One year ago this week, fellow Fools Tim Beyers and Alyce Lomax sounded their horns and rode into battle over satellite radio service provider Sirius (NASDAQ:SIRI). The dust has long since settled, and it's time to reevaluate the battle in the light of recent events. Did the right Fool win?

The bull run
Tim led the bull charge, asserting that the relative valuation techniques that made Sirius look so expensive don't really work when applied to unprofitable companies like this one. Instead, he looked at CEO Mel Karmazin's then-recent $10.7 million share-buying spree as an indication that the people who know the company best saw a deep, rich value in a beaten-down stock price.

"That's a cost basis of $5.35 per stub," said Tim, "which puts him down roughly 21% as I'm writing this." Hold that thought.

As a "strong second-stringer in a duopoly" with rival XM Satellite Radio (NASDAQ:XMSR), Tim saw more growth opportunity than risk for Sirius. He noted that if things should turn out negative in the end, "Karmazin -- you know, the guy who helped resuscitate CBS television -- has just blown $10.7 million. You'll forgive me if I give him more credit than that."

Beary funny
Alyce didn't agree with the duopoly theory. There are so many other entertainment choices on the market these days, she argued, that satellite radio might well become a mere footnote in radio history. "Apple's (NASDAQ:AAPL) still got iPod mania on its side," she said. "Just think how many folks plug their iPods into their car stereos instead of turning on the radio. And of course, there's no shortage of services trying to woo listeners, like Napster (NASDAQ:NAPS) and RealNetworks (NASDAQ:RNWK)."

And those were just the digital alternatives. Old-school radio might get its act together again and put the smackdown on these orbiting upstarts. And then there was a shaky macroeconomic picture to contend with, hyperinflated real estate prices, dwindling consumer confidence, and rising gas prices putting pressure on consumer pocketbooks. "Satellite radio is a fun technology," said Alyce, "but I can't imagine it's a need-to-have product when penny-pinching is in order."

Reality sets in
With that, it was time for the reader vote, and Tim came through with flying colors. 70% of 475 voters took his bullish side, versus 21% for Mlle. Lomax, and 9% voicing their indecision. Case closed -- right?

Not so fast. A little thing called market reality decided to step in and change the picture drastically. In the year that followed, Sirius stock lost another 34% of its value -- the share price sits at $2.81 per stub as I write this. Karmazin's cost basis isn't looking too attractive these days.

On the other side of the fence, XM hasn't done much better. Its stock price has dropped 20% over a period when the S&P 500 gained 20%, making both of the duopolists lousy one-year investments.

The two companies are doing their best to push a merger of equals through the FCC regulatory process to cut down on common overhead, presenting a united satellite front to customers. But FCC chairman Kevin Martin seems unimpressed by their arguments, and most observers think the deal will fall apart eventually.

Another Foolish colleague, duel-master supremo Rick Munarriz, just examined the new $250 million loan Sirius took out, concluding that the company is planning to soldier on without its rival-turned-sweetheart.

We'll have to call this one a tie, with Tim taking the popular vote and Alyce the market-performance crown, and leave it at that for now. I don't have a re-duel available to break this knot like we did last week -- but I hear there might be one coming up soon. Shhh! Stay tuned.

Plug in and rock out:

A year ago, XM was a Motley Fool Rule Breakers selection -- but the stock has been kicked off our hypergrowth service's scorecard in the meantime. Find out what happened with a free 30-day trial pass.

Fool contributor Anders Bylund holds no position in any of the companies discussed here. You can check out Anders' holdings if you like, and you can hear Foolish disclosure pumping on your stereo in glorious digital X-Fi.