The stock of satellite-radio service provider WorldSpace Inc. took a beating on the U.S. Nasdaq exchange following release of the company’s fourth-quarter financial results and a conference call that left questions unanswered about WorldSpace’s success in India, currently its prime market.

Rockville, Md.-based WorldSpace, which raised $221 million in August from an initial public offering (IPO) of stock, says it will take several more months before it can correctly measure its performance in India.

WorldSpace Chief Executive Noah A. Samara said during the March 16 conference call with investors that “double-digit millions of subscribers is achievable” in India, and that early market response to WorldSpace’s gradual service introduction is encouraging.

But Samara and WorldSpace Chief Financial Officer Sridhar Ganesan said it is too early to provide investors with precise figures on subscriber-dropout rates, and on whether subscriber additions are dependent on introductory discounts and promotions that WorldSpace is using in India.

WorldSpace’s stock traded as high as $26.00 per share immediately after the August IPO. It then gradually dropped and has fluctuated at between $10 and $15 per share over the past six months.

The market’s reaction to the conference call was immediate. Two investment brokerages downgraded WorldSpace and the stock dropped more than 40 percent in the following week, stabilizing after another investment bank said the sell-off had been excessive.

WorldSpace reported year-2005 revenue of $11.7 million, a 36-percent increase over 2004 mainly on the strength of subscriber growth in India. The net loss for 2005 was $79.9 million, compared to a net loss of $577 million the previous year.

WorldSpace operates two satellites providing L-band radio service over a broad area including most of Europe and Asia. The company has received U.S. regulatory approval to launch a second satellite over Africa and Europe, and it has a fully built spacecraft in storage at Alcatel Alenia Space’s production facility in France. The satellite would require several months of refurbishment before being launched.

Samara said the decision by the U.S. Federal Communications Commission (FCC) to approve the launch of a backup satellite over Europe and Africa means that WorldSpace is in a dominant position to offer L-band radio in Europe.

“There is only spectrum for one system in Europe,” Samara said. “Our current satellite uses most of the L-band [regulatory] allocation in the region, and enjoys a regulatory priority over any future systems. Therefore, it will be difficult for anyone else to launch an L-band satellite for satellite radio in Europe.”

Ondas Media of Spain continues to battle WorldSpace at the FCC, but Ondas officials say their proposed satellite-radio service over Europe can survive despite the approval of a second WorldSpace satellite over Europe.

As was the case for XM Satellite Radio and Sirius Satellite Radio in the United States, WorldSpace will need regulatory approval to deploy a network of ground-based signal amplifiers in the nations in which it operates if it wishes to broaden its service offering to include a mobile service in automobiles.

It has received government authorization for such signal boosters in Bahrain and the United Arab Emirates — but not yet in India or Europe.

Samara said WorldSpace would deploy its service in Europe in a single nation at first, with approval for terrestrial signal amplifiers expected in 2008.

Andy Ras-Work, WorldSpace’s chief operating officer, said the company hopes to receive an experimental license in India to deploy terrestrial repeaters in a limited area. A full license for nationwide rollout would follow, he said, without giving specific dates.

While waiting for its mobile products and licensing approvals, WorldSpace is opening retail sales outlets, and collecting bills door-to-door in several large Indian cities.

The company has been offering gimmicky discounts during India’s festival season, with customers receiving subscription-price reductions if they bring household appliances to the WorldSpace stores. Appliances can include televisions and steam irons.

“We need to see several cycles” of subscription rates during and after promotions before being able to judge whether customers like the service and are willing to pay for it, Ganesan said.