Sky's the Limit for Launch of Satellite Radio
Sirius, XM begin broadcast battle, partnering with car makers and content providers for nationwide transmissions.
Ashlee Vance, IDG News Service
LAS VEGAS, NEVADA -- By midyear, your selection of music and news could stretch far beyond local radio stations and your CD collection, when two competing satellite radio systems begin beaming their original stations to consumers, often in cars.
Both Sirius Satellite Radio and XM Satellite Radio Holdings previewed their breakthrough audio equipment at the Consumer Electronics Show here this week.
Through satellite radio technology, you'll be able to receive nationwide signals from broadcasts delivered by Sirius and XM. Unlike a standard radio signal that fades after a certain distance, tunes delivered by satellite radio are constantly accessible regardless of location. Sirius and XM built their own broadcast studios and will deliver a mixture of original and licensed content. Each expects to charge about $10 monthly for a subscription to all stations in their respective lineups.
Building Partnerships
Sirius already has three satellites in orbit over North America. The company will use the satellites and a broadcast studio in New York to transmit 50 commercial-free music stations along with 50 channels of news, sports, talk, comedy, and children's programming. The company is teaming with Ford, DaimlerChrysler, and BMW to put Satellite radios in cars by the middle of this year.
You'll soon be able to get Sirius service bundled when you buy or lease a new car. Content providers such as CNBC, BBC Worldwide, and A&E Television Networks will broadcast programs on some of the 50 nonmusic channels.
XM is launching its first of two satellites this month. While behind in the satellite race, XM unveiled at CES 24 different models of satellite-radio-ready radios, from Sony, Pioneer, Alpine Electronics, and others. One Sony unit can be used in both the car and at home. The device connects to your cassette player, is about the size of a car radar detector, and fits into a sleeve mounted the car's dashboard. The radios from Pioneer and Alpine cost about $150 more than current radios and will go directly into the car's audio slot.
"We are going to do to the radio what cable has done to the television industry," said Hugh Panero, XM's president and chief executive officer.
Both companies consider satellite radio a way to provide very content-focused radio stations. For example, a classic rock fan could select among five or six different types of classic rock, and listen to the same stations while cruising from New York to California. Or, country music fans who usually have a limited selection of local stations could choose from several at any time.
XM expects to deliver about 60 channels of music with around six minutes of commercials per hour. Cable News Network, BBC World Service, and Black Entertainment Television will provide some material for XM's nonmusic channels. General Motors and Honda will soon build XM's radios into their cars. The XM service will also cost just under $10 monthly.
Few Rivals, for Now
Only Sirius and XM have licenses for the S-band of the spectrum, auctioned by the Federal Communications Commission in 1997. Each paid about $90 million for rights to broadcast 100 channels.
The rivals say their technology will withstand the oncoming threat of Internet radio. They claim it will be years before consumers can receive streaming audio in cars at the same quality as Satellite broadcasts.
Once enough bandwidth arrives, however, the Internet will funnel radio stations from anywhere in the world, not just the 100 channels of U.S. oriented programming planned by these pioneers in satellite radio.
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