Peorge, great post. You and Stockbum42 are absolutely correct, the cost per sub is way too high with all things considered.
Instead of coming back with a BMI bash, let's discuss Cost Per Sub. Very important. And many of the formulas posted here are not taking it into consideration.
Cost per sub is key and should be addressed on the board instead of diverting to the poster.
Just the percentage outlay of over $ 30 from GZFX on CC alone is a dream setup for CC. There is not any room for churn.
GZFX must get the cost per sub way down. It is killing any thought on revenue growth.
And the churn rate needs to be addressed. Losing a sub when the cash outlay is so high completely skews the growth model.
On the next Q, take a look at the actual business revenue (outside of selling shares for cash), total expenses and then divide this by the total number of subs.
They need to get a serious grip on this. If not, Peorge & Stockbum42 are correct, they must continue to go to GG for funding because cash is headed in the wrong direction, rapidly.
The cycle is a Toxic Deathspiral. Sure the company may move forward, but the price per share will get slaughtered. The more shares they sell for cash and/or GG converts for debentures, the more dilution takes place to the outstanding shares.
It is already so far out of control. Do you realize how many people it takes to buy up 4 billion plus shares ! No wonder JF has converted so many investors to flippers. imo.
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Posted by: stockbum42
In reply to: xanadu who wrote msg# 152247 Date:4/16/2006 6:20:41 PM
Post #of 152271
well, i think that the bottom line with GGI...
is that they will/are funding this CC roll-out by adding to the O/S to the tune of 5.8 billion when its said and done. GZFX loses money on a monthly basis. They have to fund this from somewhere. I think that many are worried at GZFX that the dilution will end up killing the pps so they put a safeguard their so GGI can add more shares to the O/S at every 25% decrease from .007. That way, GZFX always has cash, and if all else fails.. They do a R split at 28 bill O/S. Good thing they chose the date that it was .007... and not .015.......
so if it goes down to .005 I think that the pps is done for... and GZFX knows this and doesnt want it to happen. from .005 it goes to .001 and all of the A/S will be dumped into the O/S. that will be like the guillotine at that point.
I doubt it will go that low as long as long as they have encouraging PR's. Look for a lot of PR's to keep this pps afloat or the pps will absolutely get killed thru dilution.
I just worry that the mm's are looking at this adding 25% decrease and licking their chops. Just worried that its set up for the shorts to make a killing if they can force dilution. Probably a lot of people here that cant even understand that concept so.. anyway...
bottom line.. if the pps goes to .005... its over johnny
all in my opinion
