Analyst Upbeat on Satellite Radio

Analyst Upbeat on Satellite Radio

FBR Expects XM, Sirius to Continue to Benefit From Proprietary

NEW YORK (AP) -- Friedman, Billings, Ramsey & Co. reiterated
"Outperform" ratings for both XM Satellite Radio Holdings Inc. and
Sirius Satellite Radio Inc., saying proprietary programming should
continue to lure subscribers.

Sales staff at retail outlets that sell the radios "overwhelmingly
indicated sports and other non-music programming as key drivers
influencing the consumer's decision," analyst Maurice McKenzie said.

That "bodes well" for both companies, he said, "as Sirius airs the
2006 National Football League season beginning in August, and 'Oprah
and Friends' premiers on XM in September."

The analyst expects Sirius, whose calling card has been the addition
of talk-show host Howard Stern, to add 548,897 subscribers in the
current quarter. The company finished the first calendar quarter with
4.08 million subscribers.

McKenzie anticipates XM, which has the rights to Major League
Baseball, to grow more slowly, adding 407,752 users to its 6.5 million
at the end of March.

"Sirius is growing more quickly because of its lower subscriber base,"
McKenzie said. "But both are adding customers fairly rapidly, and
that's because of the programming."

The analyst's note did not bolster the companies' shares Wednesday, as
XM slid 30 cents, or 2 percent, to $14.63 in recent trading on the
Nasdaq. Sirius shed 11 cents, or 2.4 percent, to $4.50 on the Nasdaq.

Earlier Wednesday, Sirius got bad news when automotive supplier
Directed Electronics Inc. said the Federal Communications Commission
found two Sirius model radios are not in compliance with emissions or
frequency regulations.

McKenzie would not comment on that news. He attributed the share-price
losses to "volatility associated with companies with emerging business