Is Mr Dolan Sr. trying to pull a fast one?

[JoeSp]

I need someone with accounting experiance to help me out with some numbers.

Lets see, CVC has posted 1.2 billion in losses for VOOM since the startup. CVC posted 375 million in losses for VOOM's operation over the last quarter. At 50000 subscribers now (I am being very positive with this number) x $89 per month (I know that everyone does not have VAVAVOOM but I am trying to put up the best numbers) the total monthly income is $4.5 million. $4.5 times 3 months (a quarter) is 13.5 million revenue against 375 million lost. And the guy responsible now wants to buy the remaining assets without excepting any of the losses to the stockholders (the 1.2 billion)!

Does anyone here really believe that if Mr. Dolan Sr. gets to buy the remaining VOOM assets that the SEC is NOT going to investigate? You guys must not own any stock!

If this were WorldCom or Enron this dude would be looking at a jail time. The stockholders would be livid!! CVC stock has been taking a beating for the last year and a half over VOOM and no matter how you look at it -- if Sr. gets the remaining assets there is going to be an SEC investigation. Especially with the lastest ouster of board members and installing his own guys.

On a much bigger downer, it would take 421,349 suscribers at $89 a month to turn 375 million. AT $50 a month it would take 750,000 suscribers to make that much money. That is probably all the HD subscribers on all three sat companies right now. So, I believe that Sr. is trying to pull a fast one, get the assets already developed and in place and seperate it from CVC and let the stockholders hold the bag for the startup. Oh man -- the SEC just loves these kind of deals!

 

[jame_g]

I think the $375M 4th quarter loss included some one time costs or write-offs. My guess is that the actual recurring expenses would be closer to the $75M loss posted from 3rd quarter.

Just my two cents, which on occasion turns out to be all it's worth. Fortunately that's not usually the case at work or I'd be out of a job!

 

[graphiteRT]

I need someone with accounting experiance to help me out with some numbers.

Lets see, CVC has posted 1.2 billion in losses for VOOM since the startup. CVC posted 375 million in losses for VOOM's operation over the last quarter. At 50000 subscribers now (I am being very positive with this number) x $89 per month (I know that everyone does not have VAVAVOOM but I am trying to put up the best numbers) the total monthly income is $4.5 million. $4.5 times 3 months (a quarter) is 13.5 million revenue against 375 million lost. And the guy responsible now wants to buy the remaining assets without excepting any of the losses to the stockholders (the 1.2 billion)!

Does anyone here really believe that if Mr. Dolan Sr. gets to buy the remaining VOOM assets that the SEC is NOT going to investigate? You guys must not own any stock!

If this were WorldCom or Enron this dude would be looking at a jail time. The stockholders would be livid!! CVC stock has been taking a beating for the last year and a half over VOOM and no matter how you look at it -- if Sr. gets the remaining assets there is going to be an SEC investigation. Especially with the lastest ouster of board members and installing his own guys.

On a much bigger downer, it would take 421,349 suscribers at $89 a month to turn 375 million. AT $50 a month it would take 750,000 suscribers to make that much money. That is probably all the HD subscribers on all three sat companies right now. So, I believe that Sr. is trying to pull a fast one, get the assets already developed and in place and seperate it from CVC and let the stockholders hold the bag for the startup. Oh man -- the SEC just loves these kind of deals!

Sorta loose with the facts there. CVC is up almost 50% in the 1 year chart and nearly over 100% at it's peak last week on the two year.

If that's taking a beating, I hope my stocks get beat like a rented mule.

He's totally within his rights as Chairman of the Board to install those people. That argument is a non-starter. He's also within his rights to propose removal of his son come Monday and I wouldn't be at all surprised to see the new power shift go along with the idea.

BTW, some of these Board members that were replaced are recently retired and in one case......deceased. Looks more like slots that needed to be filled regardless of the current situation.

 

[jeslevine]

just curious, do you have voom joesp?

 

[softwiz]

I need someone with accounting experiance to help me out with some numbers.

Lets see, CVC has posted 1.2 billion in losses for VOOM since the startup. CVC posted 375 million in losses for VOOM's operation over the last quarter. At 50000 subscribers now (I am being very positive with this number) x $89 per month (I know that everyone does not have VAVAVOOM but I am trying to put up the best numbers) the total monthly income is $4.5 million. $4.5 times 3 months (a quarter) is 13.5 million revenue against 375 million lost. And the guy responsible now wants to buy the remaining assets without excepting any of the losses to the stockholders (the 1.2 billion)!

Does anyone here really believe that if Mr. Dolan Sr. gets to buy the remaining VOOM assets that the SEC is NOT going to investigate? You guys must not own any stock!

If this were WorldCom or Enron this dude would be looking at a jail time. The stockholders would be livid!! CVC stock has been taking a beating for the last year and a half over VOOM and no matter how you look at it -- if Sr. gets the remaining assets there is going to be an SEC investigation. Especially with the lastest ouster of board members and installing his own guys.

On a much bigger downer, it would take 421,349 suscribers at $89 a month to turn 375 million. AT $50 a month it would take 750,000 suscribers to make that much money. That is probably all the HD subscribers on all three sat companies right now. So, I believe that Sr. is trying to pull a fast one, get the assets already developed and in place and seperate it from CVC and let the stockholders hold the bag for the startup. Oh man -- the SEC just loves these kind of deals!

I have to agree. The math just doesn't add up. Don't get me wrong, I've had Voom for 7 days now and love it. But you just have to wonder how many subscribers it will take to break even for an outfit like this.

DirecTV has 12,000,000 and they still lose money. WTH?????

Maybe the math has been posted before, but how much does Voom lose a month and how man subs do they need to zero out that loss?

 

[graphiteRT]

Suggestions of anywhere between a million and a million-five have been made. Startup costs are high. Launching satelllites is expensive(as well as risky). Why do you think E* jumped on a $200M deal?

I would think 3-5 years of unprofitability is not unreasonable for this type of industry. We're 18 mos out since start of service. What are people expecting?

 

[labnet]

Major problem with the theory above. There is enmorous cost to put one of the those sattelites in space. Your theory does not take this into account; sorry

 

[bryan27]

Continuing with labnet there are continuing costs associated with owning a satellite such as tracking, station keeping, etc... In addition VOOM uses 3 call centers, with 50,000 subs they could probably get away with 1 call center with 1/2 for customer service and 1/2 for sales. There is also the cost of 2 uplink centers, losses from people not paying their bills, and subsidizing receivers.

With the sale of Rainbow-1 and 1 uplink center a large chunk of the money drain is pluged. It is much cheaper to rent satellite space. Have 1 call center and another big chunk is gone. It's been 10 months since I've called customer service. People need to quit calling with "are you still open" BS and let them do their jobs. The lease on AMC-6 is about $84 million, pay the lease right off the bat and that's taken care of until AMC-6's life is up. Cut people off that don't pay their bills (none of this 90 days over due crap). Start offering PPV and sell ad space on the SD channels for extra income.

It is possible a yearly revinue of $54 million from subs can keep the service going. You just need to cut out luxuries and be bare bones for a few years.

I completly agree with graphiteRT, unprofitability is to be expected for a few years, D* and E*s sucess didn't happen in a few months it took years.

 

[Lobstah]

I read a post in a different forum that said Direct lost $400M in Q4 last year. That's one quarter.



Would be interesting to see what the big charge was that took them from $75m loss in Q3 to $375m loss in Q4.

Lob

 

[Bruce]

I read a post in a different forum that said Direct lost $400M in Q4 last year. That's one quarter.



Would be interesting to see what the big charge was that took them from $75m loss in Q3 to $375m loss in Q4.

Lob

They closed the South American DirecTV unit and that loss was the result of that, it was a planned charge off when NewsCorp took over.

 

[Lobstah]

Thanks for the info.
I was actually referring to VOOM's losses Should have been more clear in my musings...

Lob

 

[JoeSp]

First, I am currently not a VOOM subscriber. I had my wife talked into it in Jan. when all of this started. Now she says wait till the smoke clears before I sign up for the service. Since she pays half of the bill I will have to abide by her wishes.

Second, How many years must a satellite company operate before turning a profit? And after VOOM has been operating for two years how do they post a 375 million dollar loss for 1 quarter? How many quarters must CVC lose this kind of money before they give up the ship?

Third, I believe that the SEC wants to know how a company can write off 1.2 billion in losses than sell for a meager 200 mill from E* and an estimated 250 mill from Dolan Sr. and call it quits. I believe that the fact the Mr Dolan Sr. is the one buying the rest of VOOMs assets and is the primary stock holder in CVC is what is getting the attention. If the buyer of the Rainbow assets were someone else outside of the company than I believe that there would be no investigation.

Fourth, I believe that kicking out the three board members does not make Sr. posistion as to how the SEC views this particular deal above board. While it is legal there will always be the loss of the 1.2 billion to the CVC stockholders that the SEC will want to have explained especially since Sr. replaced those board members himself.

 

[graphiteRT]

The length of operation before turning a profit is pure guessing. Too many variables and the consumer market can throw you a curve at any time.

The fact is 2005 is being touted as a breakout year for HDTV sales. Read what you would like into that, but you need content to feed those new sets.

Chuck Dolan has been around awhile. I'm sure he's fairly well versed on how the game works and what doesn't fly with the SEC. The bashers are rolling in here assuming he just fell off the truck. His 40 years of experience in the industry would say otherwise.

It's highly amusing that the armchair CEOs on message boards can tell everyone how it should be done. Reality is Dolan Sr. is a billionaire trying to pull off a last minute miracle and the armchair CEOs are pissing away idle time on an Internet message board. That sorta speaks volumes all by itself.

 

[MasterFX1]

The subscriber count also nearly doubled in one quarter, right? If it takes 7 quarters to get to 26,000 and then just one more to get to 46,000 subs... Could we be seeing the transition from the lag period to the accelerated growth period? I know this is a stretch, but if the sub base continues to double every quarter, it would not take very long at all to be profitable (in business years).

 

[leaderc]

You would also have to factor into the growth potential the fact that, with the website currently down, how many potential subs is V* losing while this whole soap opera plays out? They may have seen the beginning of a breakout in subscriptions, but, even if Dolan Sr. pulls it off, he has to recoup the public image (by and large, this board excluded) that Voom is dead.

Charles

 

[MasterFX1]

This entire saga is but a grain of sand in the hour-glass of a long-term business. It might also be the big grain that clogs it.

The existing customers are very loyal. The disappointed subs already dropped the service months ago. I think even if the entire service shut down for as much as 3 months, a whopping majority of the existing subs would make-do and wait... re-subscribing to VOOM HD LLC.

If that were to be the case, and Sr. himself made the plea to subs... I think he wouldn't lose much, in fact, the display of sub loyalty may entice potential new subs.

 

[satTV]

Every one here needs to relize that VoOm was a good idea, while it lasted.
They took a chance from the beginning, and lost the shirt on the deal.
Maybe if they wouldn't have spent the millions upon millions on advertising, which by the way obviously didn't do them ANY good. Take your free-to-air VOOM reciever and sign up for some other service.
DIGISCIFR!

Suck it up and stop complaining.

 

[gutter]

Someone said that VOOM has been around for 2 years. make that just 1.5 years. D* has been around...what for 12 years and lost over a billion dollars in 2004. That is a "B" not an "M." E* is profitable and with fewer subs than D*.

 

[bryan27]

The fact is 2005 is being touted as a breakout year for HDTV sales. Read what you would like into that, but you need content to feed those new sets.

This is also the year that stations start pulling the plug on analog operations. A few of our locals will be digital only in May, so people will be looking for STBs and VOOM would be right there prime for the picking especially for those in metro areas without cable or satellite.

 

[gutter]

Bryan27...I hate to agree with you but you do look a lot like James Dolan, but a lot more on the ball.