Ratings reflect concern about Sirius Satellite Radio Inc.'s slow progress in executing its business plan and the ultimate demand for subscription-based satellite radio. Sirius significantly trails its only direct competitor, XM Satellite Radio Inc., in most aspects of execution, and its operational progress in 2002 fell well short of its initial guidance. Sirius' subscriber growth has been hampered by delays with chipset and product development, and slow progress in reaching installation agreements with its automobile partners. Ratings also reflect the company's improved capital structure and liquidity following its recent recapitalization. The company's recapitalization in March 2003 included exchanging of 91% of its debt and all of its preferred stock for equity and raising $200 million in new equity from key
