What is Satellite Radio?

Satellite radio is just what its name suggests: a radio service that uses a satellite circling Earth to broadcast its programming. In 1992, the Federal Communications Commission (FCC) allocated a satellite spectrum (the "S" band, 2.3 GHz) for the broadcasting of satellite-based Digital Audio Radio Service (DARS). It eventually granted two licenses, one to Sirius (formerly CD Radio) and one to XM (formerly American Mobile Radio). The world's biggest satellite radio provider, WorldSpace, is available in Europe and other countries but not in the United States.

Satellites orbit the earth. Programs are beamed to the satellites, which transmit the signal to a special antenna on homes and cars. Terrestrial repeaters throughout the country also receive the signal. They help ensure that the signal is transmitted to receivers, especially in areas with tall buildings that might block the signal.

For about $13 a month, plus $100 or so for the equipment and a small activation fee, both Sirius and XM listeners can receive more than 100 channels of satellite radio, including music ranging from classical to heavy metal, plus news, sports, talk and entertainment. But there are some notable differences between the two services.