The history of portable satellite radios is short compared to traditional over-the-air radio, but it has rapidly changed the face of radio listening like no other technology in recent memory. The two major satellite radio services, XM Satellite Radio and SIRIUS Satellite Radio, offer a stunning array of programming and compete fiercely for customers.
Their popularity has stunned many in the radio industry and with the advent of new, smaller, more convenient portable satellite radios, some industry veterans worry about the future viability of traditional broadcast radio.
How did satellite radio get started and what is its future? Let’s take a look.
The Beginnings of Satellite Radio
The history of satellite radio begins in 1992, when the Federal Communications Commission (FCC) decided to set aside a portion of spectrum to be devoted to nationwide distribution of digital radio service via satellite. SIRIUS Satellite Radio and XM Satellite Radio bid huge amounts of money (at least $80 million each) for licenses to use this new allocation of spectrum, which were eventually awarded to them by the FCC.
Owning the right to use the spectrum, though, was only the first step. Even if they could start delivering satellite radio signals right away, there were no consumer-accessible portable satellite radios to receive the signal. Additionally, there was substantial debate within the radio industry about whether consumers would be willing to pay for new hardware and then pay a monthly subscription fee for radio service. After all, AM and FM radio broadcasts were available free all over the country.
Making a Business out of Satellite Radio
XM Satellite Radio and SIRIUS Satellite Radio set out to overcome these obstacles and make a real business out of portable satellite radios and satellite radio programming. They knew that to attract the most consumers they needed to offer a variety of hardware components that could be used in a variety of locations – home, work, and especially the car, where most radio listening occurs.