This will be the quarter that defines Sirius Satellite Radio (NASDAQ:SIRI). With Howard Stern's arrival in January and the NFL in high gear, this holiday-spiced period is what will either justify the stock's considerable market cap or doom the company to fall even further behind XM Satellite Radio (NASDAQ:XMSR) in subscriber count.

Yesterday, Sirius announced that it had concluded its third quarter with 2.17 million subscribers and landed 359,000 new accounts for the period. XM did substantially better. It added 617,000 new listeners to close out the quarter with 5.03 million.

It's clear that XM is the market leader. It has signed up more new subscribers over the past year than Sirius has in its entire existence. However, if both companies nail their fourth-quarter targets, things are going to get interesting.

XM expects to wrap up the year with 6 million subscribers. Sirius is projecting a base 3 million strong. Those forecasts suggest that XM expects 997,000 new members over these next three months while Sirius counters with 830,000. Yes, XM would still win and grow its lead even further. However, Sirius would be setting itself up nicely for what should be another strong showing for the March quarter, once Stern's satellite radio antics begin circulating around the water cooler come January.

Sirius can't afford to blow this opportunity. The company's market cap has appreciated by more than $3.8 billion since it announced that it signed Stern last year. Right now, Sirius commands a market cap that is slightly greater than XM's despite looking to own just a third of the satellite radio market by the end of the year. These next two quarters will either justify the premium in Sirius' shares or send them lower if Sirius isn't able to nab more new subscribers than XM once Stern is settled in.

Sirius expects cash-flow profitability to arrive as early as the fourth quarter of next year, but it is over the next few months that investors will decide on the company's value.

Back in January, I made some bold predictions about some surprises that 2005 had in store. One of my more boneheaded calls was that Sirius would sign up more new subscribers than XM would in the December quarter. It looks like I'll miss that mark, though not by a whole lot. Keep in mind that during last year's fourth quarter, XM signed 700,000 new users to the 440,000 that Sirius rounded up. Over the past year, Sirius has clearly improved its chances. Then again, I badly blew other predictions in that piece as well. Apple Computer (NASDAQ:AAPL) is not going to close out the year lower. Krispy Kreme (NYSE:KKD) is not going to be the comeback story of 2005. It looks like I'll be right about (NASDAQ:AMZN) not entering the stateside DVD-rental market alone, and the jury is still out on TiVo (NASDAQ:TIVO).

So get busy, Sirius. Otherwise, pass the salt shaker so I can get ready to start swallowing my words.

Amazon, TiVo, and Krispy Kreme have all been recommended by the Motley Fool Stock Advisor newsletter service.

Longtime Fool contributor Rick Munarriz is a Sirius subscriber, but he does not own shares in any of the companies mentioned in this story. T he Fool has a disclosure policy. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.