The Basics

Satellite radio is an idea over a decade in the making. In 1992, the U.S. Federal Communications Commission (FCC) allocated a spectrum in the "S" band (2.3 GHz) for nationwide broadcasting of satellite-based Digital Audio Radio Service (DARS). Only four companies applied for a license to broadcast over that band. The FCC gave licenses to two of these companies in 1997. CD Radio (now Sirius Satellite Radio) and American Mobile Radio (now XM Satellite Radio) paid more than $80 million each to use space in the S-band for digital satellite transmission.

At this time, there are three space-based radio broadcasters:

  • Sirius Satellite Radio
  • XM Satellite Radio
  • WorldSpace
Satellite radio companies are comparing the significance of their service to the impact that cable TV had on television 30 years ago. Listeners won't be able to pick up local stations using satellite radio services, but they will have access to hundreds of stations offering a variety of music genres. Each company has a different plan for its broadcasting system, but the systems do share similarities. Here are the key components of the three satellite radio systems:
  • Satellites
  • Ground repeaters
  • Radio receivers

Satellite radio works a lot like satellite TV -- you purchase a receiver and pay a monthly subscription fee for a certain number of channels. For the moment, there are slight variances in the three satellite radio companies' systems. In the next three sections, we will profile each of the companies and their current satellite radio services.

The XM/Sirius Merger
Both XM and Sirius offer about 100 channels under their current plans. If both the FCC and the Department of Justice approve their proposed merger, though, things might change a little. According to the two companies, the merged company will offer a few options. You could subscribe to 50 channels from either XM or Sirius for $6.99, or you could get a "best-of" package of 100 channels selected from both networks for $14.99. If you're already an XM or Sirius customer, you wouldn’t have to replace your old radio. However, if you wanted to pick and choose your own channels from both networks, you would have to pay a little extra and purchase a new receiver. This all depends on whether the merger is approved, and as of October 2007 there have been no decisions. ­­