wo digital radio systems [see table], operated by Sirius Satellite Radio Inc., based in New York City, and XM Satellite Radio Inc., in Washington, D.C., share a number of similarities--like approximately the same number of separate radio channels--as well as some interesting differences--for example, completely different orbital configurations for their satellites. But whether the for-pay SDARS offerings will lure listeners away from the free terrestrial service is an open question. On an advertiser-supported local station, many program formats with a limited audience could never be economically viable. SDARS' operators maintain that even narrowly specialized programming will be feasible over a service that reaches the entire nation and is supported almost entirely by subscriptions. (Sirius plans to be commercial-free; XM plans to include advertisements in its news/talk programs.) Reach is clearly the main strength of the satellite delivery medium. Radio markets (primarily rural), now under-served by radio services with only a handful of stations, will no doubt welcome the choices offered to them by satellite radio.How it works Satellite radio is an idea nearly 10 years 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 in various stages of development: Sirius Satellite Radio Sirius Satellite Radio is now operational in the United States, but is still carrying out quality assurance tests. It is not yet a...
