XM Satellite Radio

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Template:Infobox Company$558.266 Million USD (2005) |

net_income =Template:Loss-$675.312 Million USD (2005)|
num_employees = 710 (2005)|
homepage = www.xmradio.com, www.xmwxweather.com

}}

XM Satellite Radio Holdings (XM) Template:NASDAQ is a satellite radio (DARS) service in the United States and Canada. XM provides pay-for-service radio, analogous to premium cable television. Its service includes 69 different music channels, 39 news, sports, talk and entertainment channels, 21 regional traffic and weather channels and 23 play-by-play sports channels. XM channels are identified by Arbitron with the label "XM" (e.g. "XM175", "XM4", "XM32"). Meanwhile, AOL Radio, a division of America Online's media sector, offers select XM Satellite Radio channels streamed live through Winamp, AOL Instant Messenger Triton, and AOL Radio, free of charge.

XM was founded in 1992 as American Mobile Radio Corporation.

Contents

Services

XM-capable receivers cost US$30 – US$300. If opting for the month-to-month plan, service fees are US$12.95 for the first receiver, and US$6.99 each for up to four additional receivers on the same account. Subscribers may opt to purchase one-, two-, three-, four-, or five-year packages, in which the average monthly cost would be under US$10.00 per month. XM Satellite Radio produces the majority of its channels, as well as a few others that are not available via satellite, available on the Internet. The Internet-only subscription fee is US$7.99 per month; those with an active satellite subscription do not need to pay an additional charge. XM is currently the only satellite radio service to offer true mobile services, utilizing the built in antenna in its MyFi to transmit a live satellite signal to iPod-sized battery operated devices.

XM also provides data services such as weather information for pilots and weather spotters through its XM WX Satellite Weather datacasting service, in addition to real-time weather and traffic updates aired every two minutes for major metropolitan areas on some of XM's audio channels.

DirecTV now gives listeners as part of its service the music and talk channels of XM, but not the news or traffic channels.

XM also offers music downloads though XM+Napster. This service is being integrated with XM Online and the new XM receivers, Inno & Helix.

In January 2006, JetBlue Airways started carrying XM Radio on their aircraft. United Airlines followed suit, starting in March 2006.

Company timeline

Year Event(s)
1988
  • American Mobile Satellite Corp. is founded.
1991
  • American Mobile Radio/XM co-founder Lon Levin joins American Mobile Satellite Corp.
1992
1996
1997
  • May 16: American Mobile Satellite and WorldSpace officially change the name of American Mobile Radio to XM Satellite Radio. Later that month, Lon Levin, who was politically instrumental in the early years of establishing American Mobile Radio, becomes its President until 1998; he would remain on until 2005 in an influential VP role in charge of Government Regulatory.
  • October: XM Satellite Radio obtains one of only two satellite digital audio radio service licenses offered by the Federal Communications Commission. Together with CD Radio (SIRIUS), the two successfully beat out Primosphere Limited Partnership and Digital Satellite Broadcasting Corporation as licensees.
1998
1999
  • June: Clear Channel Communications, DirecTV, General Motors, and a private investment group invest $250 million in XM Satellite Radio convertible debt. Both Clear Channel and DirecTV agree to develop services for XM.
  • June 7: with GM's investment in XM, they enter into a 12-year "Distribution Agreement" between XM and GM subsdiary, OnStar Corporation. The agreement calls for exclusive installation of XM Satellite Radio into GM vehicles from November 12, 2001 until November 2013. OnStar must meet specific escalating installation rates each year, while XM must make extensive payments to OnStar for the installation and sale of XM in their vehicles, while sharing revenue earned from these radios with OnStar – as well as payments on the exclusivity agreement.
  • July 7, American Mobile Satellite, still XM's parent company, uses approximately $75 million of the proceeds from the private investment to reacquire the 20% interest WorldSpace holds. In October, XM Satellite Radio issues 10,241,000 shares of Class A common stock at an IPO price of $12.00 per share. American Mobile Satellite remains the majority holder of the public company.
2000
  • April: American Mobile Satellite Corp. changes its name to Motient. In July, American Honda join several private investors in a $235 million preferred stock investment in the company.
2001
  • September 25: XM Satellite Radio service launches, first in San Diego and Dallas/Fort Worth, and spreads across the United States. The initial lineup includes 71 music channels and 29 other channels consisting of sports, talk, children's programming, entertainment and news. The original launch date of September 12 is pushed back after the World Trade Center and Pentagon terrorist attacks.
  • October: with Motient heading into bankruptcy, they spin off their non-XM satellite division into a joint operation with TMI Communications and Company, L.P., a wholly owned subsidiary of BCE Inc. of Canada; the new venture is known as the Mobile Satellite Ventures.
  • November: with Motient in bankruptcy, they sell off their controlling interest in XM to Hughes Electronics, Singapore Telecommunications and Baron Capital Partners. This ends Motient's interest in XM and begins XM's history as a stand-alone company. Hughes Electronics would go on to combine this new interest in with the interest already held by their subsidiary, DirecTV.
  • November 12: XM Satellite Radio marks the official launch of full nationwide service.
  • December 31: XM Satellite Radio ends the year with 27,733 subscribers.
2002
  • December 31: XM Satellite Radio ends the year with 347,159 subscribers.
2003
  • January: with the launch and rollout taking longer and more costly than expected, the company undergoes a large and complicated re-capitalization plan. The plan involves XM exchanging $300 million in old debt for new debt, while deferring interest for 3-years on the notes; as well as restructuring the payment obligations on the General Motors installation agreement, issuing a convertible bond to GM, issuing a warrant for shares to GM, and establishing a revolving credit facility with GM; and finally the plan included new funding coming from a placement of over $300 million in 10% convertible bonds to a group of private investors.
  • July: the company has nearly 700,000 subscribers.
  • December 31: XM Satellite Radio ends the year with 1,360,228 subscribers.
2004
  • January through March: with the sale of Hughes Electronics from General Motors to Rupert Murdoch's News Corp., DirecTV's interest in XM Satellite Radio is sold off on the market.
  • February 2: XM Radio announces 100 percent commercial free music lineup.
  • March 1: XM Radio launched Instant Traffic and Weather Channels for major metropolitan markets in the United States.
  • August 11: XM Radio subscriber base breaks the 2.5 million mark. The company partners with luxury automakers (Acura and Audi) as well as General Motors, Honda, Isuzu, Nissan, Toyota, Volkswagen, and SAAB) to offer in-dash XM receivers on an OEM basis. The Acura TL is the first luxury automobile to offer XM radio as "standard" in every vehicle.
  • October 4: "shock" jocks Opie and Anthony begin broadcasting on a premium ($1.99/month extra) XM Satellite Radio station. Also, former National Public Radio host Bob Edwards broadcasts the first Bob Edwards Show on XM Public Radio, channel 133.
  • October 20: XM announces an 11-year, $650 million deal with Major League Baseball to broadcast games live nationwide and become the Official Satellite Radio provider of Major League Baseball. The agreement grants XM the rights to use the MLB silhouetted batter logo and the collective marks of all major league clubs. As part of the deal, XM creates a 24/7 MLB channel called "Home Plate". The deal starts with the 2005 season and runs through the 2012, with a 3-year option that MLB can pick up.
  • October 26: XM presents its first XM2go™ portable XM receiver: The Delphi MyFi™.
  • December 31: XM Satellite Radio ends the year with 3,229,124 subscribers.
2005
  • January 5: XM introduces two new XM2go™ models: Pioneer's AirWare™ and the Tao™ from Giant International.
  • February 28: XM's third satellite, Rhythm, is launched successfully.
  • April 1: XM announces that it has added 540,000 subscribers in Q1 2005, pushing their total subscriber base to 3.77 million.
  • April 11: XM announces that a deal has been reached to be the official satellite radio network of Air America Radio.
  • May 16: XM announces that subscribership has topped 4 million. This indicates exponential growth for the company. In five weeks time, they added 230,000 subscribers — almost 50% of the subscribers added during the previous quarter.
  • May 28: the Wall Street Journal reports that XM has awarded the contract for the XM 5 spacecraft to Space Systems/Loral [1].
  • June 7: XM partners with Audible.com to offer downloadable audio show archives of The Opie and Anthony Show, as well as The Bob Edwards Show.
  • July 1: XM announces it has added more than 640,000 subscribers in Q2 2005, pushing their total subscriber base over 4.4 million.
  • August 1: XM announces the addition of popular radio hosts Ron and Fez.
  • September 12: Ron and Fez join Opie and Anthony on High Voltage XM 202.
  • September 13: XM announces a 10-year $100 million deal to carry National Hockey League broadcasts beginning with the 2005-06 season, initially sharing the coverage with SIRIUS but gaining satellite-radio exclusivity from 2007 onward.
  • September 27: XM announces it has surpassed 5 million subscribers.
  • October 3: XM announces that they have added more than 617,000 new net subscribers during Q3 2005.
  • October 3: XM Satellite Radio launches channel "Take 5" (XM 155). The channel is geared toward Women's Programming and features replays of The Ellen DeGeneres Show, The Tyra Banks Show, syndicated and original programming, as well as programming from the Food Network and HGTV. Additionally, XM Radio drops two of its Talk and Entertainment channels: MTV and VH1. XM adds 617,000 subscribers in Q3 2005, pushing the total subscriber base to over 5.03 million.
  • October 18: XM announces it will launch Fox News Talk in January 2006.
  • November 15: DirecTV begins broadcasting 72 channels as part of their audio programming. This includes music channels, "Home Plate" (XM 175), and "High Voltage" (XM 202) but no news or sports channels.
  • November 17:, XM launches their new Fall lineup of channels: "unSigned", "Air Musique", "Sur La Route", "Laugh Attack", "Canada 360", "Quoi de Neuf", "Franc Parler", and "Home Ice".
  • November 29: XM launches service in Canada.
  • December 31: XM Satellite Radio ends the year with 5,932,957 subscribers.
2006
  • January 2: XM launches Fox News Talk, including commentators Bill O'Reilly, Tony Snow, John Gibson, and Alan Colmes.
  • January 4: XM announces it has surpassed 6 million subscribers.
  • January 9: XM wins top honors at the 2006 Consumer Electronics Show in Las Vegas for their two new portable units that offer live programming on-the-go. The new radios are the XM Pioneer Inno and Samsung Helix. They expect to be released during the end of March or beginning of April.
  • February 9: XM announces they have signed a $55 million three-year deal with Oprah Winfrey's Harpo Productions. A new channel called "Oprah and Friends" will launch in September, which will be programmed by Winfrey and originate in the Harpo Studios in Chicago. The channel will feature programs hosted by a team of personalities who appear on her television show including Gayle King, Dr. Mehmet Oz, Marianne Williamson, Dr. Robin Smith, Bob Greene and Nate Berkus. As part of the agreement, Oprah will appear in a weekly 30-minute program along with friend Gayle King. The program will air 39-weeks a year and feature taped phone conversations between Winfrey and King.
  • March 1: XM launches channels "49 Big Tracks", "84 XM Chill", and "173 WLW" giving them 69 commercial free music channels, with the addition of WLW, a news talk channel.
  • March 10: XM announces that the music stations programmed by Clear Channel ("21 Kiss XM", "22 Mix XM", "11 XM Nashville", and "24 XM Sunny") will begin airing some commercials beginning in April. This was a decision made by Clear Channel. In response, XM promises to add it's own commercial-free versions of these channels in the near future.
  • April 17: XM Launches 8 new Commercial Free Music Channels. The channels are, "XM 17 - U.S. Country" (commercial-free alternative to "Nashville"), "XM 26 - Flight 26" (commercial-free alternative to "MIX"), "XM 30 - XM Hitlist" (commercial-free alternative to "KISS"), "XM 34 - enLighten", "XM 42 - XM Liquid Metal" (brought back to the satellites after being an Online-exclusive for over a year), "XM 68 - The Heat", "XM 78 - Escape" (commercial-free alternative to "Sunny") and "XM 91 - Viva." On the same date, DirecTV changed its channel lineup to focus in on XM's commercial-free music too, which resulted in the removal of two XM talk channels, the addition of 4 new music channels and the replacement of the four Clear Channel programmed music channels that began airing commercials. Removed from DirecTV were XM's MLB channel "Home Plate" (DTV Channel 878) and "High Voltage" (DTV Channel 879). Added were "The Heat" (DTV Channel 825), "enLighten" (DTV Channel 828), "Liquid Metal" (DTV Channel 841) and "Viva" (DTV Channel 876). Replaced were "Nashville" (DTV Channel 809), "Kiss" (DTV Channel 817), "Mix" (DTV Channel 818), and "Sunny" (DTV Channel 820); DirecTV replaced those channels with the afforementioned new commercial-free versions programmed directly by XM, "U.S. Country," "XM Hitlist," "Flight 26," and "Escape", respectively.

Technology

Image:Xm radio headquarters2.jpg XM provides digital programming directly from three satellites in geostationary orbit above the equator. XM-1 ("Roll") and XM-2 ("Rock") are co-located at 115 degrees west longitude and XM-3 ("Rhythm") is located 85 degrees west longitude in addition to a network of ground-based repeaters. The combination of three satellites and a ground-based repeater network is designed to provide gap-free coverage anywhere within the continental U.S. Unfortunately, XM-1 and XM-2 are suffering from a generic design fault on the Boeing 702 series of satellites, which means that their lifetimes will be shortened to approximately six years (instead of the design goal of 15 years). To compensate for this flaw, XM-3 was launched earlier than anticipated and moved into XM-1's previous location. XM-1 was then moved over next to XM-2, where each satellite operates only one transponder to conserve energy.

In American and Canadian metropolitan areas, XM and its Canadian Licensee known as Canadian Satellite Radio (CSR), own and operate a network of approximately 900 terrestrial repeater stations, meant to compensate for satellite signal blockage by buildings, tunnels, and bridges. In the United States XM owns and operates approximately 800 repeater sites covering 60 markets; in Canada CSR is installing approximately 80 to 100 repeaters that will be owned and operated by CSR in the 16 largest Canadian cities. The actual number of repeater sites varies as the signal is regularly tested and monitored for optimal performance. The actual number of sites in the United States has dropped from the original 1,000 installed when the service first launched in 2001. The repeaters transmit in the same frequency band as the satellites. A typical city contains 20 or more terrestrial stations. Typically the receiver owner is unaware when a terrestrial station is being used, unless he or she checks antenna information from the receiver being used.

The XM signal uses 12.5 MHz of the S band: 2332.5 to 2345.0 MHz. XM has agreed to provide 128 kilobits per second of its bandwidth to OnStar Corporation for use with XM-enabled GM vehicles, regardless of whether their owners are XM subscribers. American Honda also retains the right to some of the company's bandwidth to transmit coded traffic information directly to navigation systems using TMC technology.

Audio channels on XM are digitally compressed using the aacPlus codec from Coding Technologies for most channels, and the AMBE codec from Digital Voice Systems for some voice channels. Due to bandwidth restrictions and a large channel load, the maximum bitrate XM broadcast from its satellite per music channel is limited to 64kbps.

XM channels XM Pops and Fine Tuning are broadcast in 5.1 surround sound audio quality. The technology, titled XM HD Surround, is a partnership between XM and Neural Audio Corporation which provides content with six discrete channels of digital full fidelity audio powered by Neural Audio technology. XM Live also broadcasts in this format for select concerts and studio performances. XM manufacturing partners such as Denon, Onkyo, Pioneer Electronics (USA) Inc., and Yamaha have introduced home audio systems capable of playing XM HD Surround powered by Neural Audio.

Controlling interest

The company's May 2004 proxy statement notes that four directors are subject to director designation agreements with GM, American Honda, the chairman, and the CEO. Four additional directors are investors, and two are not affiliated with any significant stockholders.

At that time, GM owned 8.6% of the Class A common stock (a voting percentage of less than 1%) and Honda owned 13% (with a voting percentage of 3.6%).

Unless they unaminously agree otherwise, control of the company remains with the preferred shareholder and noteholders of the company, including Hughes Electronics, GM, Honda, and several private investment groups.

Clear Channel programming agreement

As part of terrestrial radio giant Clear Channel Communications' early investment into XM in 1998, the companies entered into agreements which provided for certain programming and director designation arrangements as long as Clear Channel retained the full amount of its original investment in XM. In June 2003, Clear Channel entered into a forward sales agreement relating to its ownership of XM. During the third quarter of 2005, Clear Channel and XM arbitrated the impact of this agreement on the Operational Assistance Agreement and the Director Designation Agreement. The Arbitration Panel decided that the Operational Assistance Agreement would remain in effect, including Clear Channel's right to receive a revenue share of commercial advertising on programming it provides to XM, but declined to enforce the Director Designation Agreement. Per the original agreement, Clear Channel has the right to program 409.6 kbps of XM bandwidth, including forcing XM to include commercial advertising. The current plans for this bandwidth will include up to 5 music channels including: XM11 Nashville!, XM21 KISS, XM22 Mix, XM24 Sunny, and the relaunch of WSIX on XM161 - the existing talk channel programming (XM165 Ask!, XM166 America Right, XM152 Extreme XM, XM142 Fox Sports Radio, XM173 WLW) and new regional based talk channels - all of which will begin airing commercials. The music channel advertising is expected to be limited to the 5-6 minute per hour maximum that was in place prior to XM taking its music channels commercial-free in 2004.

Seen as a blow to XM's 100% commercial-free music channel status, XM Executive Vice President of Programming Eric Logan released a programming announcementto XM subscribers on the company's website that reiterated XM's commitment to commercial-free music while noting that XM still had the most commercial-free music and that more commercial-free music channels will be added in the near future to ensure that XM will still have more commercial-free music than competitor Sirius Satellite Radio. On April 17, 2006, XM launched 10 new music channels. Some of these include XM Liquid Metal, ch 42; XM Hit List, ch 30; and Flight 26, ch 26. Other channels are expected to be in the genres of country, pop/hits, R&B, and latin. In response, Sirius has displayed that they are the only satellite radio provider that is 100% commercial free with music. Both XM and Sirius air commercials currently on their news, talk, and sports channels.

The Clear Channel forward sales agreement with Bear, Stearns & Co. Inc is set to expire in 2008, at which time Clear Channel is expected to deliver to Bear Stearns over 8.3 million shares in XM — which is their original investment — however Clear Channel withholds the right to settle with cash. If Clear Channel settles with shares, then it would be expected at that time that Clear Channels' Operational Assistance Agreement with XM would terminate, along with any and all programming provided by Clear Channel.

XM in Canada

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In November 2004, Canadian Satellite Radio filed an application with the Canadian Radio-television and Telecommunications Commission to bring the XM service to Canada. Along with Sirius Canada and CHUM Subscription Radio Canada, CSR was one of three applications for national subscription radio services submitted to the CRTC.

On June 16, 2005, the CRTC approved all three applications. The decisions were appealed to the Canadian federal Cabinet by a number of broadcasting, labour, and arts and culture organizations, including the Friends of Canadian Broadcasting, CHUM Limited, and the National Campus and Community Radio Association. The groups objected to the satellite radio applicants' approach to and reduced levels of Canadian Content and French-language programming, along with the exclusion of Canadian non-commercial broadcasting. After a lengthy debate, Cabinet rejected the appeals on September 9, 2005.

XM's Canadian channels appeared on US receivers on November 17, 2005. On November 29, 2005, XM Canada officially launched.

See also

External links

Official XM Radio websites

Fan sites

In alphabetical order: