The country’s only satellite radio company is close to filing for bankruptcy, and columnist Mike Elgan is having an “I told you so” moment. Before Christmas Elgan predicted in ComputerWorld that Sirius XM wouldn’t survive the recession, given its shaky financial status—and the downturn now looks certain to kill Sirius and "bury satellite radio forever," he writes. The problem, according to Elgin, is that Sirius hitched its wagon to the auto industry.
The company was counting on a huge increase in subscribers to pay its $3.4 billion debt, but since most of its customers are new car buyers who choose the satellite radio option, the huge dive in auto sales means "there's simply no way Sirius XM can pay its bills," he notes. Satellite mogul Chris Ergen has offered to inject millions into the troubled company, the Wall Street Journal, but it's not clear if the cash can stave off bankruptcy.