Satellite Radio Is Hot

Surprisingly, one of the more dominant technologies at the 2005 International Consumer Electronic Show (CES) was satellite radio. First launched several years ago at CES, satellite radio showed all the signs of a short-lifespan product: It was competing against something that was free, it required a new hardware installation in cars, and it was buggy. But like cable TV, satellite radio eventually proved that it's sometimes better to pay a fee for better service. The two major players, XM and Sirius, now have a combined subscription base of more than 4 million listeners, and their success appears due to smart partnerships. The companies both have deals with automobile manufacturers to make their players a factory option on new cars. Both services offer exclusive content, which is a big draw, with XM signing a multiyear deal with Major League Baseball and Sirius snagging famous shock-jock Howard Stern for a show that will start in 2006. CES 2005 featured new types of satellite-radio players, including a portable Sony Walkman-like player from XM. The success of satellite radio has traditional radio stations running scared. At CES, the country's major radio stations announced that by the end of 2006 almost all of them will offer higher-quality and feature-packed HD radio content in a bid to stave off satellite radio adoption

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