With the financial sector on a roller coaster ride, concerns over credit debt and liquidity have impacted companies across the board regardless of sector. While the Federal Government has stepped in to bail out AIG, it could represent the latest of “lines in the sand” drawn to try to avert a crisis, that may or may not work. Concerns over Washington Mutual, Wachovia and others still loom, so the roller coaster ride is not over quite yet.

Meanwhile, in the midst of all of this we have Sirius XM Radio that has $300 million in converts in February, and then additional debt coming later in 2009. In total, the company would like to finance about $1 billion in debt. In current markets that represents challenges for Sirius XM radio. While they may have some offers, they are likely at rates that the company would rather not have.

So what viable solutions are available?

Currently Sirius XM Radio has about 19,000,000 subscribers. The company, at this point, should give consideration to any and all avenues to generate enough cash from that subscriber base to put themselves in a position to either better negotiate with lenders, or better yet pay down that debt.

BEST OF

As we are all aware, the “Best Of” programming will be available on October 5th. This programming offers the ability for current Sirius subscribers to access some additional programming from the XM service, and XM subscribers to receive Sirius programming. The charge for this premium service is $4.99 per month.

Let’s assume that 10% of the subscriber base thinks that “Best Of” is a great idea. Why not offer a pre-launch of “Best Of” right away at a discounted rate in exchange for a one year prepayment. The “Best Of” will cost subscriber $60 per year if they pay monthly. Pre-Launch it for $40 for one year, and start collecting the money. The offer will be good only until October 31st. With 1,900,000 subscribers (only 10% of the existing subscriber base) paying $40 each up front, it would instantly deliver $76,000,000 into the coffers of the company.

PREPAYMENT BONUS

Start a campaign titled something like “Add A Year For Your Ear”. Sirius XM Radio currently enjoys a subscriber pool where over 20% of the base is on a 1 year or higher plan. Let those loyal subscribers get a good deal, and bring cash into the company. One year of the base service costs $155. The company should take advantage of the fact that their subscribers like to prepay, and further that people want a good deal in these trying economic times. Let this group of subscribers add a year to their existing plan for $100. This loyal group of about 3,800,000 subscribers would infuse the company with an additional $380,000,000. In addition, some that currently do not prepay may be enticed to step up to the plate themselves.