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Sirius XM: Born to Lose, Destined to Fail?

NEW YORK ( TheStreet) -- From time to time, I run across that rare specimen from outside Southern California who does not know of the region's seminal punk band, Social Distortion.

Social D front man Mike Ness penned those lyrics in the headline -- Born to Lose, Destined to Fail -- in the downtrodden tale Ball and Chain. While second-guessing my decision to give up my Springsteen tickets for the next two nights in L.A. (Ness often appears on stage with Bruce), I YouTubed some Social D as I was thinking about Sirius XM's May 1 earnings release and conference call.

As TheStreet's Richard Saintvilus noted today, subscriber growth, one of the metric's by which investors judge SIRI, could come out soft:

At its fourth-quarter and full-year announcement, Sirius said it expected churn to increase slightly, by 0.2%, and that there was a "modest" response from subscribers regarding its recent base-price increase. From that standpoint, I am expecting subscriber numbers not to be as robust as investors are anticipating, even though Sirius said in February it planned to add 1.3 million subscribers in 2012, a figure widely regarded as low.

While I agree with Richard, I also believe many investors have tired of anticipating the same old numbers from Sirius XM. CEO Mel Karmazin's touts about subscriber uptake, free cash flow and the possibility of "returning capital to shareholders" have become old fast. Relative to his aggressive competitors (i.e., practically everyone else in the media industry), Mel seems to consider a multi-platform approach to content delivery little more than an irritant. He really should brand shareholders asking him to do the inane -- buy back stock or pay a dividend -- the real pests.

This point of view, however, assumes that you (and Mel) consider Sirius XM a growth company with even an ounce of interest in innovation or any concept whatsoever of the future.

The only reason why this stock maintains the valuation it does is because, to his credit, Mel has done an excellent job keeping analysts' and investors' eyes on the wrong ball. Quarter after quarter, he preaches to them about ultimately meaningless quantitative metrics, as he infests the halls of Sirius XM with the only culture he has ever known, one drenched in slow growth and unimaginative conservatism. Many investors, however, have come to realize that that type of attitude is Born to Lose and Destined to Fail.

Until Sirius XM shows signs of embracing the future and becoming a growth company, its stock will pinball in a frustrating range. The big money wants to know about growth. Real growth, not modest growth. And while that naturally includes continued improvement at Sirius XM's core, major investors expect to see Sirius XM leverage the cross- and multi-platform opportunities that not only define the future, but have started to take hold of the present.
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