The Future of Satellite Radio

So what does the future hold for Sirius and XM Radio? It's unclear whether one will come out the clear winner in the satellite market, but experts say the business as a whole will boom in coming years. The biggest growth area for satellite radio companies is with new car buyers. General Motors is currently installing XM in 55 of its 2005 car models. The company also has deals with Honda and Hyundai. Sirius' partners include DaimlerChrysler, Ford and BMW.

The biggest impediment to satellite radio may be the iPod and other personal music devices, which enable consumers to download and carry around thousands of songs anywhere they go.

Photo courtesy Apple Computer, Inc., XM Satellite Radio Apple iPod 30-GB MP3 Player (left) and Delphi MyFi

XM has fought back by introducing the MyFi personal satellite receiver, which can hold up to five hours worth of music. Sirius' current portable model, the XACT Stream Jockey, doesn't fit quite so snugly into the handheld market. While it is a portable reciever, it's simply too big to compete with pocket-sized portables. Sirius head Mel Karmazin spoke with Apple chief executive Steve Jobs in 2005 about adding the satellite service to the iPod, but Jobs reportedly wasn't interested. Sirius isn't giving up, though -- they should have smaller portable receiver out sometime later this year.

Will satellite radio replace your favorite FM stations? Despite its growing popularity, that's not likely, say experts. Traditional radio still boasts more than 200 million listeners -- 50 times more than satellite radio's current subscription base. Odds are that satellite service will complement free radio, just as cable television now complements the broadcast networks.

For more information on Sirius, XM and related topics, check out the links on the next page.