XM Satellite Radio:An Innovation Beyond AM and FM Radio
XM Satellite Radio:An Innovation Beyond AM and FM Radio
-- Mary Tuttle
Lee Abrams, an FM radio legend for more than 30 years and pictured on the left, is the man who dreamed up XM's 100 channels. He thinks XM can find that perfect song at the perfect moment for enough paying listeners that it can became a sustainable business.
He arrived at XM five years ago, saved from what he believed had become the wasteland of FM. At XM, he was told to create a new kind of radio. There would be no howling morning shows, no dumbed-down deejay nonsense and almost no commercials. It would be like starting HBO all over again, except starting with what HBO has become -- the sophisticated "Sopranos," not the polka shows and second-rate movies that marked the channel's early days.
The official XM satellite radio website says, "When XM was founded in
1992 as American Mobile Radio Corporation, only a few visionaries
understood the potential of satellite radio. Today, radio listeners are
joining with XM's strategic partners and staff to make radio better - to make history" (XM Satellite Radio, 2001).
In November 2001, GM became the first automaker to offer XM as a factory-installed option on 2002 Cadillac DeVilles and Sevilles (pictured right and far-right, respectively). For the 2003 model year, GM expanded to 25 car, truck and SUV models, and Cadillac was the first division to offer XM across its entire product portfolio.
The Satellite Radio headquarters (pictured left) is set up in our nation's capital and has a 150,000 sq. ft. facility equipped with more than 80 all-digital broadcasting studios. This 65 million dollar location also houses two 7-meter satellite dishes. There are currently more than 1,500 hours of live programming every week connecting over the XM Radio band. This business boasts more than 360,000 clients, from as far west as Honolulu, HI to as far east as Bangor, ME (Mitsis, 2003). This demonstrates the availability and the popularity of this new industry across the United States.
Then, in 2001, a major development within the industry came about with the merger of General Motors and the XM Satellite Radio industry. The two companies came together and set up a deal to add the availability of the XM Radio in the 40 GM models starting with the 2003 new models. This being decided, the Cadillac division of GM took the first leap in 2002 and offered the option in the DeVille model. The results were quite successful. In late December, the XM Radio industry announced a set of agreements for 475 million dollars worth of business within the auto industry within the upcoming year (Mitsis, 2003). The three powerhouses within the industry such as Honda, Toyota, and GM Motors were the companies structured within this deal. These factors are all major developments within our media industry, which is helping catapult the radio industry into the next generation.
"Our ability to generate revenues and ultimately to become profitable will depend upon several factors, including whether we can attract and retain enough subscribers and advertisers to XM Radio; whether our XM Radio system continues to operate at an acceptable level; whether we compete successfully; and whether the FCC grants us all additional necessary authorizations in a timely manner" (XM Satellite Radio Stock Report, 2003).All of these things seem to be in order, and XM Radio is taking off quickly. However, the future of this newfangled radio system isn't as wonderful and magical for some who are losing their jobs. XM Satellite Radio will result in the downsizing and eliminating of many local radio stations, and the DJ's, producers, and other employees who work there. Instead of two rock stations in every major city, there may be only 4 or 5 nationwide if XM takes over. Only a few of the best DJ's will be syndicated nationally. And even in this case, the necessity for DJ's is quickly dropping. Less information is needed about the artist and song title, because the identification will come up automatically. Since XM will be funded by direct payment from consumers, rather than advertisers, no promotions or fundraisers or local contests will be necessary. No one will need to introduce the next commercial break. And if listeners want to tune in just to hear someone's voice, they can simply select a news/talk channel, rather than a music station. Local businesses will also be affected by XM radio. Small companies will not be able to afford one of the few advertising slots on a nationwide station. So with less publicity, their profits will most likely drop greatly - unfortunately, we can't rely on word of mouth to get the consumers anymore.
-- Mary Tuttle
Jarret Tobin - Writer Mary Tuttle - Proofreader Matthew Verlei - Group Leader & Proofreader Alysia Vigliucci - Writer Jennifer Vladic - Writer Amanda Ward - Proofreader Theresa Ward - Writer Daniel Wasik - Web Page Designer
Glanz, W. (2001, May 7). Broadcaster Wishes on Star: XM's Satellite Set for Launch, Will Take Radio to New Heights. Washington Times, pg D8. Mitsis, Nick. (2003, March). Satellite 2002 Executive of the Year. Via Satellite 26-32. Morris, R. (2003, April 3). XM discussion [Article posted on Web Site XMFan]. Retrieved March 2003, from the World Wide Web: http://www.xmfan.com/viewforum.php?f=2 XM Satellite Radio. (2001). History [Article posted on Web Site XMradio]. Retrieved April 2, 2003, from the World Wide Web: http://www.xmradio.com/corporate_info/history_main.jsp XM Satellite Radio.(2001). How it works: Introduction [Article posted on Web Site XMradio]. Retrieved February 1, 2003, from the World Wide Web: http://www.xmradio.com/how_it_works/introduction.html XM Satellite Radio Stock Report. (2003, February) XM Satellite Radio Business Profile [Article posted on Web Site YahooFinance]. Retrieved February 2003, from the World Wide Web: http://www.biz.yahoo.com/e/011206/xmsr.com
