the case for XM today.
In assessing its future product strategies, the combined companies must focus on triangulating the costs of services and digital content royalties, standard production costs and the coordination with supply chain partners to create personal satellite players capable of receiving digital video as well. For the merger to be successful from a product strategy perspective, the future must include value-based strategies that allow for digital video and in turn, greater levels of differentiation as well through services.
Combining Marketing Messages
Today the combined companies need to step away from price competition as their primary messaging and concentrate on market development and being the catalyst of this growth. According to InStat (2007) the market will grow to 32 million units in 2011, and in 2005, 57% were aware of HD Radio, climbing to 77% in 2007. For the merged companies to be successful they must act more as market catalysts than low-price leaders. The freedom of speech inherent in satellite radio as Sirius has used as one of their unique value propositions needs to increase, and spread as a messaging component across both companies. Further, there is the need from a marketing messaging standpoint to take a more premium-channel approach to their programming and move away from such a royalty-centric business model in the case of XM. In conjunction with these changes is the urgent need to re-vamp pricing and messaging for the advertising business, an area that could, if managed from a service and costing standpoint more effectively, could turn the combined companies profitable. The bottom line is that the unique strengths of XM with its ability to generate new products and Sirius' ability to generate awareness and trial, the combined companies must define a unique selling proposition that sets high expectations for consumers and then create an organizational structure that provides for their rapid and full attainment. The concentration on video content and battling Apple must become part of the brand as consumers will increasingly also require convergence of entertainment devices. The combined companies can win market share by attacking this trend rather than waiting for the trend to come and impact them.
Andrew Edwards, Mike Barris. (2008, May 13). Earnings Digest -- Media: Losses Dog Sirius, XM. Wall Street Journal (Eastern Edition), p. B.7. Retrieved June 1, 2008, from ABI/INFORM Global database. (Document ID: 1477481521).
Apple Investor Relations. Investor Relations website for 2008-2008 filings with the Securities and Exchange Commission.,. Retrieved June 1, 2008, from Apple Investor Relations and Filings with the SEC Web site: http://www.apple.com/investor/
Goh Shu Fen (2008, January). Is there really true value in value-based pricing? Media, 21. Retrieved June 3, 2008, from ABI/INFORM Global database. (Document ID: 1468593981).
Catherine Holahan, Arik Hesseldahl. (2008, March). Sirius and XM Get the Justice Go-Ahead. Business Week (Online) Retrieved May 21, 2008, from ABI/INFORM Trade & Industry database. (Document ID: 1450933951).
In-Stat: Digital Radio Market to Experience Global Market Growth - Unit Sales to Increase Three-Fold. (2007, November). Wireless News,1. Retrieved June 1, 2008, from ABI/INFORM Trade & Industry database. (Document ID: 1379147371).
Harry Maurer & Cristina Linblad (2008, April). SIRIUS and XM GET a NOD. Business Week,(4078), 8. Retrieved May 28, 2008, from ABI/INFORM Global database. (Document ID: 1456079731).
Sarah McBride (2008, June 3). Slowdown Generates Static for XM, Sirius. Wall Street Journal (Eastern Edition), p. B.1. Retrieved June 3, 2008, from ABI/INFORM Global database. (Document ID: 1488779231).
Sirius Satellite Radio, Sirius Investor Relations (2008). Sirius Satellite Radio Reports and Filings. Retrieved June 1, 2008, from SIRIUS Satellite Radio Investor Relations and SEC Filings Web site: http://investor.sirius.com/edgar.cfm
XM Satellite Radio, XM Investor Relations (2008). XM Investor Information. Retrieved June 2, 2008, from XM Satellite Radio Investor Relations Information and SEC Filings Web site: http://phx.corporate-ir.net/phoenix.zhtml?c=115922&p=irol-sec
Table 1: Sirius Satellite Radio Inc. Income Statement Analysis
Effects of mail-in rebates
Subscriber revenue, including effects of mail
Advertising revenue, net of agency fees
Cost of services - satellite & transmission
Cost of services - programming & content
Cost of services - revenue share & royalties
Cost of services - customer service & billing
Cost of equipment
Sales & marketing
Subscriber acquisition costs
General & administrative expenses
Research & development
Engineering design & development expenses
Equity granted to third parties & employees
Non-cash stock compensation
Total operating expenses
Income (loss) from operations
Interest & investment income
Interest costs charged to expense
Debt conversion costs charged t
Loss from redemption of debt
Equity in net income (loss)
Total other income (expense)
Income (loss) before taxes
Current state income taxes
Current income taxes
Deferred federal taxes
Deferred state taxes
Total deferred taxes
Income tax expense
Net income (loss)
Source: (Sirius Satellite Radio Investor Relations and SEC Filings, 2008)
Table 2: Sirius Satellite Radio Inc. Ratio Analysis
Return on Equity (%)
Return on Assets (%)
Return on Investment
EBITDA of Revenue (%)
Operating Margin (%)
Net Profit Margin (%)
Effective Tax Rate (%)
Working Capital/Total Assets
Total Debt to Equity
Long-Term Debt to Assets
Source: (Sirius Satellite Radio Investor Relations and SEC Filings, 2008)
Table 3: XM Satellite Radio Holdings Inc. Income Statement Analysis
Net ad sales revenue
Revenue share & royalties exp.
Customer care & billing expenses
Cost of merchandise
Ad sales expenses
Satellite & terrestrial expenses
Total broadcast & operations exp.
Broadcast & operations expense
Programming & content expense
Total cost of revenue
Research & development expense
General & administrative expense
Retention & support
Subsidies & distribution
Advertising & marketing
Amortization of GM liability
Total marketing expenses
Depreciation & amortization expenses
Total operating expenses
Operating income (loss)
Loss from de-leveraging transactions
Loss from impairment of investments
Equity in net earnings (loss) of affiliate
"Competitive Strengths And Weaknesses Of" (2008, June 06) Retrieved December 10, 2016, from http://www.paperdue.com/essay/competitive-strengths-and-weaknesses-of-29457
"Competitive Strengths And Weaknesses Of" 06 June 2008. Web.10 December. 2016. <http://www.paperdue.com/essay/competitive-strengths-and-weaknesses-of-29457>
"Competitive Strengths And Weaknesses Of", 06 June 2008, Accessed.10 December. 2016, http://www.paperdue.com/essay/competitive-strengths-and-weaknesses-of-29457
The basic reason for the diverse findings could refer to the following: most studied have been conducted on a single organization the family-friendly policies are analyzed as a whole and therefore the efficiencies of a single program are neglected employees' answers are given in questioners and the workers have to rely on memory and personal perception most of the studies have no terms of comparison the studies generally measure satisfaction
Thus, the competitive intelligence assisted the company to align its strategic plan as well as keeping executive informed about the key element of decision-making. The company also derived advantages from market intelligence advantages and the advantages assisted the company to understand the market activities and competitive market environment. Typically, Avnet also used the competitive intelligence to create a Strategic Leverage Matrix (SLM) that the company literarily plots to understand the
Competitive Advantage In contemporary times, competition is getting tougher with the passage of time and therefore product leaders are propelled to present novel and unprecedented products, nevertheless, what is meant by 'best product'? And which type of product decisions do the product leaders make in this regard? Generally, when consumers purchase a product they comprehend that it gives them a superior level of satisfaction as compared to the other competing products
The bargaining power of suppliers Suppliers have a relatively high bargaining power. On a market like organic foods, suppliers are very important for companies' activity. In other words, they practically depend on their suppliers. As a consequence, suppliers represent the most important environmental factor of influence for Whole Foods, and the same situation applies in the case of any organic foods company. This business consists mainly in the raw materials that the
Cost leadership Attracting more customers and gaining financial advantage over the competition as profits would increase 4 Forces the company to drastically reduce costs, meaning that product quality could suffer demises -4 0 6. Focus strategy Can achieve either of cost advantage or differentiation 4 Addresses a niche market -4 0 7. Differentiation strategy Product uniqueness which allows for the charging of a premium price to cover for the additionally incurred expenditure 5 Additional costs which will reduce overall financial gains (they will however be recuperated from
Net, 2006). The power of buyers is the impact that customers have on an industry. In general, when buyer power is strong, there exists a market in which there are many suppliers and one buyer. Under such market conditions, the buyer sets the price. Buyers are strong if there are a few buyers that take up the entire market share, and are weak if the product producer can take over
Sadafco Case Analysis What are the Strengths and Weaknesses of SADAFCO? SADAFCO has several strategic strengths that have given the company a defensible market position in their core markets. In addition to their brand strength, their distributions agreements with Bagalla continued to be a highly effective barrier to entry. With 13,000 freezers installed in Bagella stores, SADAFCO has not only captured shelf space, they have also captured mindshare and supply chain planning