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 virtually all aspects of execution. Its operational progress in 2002 fell well short of its initial guidance, and the company failed to reconfirm its original subscriber target for the 2003 year-end. 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 good near-term liquidity and improved capital structure following its March 2003 restructuring. The company's recapitalization in March included exchanging 91% of its debt and all
