Citizens of Boston, you heard some awful news this week. According to reports, rock institution WBCN 104.1 FM will no longer be filling the airwaves with its iconic brand of irreverent broadcasting. Instead, it will live on as a web domain. In its place will be WBMX, a station that was formerly at 98.5 in the FM universe. An all-sports format will take up WBMX's old home. Who can you thank for this? Send all complaints to CBS (NYSE: CBS), the station's owner.

Actually, before you compose a bunch of angry missives, please consider the state of terrestrial radio. Quite frankly, CBS doesn't have a choice. Between the lousy growth prospects for the medium, and the challenged status quo of the advertising market given the terrible global recession that continues to rip through the markets like a hideous beast, changes have to be made. Changes that you thought would never come.

With its stock trading at less than 13 cents, you might think the debt-crippled Sirius XM Radio Inc. (NASDAQ: SIRI) would accept any takeover bid that would mean it could avoid bankruptcy.

Apparently, you'd be wrong. The Wall Street Journal reports (subscription required) that satellite mogul Charles Ergen made an unsolicited takeover bid late last year, but was rebuffed by the company and its board of directors. Ergen had reportedly proposed that one of his companies -- either Echostar Corp. (NASDAQ: SATS) or Dish Network Corp. (NASADAQ: DISH) -- provide the company with enough cash for it to avoid a bankruptcy filing.

Okay, let me state clearly at the beginning here that Sirius XM (NASDAQ: SIRI) closed on Monday at $0.27 per share. Right from the start, you know we're talking about a risky stock -- a lottery ticket, as they say. And since our subject is the result of a recent merger, there's a lot of pro forma data located in the press release detailing the satellite-radio company's Q3 performance.

According to that pro forma data, revenues increased 16% to almost $613 million. The pro forma net loss was halved to $0.09 per share. It's funny, because when you look through the numbers, you almost feel compelled to come away with a good feeling about the story. Total subscribers increased 17% on a year-over-year basis, subscriber-acquisition costs decreased, cost synergies are manifesting themselves, and projections for free-cash-flow generation seem to be attractive.

However, one has to realize that an attractive cash-flow statement isn't around the corner. Positive free cash flow should begin on an annual basis in 2010. Plus, Sirius XM management must deal with refinancing its debt. And it did make a $4.8 billion write-down relating to goodwill impairment. Also, the economic problems of auto manufacturers such as Ford (NYSE: F) and General Motors (NYSE: GM) are not helping Sirius XM. If car sales are down, then adoption of the satellite-radio company's programming is challenged. It's a simple relationship.

Banks are not the only companies in trouble in the current market. Sirius XM (NASDAQ: SIRI) is viewed by some on Wall Street as a dead company. Shares in the firm trade for 95 cents and have been as low as 86 cents recently. Over time, being below $1 could cause a Nasdaq delisting notice.

The newly merged company has over $2 billion in debt. Neither firm ever made an operating profit and Wall St. is unclear about how much money management can take out in a consolidation.

According the The Wall Street Journal, "The company will soon introduce radios that allow consumers more flexibility in the programming, including a 50-channel plan that costs $6.99 a month." Sirius will also bring out a "best of" offering for $4 a month.

Most struggling companies would have trouble facing one challenge. Sirius faces three.

The first is that the current Wall Street environment may make it nearly impossible to re-finance debt or raise more money. The second is that selling programming at a discount may make revenue matters at the company worse. While it could bring in more subscribers, some current customers may "downgrade" to the lower service tier, cutting the company's income-per-subscriber and undermining revenue growth.

The last and most serious trouble may be that satellite radio is not the "hot product" any more. In a world awash with MP3 players and multimedia handsets which run on 3G networks, there may be no place for Sirius to go.

Douglas A. McIntyre is an editor at 247wallst.com.

Bloomberg reports that CEO Karmazin said Sirius XM Radio Inc. (NASDAQ: SIRI) will eliminate executive positions to cut costs. No doubt, after the only two U.S. satellite radio companies merged, there are some redundancies. He also said the company could report $300 million in earnings next year excluding some items.

What's more, Sirius XM will introduce new products. Perhaps these will include what the blogosphere is buzzing about today -- a new Internet application that would stream Sirius XM to portable devices, namely the Apple Inc. (NASDAQ: AAPL) iPhone, as noted by Citigroup's Tony Wible.

Apple's iPod and iPhone products, as well as other digital music players, have been named as competitors to satellite radio by Karmazin himself. If these reports are true, could he be trying to transform them from competitors into boosting the company's user base, creating a complementing, rather than competing, services?