So, Rick isn't ready to concede this fight. Good for him. I admire anyone who has the courage to stand behind his decisions, even when things look pretty darn bleak. And I can appreciate his optimistic prediction that XM's (NASDAQ:XMSR) multiple business ventures have the potential to reap high margins and other big rewards.

But I simply see too many "what ifs" in this equation to let myself be persuaded. XM needs so many things to go perfectly right that the odds would seem nearly insurmountable for even a well-run, profitable company -- let alone one drowning in red ink and making some highly questionable marketing, programming, and PR decisions. Too many of XM's prospects are pinned on the hope of meeting subscriber-growth projections, and those projections, as we've seen, have been shrinking lately. On an upward trajectory, yes, but shrinking.

As for XM's numerous partnerships, I agree with Rick to the extent that some of them -- including its deal with Starbucks (NASDAQ:SBUX) to sell exclusive compilation CDs from its Artist Confidential series -- will bring modest rewards, but it's still not enough to turn this ship around. Besides, some of the company's other partnerships, as I mentioned earlier, are with the likes of General Motors (NYSE:GM) and Time Warner's (NYSE:TWX) AOL. And I don't need to tell you about the woes those companies have been experiencing lately. XM has high overhead and a big hole to dig out of, and risky partnerships with no guarantee of sizable payoffs just won't pay the bills.

Sure, XM can keep jacking up its subscriber rates to help offset the damage. But as Rick pointed out, people will pay more for something like satellite TV content than they will for satellite radio, and XM can't justify charging much more than it does now -- even if it does eventually incorporate video content into its receivers. No, people didn't grumble when XM raised its fee to $12.95, but I think XM held more potential back then and kept more of its subscribers happy. I can tell you that if XM raises its rates again, I won't keep paying unless it does something dramatic to improve the quality and diversity of its content.

Oprah? Good. Opie & Anthony? No comment. I'm no Howard Stern fan, but I can appreciate his drawing power. XM needs to go fishing with a bigger lure to catch more marquee names like this. Then it can afford to go after some of the smaller deals that it's focusing its attention on now. That approach will also make diversifying its musical content all the more feasible, to keep the crazies out on the fringes who want their Music Lab (people like yours truly) happy while continuing to cater to the masses. The mainstream folks can still have their mainstream tunes, but they don't need 10 channels of the same thing. That does nobody any good. Leave some of those spots open to cater to some underappreciated musical styles. That's what used to help make XM unique, rather than just another faceless commodity in its market.

The wonders of the world they wrought ...
I haven't really carved out an investing philosophy for myself yet, but I do see the appeal of being an early adopter, and I understand the thrill of finding exciting investments that have the potential to change our world. That's one of the reasons I bought into the PowerShares Lux Nanotech Portfolio (AMEX:PXN) ETF earlier this year. I believe in the promise of the sector and the seemingly infinite ways in which nanotech can change and improve our lives.

I also believe in satellite radio. I think it's a disruptive technology that's here to stay. I'm not one of those people worried that the success of MP3 players will cut into its business. But I am worried that XM isn't doing enough to make music lovers and pop-culture fans want to turn off those iPods and turn on their satellite-radio receivers.

Pioneers blaze the trail, but they aren't always the most successful at what they create. They do, however, make it easier for the next generation, which can build on the successes and avoid the mistakes of their forebears. XM is certainly a Rule-Breaking pioneer. But as an investment idea, it looks more to me like the proverbial falling knife. Don't try to catch it. Let it drop, and avoid slashing your portfolio to bits.

Think you're done with the Duel? You're not! Go back and read the other three arguments, and then vote for a winner.

XM is a Motley Fool Rule Breakers pick. Starbucks and Time Warner are part of the Motley Fool Stock Advisor family. All of our newsletter investing services come loaded with a 30-day free trial.

Fool online editor Adrian Rush tries not to play with knives. He doesn't remember ever running with scissors in kindergarten, but he knows for sure that he owns a stake in the PowerShares Lux Nanotech Portfolio ETF. The Fool's disclosure policy is always on the cutting edge.