XSR-SV.TO

Canadian Satellite Radio (CSR), which operates XM Canada, will raise its monthly price beginning in September in order to offset its financial losses, the company announced July 13.

New subscribers to the satellite radio service will pay 14.99 Canadian dollars ($13.24) per month beginning Sept. 1, while current subscribers and people who signup before the end of August will pay 12.99 Canadian dollars ($11.47) per month through August 2007. Subscribers to multi-year packages will also receive discounts.

"This new price increase is warranted by the benefits to our subscribers of our unique and exclusive programming, leading edge equipment … and extensive signal coverage," Steve Tapp, president and COO, said in a statement.

CSR reported 80,000 subscribers to XM Canada at the end of its 2006 third quarter, which ended May 31, surpassing its expectations of 75,000 by the end of August. The company added that only 64,000 of those are paying for the service.

In its 2006 third quarter, XM Canada generated revenue of 2.34 million Canadian dollars ($2.1 million) from subscriptions, activations, advertising and radio sales. The company lost 20.4 million Canadian dollars ($18.2 million). The service was launched at the end of 2005, so there are no corresponding figures from the third quarter of 2005.

Average revenue per unit in the quarter was 13 Canadian dollars ($11.48), while subscriber acquisition costs were 69 Canadian dollars ($60.94). Cost per gross addition grew from 194 Canadian dollars ($171.34) in the second quarter to 241 Canadian dollars ($212.85) in the most recent quarter due to increased advertising and marketing expenses.

Separately, XM Canada announced it had added Suzuki Canada to its vehicle partnership lineup. The automobile manufacturer will begin factory installations of XM radios starting with the 2007 model year and car buyers will receive free activation and three free months of service.

Rival Sirius Canada also inked an exclusive factory installation deal, adding Ford of Canada to its lineup starting with 2007 model cars, the company announced July 13. Sirius radios will be standard equipment in nearly all Ford vehicles sold in Canada by 2008, the companies said.

TELN

Telenor gained total control of Maritime Communications Partner (MCP), acquiring the remaining 61.3 percent of the company, which provides voice and data services to ferries and cruise ships, Telenor announced July 7. MCP’s offering, delivered via GSM mobile telephones, is complementary to Telenor’s existing products, Telenor said, and the company plans to develop services that combine GSM and satellite networks. Financial details of the transaction were not revealed.

SGH:LN

Satcom Group Holdings plc, a reseller of mobile satellite communications, entered into a conditional agreement to acquire World Communications Center (WCC), a reseller of Iridium services, Satcom company announced July 10.

The deal is valued at $4.1 million, with $800,000 to be paid in cash and the balance in about 3.5 million shares of Satcom and $1.1 million in convertible unsecured bonds. Additional payments will be based on WCC’s performance. In 2005, the company reported revenues of $10.1 million. This is the third acquisition for Satcom since July.

VOXX

Revenues for Audiovox Corp. fell 20 percent to $111.3 million in the company’s 2006 first quarter, due in part to a decline in the sale of satellite radios, Audiovox reported July 10.

Sales in the Mobile Electronics unit, which represent 74.6 percent of Audiovox’s total sales, were $83.1 million in the quarter, down 10.6 percent from a comparable period a year ago.

"This decline was due primarily to lower sales of satellite radio products given the issues previously documented by the company," Audiovox said. Among those issues was a delay in shipments of a receiver for XM Satellite Radio when the device failed to meet emission standards set by the U.S. Federal Communications Commission.

BA

While Boeing Co. has stopped new sales of its Connexion service while it explores the future of the business, at least one analysis has predicted the end of the satellite Internet service.

In a June note to clients, Tim Farrar, president of Telecom, Media and Finance Associates Inc. (TMF), a Mobile Satellite Services consulting firm, predicts that it will not be possible to make Connexion a commercial success.

The service has attracted just more than 1,000 users per day across 125 commercial aircraft that have installed the service and cost about $150 million per year to operate, Farrar wrote. "Even if usage of the service grows further, at least 1,000 aircraft would need to be fitted out for the business just to break even. The service has won plaudits from users, but in our view there simply isn’t enough demand from passengers to make Connexion a commercial success."

The service could have potential if aimed only at military and government audiences, "but we do not believe that the commercial passenger service can realistically be maintained," Farrar said. "Airlines using the service already incur a substantial penalty in fuel costs for the weight and drag of the Connexion equipment and are unlikely to subsidize the service still further."

Boeing said options for the unit include "a sale, partnering arrangement or termination of service," and the decision will be made after meeting with Connexion customers.