Rick,
Honestly, do you know anything abou venture capitalism? Seriously. The AVERAGE time it takes a start-up business to break even is 3 years... Also, you talk about "what this country just went through." The market has been expanding now for about 2.5 years straight. The DOW and the NASDAQ are up about 35% in that time period, which means capital and investors ARE buying into the market.
HONESTLY, uhhhh, YES I DO know a thing or two about venture capital. Have you actually READ what I've written??? Have I ONCE disagreed with the fact it'll take many years to break even/become profitable???? How about going back and reading my posts before trying to argue with me. What I've been saying is I KNOW it will take time. I KNOW it will cost money. However, nobody seems to be willing to step up and invest in Voom. Am I wrong? If I am then why are we even having this discussion????
Now, as far as Voom operating at a huge loss, you need to consider this: Most of the "loss money" has already been spent... The start-up costs are enormous, and they've already been spent - they reflect in the budget now because they have been amortized over several years. However, whether or not Voom is in business, it needs to pay for all of those costs unless it files for bankruptcy protection. Secondly, their are ADDITIONAL costs incurred when closing down (e.g. canceling vendor contracts, legal paperwork, severance pay, collection costs to reclaim leased assets, etc.)
And no, the, "loss money," has NOT already been spent. Sure, they put a satellite up--which they've just sold to Echostar. Sure, they built an uplink facility--which they've just sold I believe. So that money, although it's been spent, would need to be spent again in some way shape or form whether it's through a lease or another purchase (unless, of course, the sale doesn't go through--another discussion).
Also, it still costs them a LOT of money to gain a new sub. We can all argue how much it costs but nobody around here really knows just how much a sub cost but we know it ain't cheap. Add to that the dropout rate they've experienced. Again, none of us knows what it is but we all have a feeling it's fairly high. This also costs them money. So they've still got a lot more money they need to spend in order to get the ball rolling. Again, I agree with this but nobody is stepping up to invest in Voom. Am I wrong???
So, since it is going to cost them money anyway, doesn't it make sense that they make a full-court press to try to turn a profit, or at least get some return for their losses. You need to remember that it may cost $75 million to run Voom right now, but it will take hundreds of millions to shut Voom down.
Absolutely, however, in order to do this, they need money. They don't have money right now. If you're asking me whether I feel CVC should invest further in Voom I'd say no. If I were a CVC stockholder (heck, I may be in one of my funds and I may not realize it), I'd want them to sell it off, too. From a business standpoint, it makes sense for them. If you really believe Voom can survive in the current environment (I, honestly, don't believe they can but I wish they could) then I'd say someone should invest in the company. Apparently, many other people seem to agree with that line of thought--that Voom can't survive in the current environment. Doesn't make us right or wrong. Just what many of us believe. It also doesn't mean we don't want Voom to survive.
The Rickster
