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Satellite Radio

Satellite radio is a technology through which a consumer can receive streaming channels of music and/or talk to a special receiver (see Figure 11.6). Even though it is connected to the word “radio,” the activity has little to do with the technology of broadcasting as it developed over the past century. In 2008, the two competing players in the satellite-radio market, Sirius and XM, merged to become Sirius XM Radio. Sirius XM makes money from subscription (about $20 a month) as well as through advertising on some of the hundreds of channels it offers, with a wide variety of formats. The company produces the programs, sometimes in joint ventures with other firms (Oprah's Harpo Productions, for example, produces Oprah and Friends for the XM channel). The channels are uploaded to satellites and can be picked up in most places around the country by receivers that stores such as Best Buy sell. In addition, equipment. Some of the equipment is portable, making it possible to listen at home and while outdoors, not just in the car.

1. Sirius and XM both produce live and taped programming, ranging broadly from Alanis Morissette to sports and news.

2. The programming is beamed to satellites from dishes operated by each company.

3. The satellites broadcast the signal back to Earth, where it's picked up directly by receiver units. The signal is also received and rebroadcast by repeater stations in metropolitan areas. XM uses two geostationary satellites (right) that remain constantly above the United States. Sirius uses three satellites, two of which are always over the country.

4. A receiver buffers the broadcast for a few seconds, so if it loses the satellite signal it can use one from a repeater station, helping ensure a continuous broadcast. Overpasses and tall building are particular problems.

Sirius XM has made deals with major car companies to offer their receivers as original In the years leading up to the merger, observers worried that the combination could create a behemoth that would set prices and squeeze consumers. Yet by early 2008, Sirius XM had 19 million subscribers, not a small number but not the large proportion of the population some had predicted. Ominously for the firm, several years of high growth seemed to be slowing, and most new subscribers entered because of a free year of programming that came with a new car they bought. Even more problematic, the company had owed $3 billion to creditors by 2008, and only a last-minute investment by Liberty Media Corporation saved it from bankruptcy. Radio-industry analysts now believe that, although satellite radio may have an enduring role to play in the U.S. media system, it is not a fundamental threat to broadcast radio.