While the satellite-radio services were broadening their subscriber bases, terrestrial AM and FM stations were installing equipment to launch commercial digital service.

In late 2002, the Federal Communications Commission (FCC) gave AM and FM stations interim authority to transmit digital programs using the IBOC digital radio system developed by iBiquity Digital. It's an In-Band On-Channel (IBOC) system that lets existing AM and FM stations use their existing transmitters, antennas and dial positions to deliver high-quality interference-free digital audio – and without the monthly subscription costs required by satellite-radio broadcasters. 

Radio Station Roll­outs:

Major broadcast groups have committed to aggressive rollouts, having overcome skepticism that digital broadcasting might turn out to be another AM stereo or other broadcast-radio technology that failed in the marketplace.

In mid-2004, three of the top 10 radio groups by station count, Clear Channel, Cox and Entercomm, announced aggressive roll-out plans. In early 2005, they were joined by 18 other station groups. All told, the committed groups account for nine of the top 10 groups, 17 of the top 20 groups, and 21 of the top 27 groups.

Combined with plans by public radio stations, the commitments will increase the number of digital stations to 2,500 during the next several years. Among the 21 groups committed to rollouts, the “vast majority” will make their planned conversions over a three- to four-year period, iBiquity says. The 21 will convert anywhere from 50 percent to 100 percent of their stations.

The 2,500 stations represent only about 19 percent of the 13,500 radio stations in the U.S., but these numbers don’t tell the whole story. During the early years, the number of digital stations in major markets will be more important to IBOC digital radio’s success than the number of digital stations nationwide, and most of the committed stations are strategically located in the top 100 population centers. Commitments by the top radio groups also will spur other stations to convert to stay competitive.

Within each market, not every station needs to broadcast digitally for IBOC digital radio to be successful, proponents add. Research company In-Stat/MDR notes that most consumers listen to between two and six radio stations regularly. If several of their regular stations offer digital broadcasting, consumers would be willing to buy new IBOC digital radios, the company says.

By the end of 2004, 176 stations were on the air reaching 40 to 50 percent of the population, iBiquity said. The company forecast that by the end of 2005, 500 to 600 stations will be broadcasting to 70 to 75 percent of the population. 

CD­Like FM Sound:

What consumers get out of their IBOC digital radios will be digital FM that sounds “statistically indistinguishable” from CDs and digital AM stations that will sound as good as or better than today’s analog FM stations, iBiquity said.

Digital broadcasting will minimize adjacent-channel interference and virtually eliminate multipath, noise and interference that reveals itself as static, hiss, popping sounds and fading. Like their satellite counterparts, terrestrial digital stations will deliver program information such as song titles and other data.

Hybrid Broadcasts:
IBOC digital radio makes it possible for digital stations to simultaneously serve analog-radio users. IBOC technology lets broadcasters deliver simultaneous analog and digital versions of the same program on their assigned frequencies.

The dual analog-digital approach serves another purpose: a station’s analog signal will back up a dropped digital signal to ensure uninterrupted listening. The dual approach is needed because, with digital broadcasting, there’s no such thing as receiving a degraded signal. You get a pristine signal or no signal at all. That’s called the “cliff effect.” To prevent cliff-effect digital dropouts, a digital radio gradually switches over to analog reception during digital-dropout periods. Digital dropouts aren’t expected to happen often, however, because digital stations broadcast a second digital signal as a backup.

When digital signals are received, listeners will not hear the familiar static, hiss, pops and fades associated with analog radio. The noises will return, however, in areas where the digital signal gives way to its analog counterpart. 

Broad Support:

Because of advantages like these, iBiquity’s technology has won broad industry support. Its owners include major radio station groups as well as automaker Ford. Its technology has been endorsed by the National Radio Systems Committee (NRSC), which is jointly sponsored by CEA and the NAB.

The NRSC based its endorsement on the results of field, lab and listening tests conducted by independent test labs and monitored by NRSC representatives. From the tests, the NRSC concluded that the digital FM technology delivers “greatly reduced impact of multipath interference (for mobile, portable and fixed receivers alike), superior resistance to co-channel and adjacent-channel interference, support for enhanced data services, [and] improved audio quality.”

The advantages overcame many top broadcasters’ concerns over the cost of installation. The cost of converting higher power major-market FM stations has run between $100,000 and more than $200,000. For broadcast groups operating tens or hundreds of stations, the conversion costs add up quickly, and many of these groups simultaneously must manage high debt loads resulting from expansion through station acquisitions, industry executives noted.

Nonetheless, radio stations “realize they can’t be analog in a digital world,” said a NAB spokesman.

Consumer Interest:

The results of a CEA consumer survey also should raise radio stations’ interest. The 2004 New Technology Radio Survey found that 48 percent of adults were “very interested” (13 percent) or “somewhat interested” (35 percent) in buying an IBOC digital radio receiver for the car at some point in the future. In contrast, only 20 percent of consumers said they were “very likely” (4 percent) or “likely” (16 percent) to buy satellite radio sometime in the future, in large part due to monthly subscription costs.

Although interest in IBOC digital radio was strong once the benefits were explained to them, consumers were largely unaware of the technology at the time of the survey. Fifty-eight percent of consumers were unaware of IBOC digital radio, and only 35 percent could correctly identify the proper explanation of the technology from a list of descriptions.

In contrast, 73 percent of the surveyed consumers said they were aware of satellite radio technology before taking the survey, underscoring broad promotional efforts by the service providers and electronics suppliers.

Car Talk:

Consumer electronics suppliers and automakers will help raise awareness in 2005 by offering more opportunities for consumer to hear IBOC digital radio, mainly in the car at first and at prices that have become more affordable.

In the car audio aftermarket, at least seven companies planned to offer car products, up from three in 2004. Four of those companies each planned to offer a single CD-receiver with built-in IBOC digital radio, while the other three planned “black-box” tuners that mount under a seat or behind the dash and are controlled by many of their latest in-dash CD-receivers.

The black-box tuners were expected to retail for around $300. The IBOC digital radio-equipped CD-receivers were expected to start at a suggested $499, down from the previous year’s $999.

Sometime in 2005, at least one automaker will offer IBOC digital radio. 

Home Front:
On the home front, at least two suppliers, and possibly four, were expected to offer home IBOC digital radio products in 2005. One product would be a one-piece high-quality tabletop radio, and another would be an optional slide-in module for a four-zone component tuner whose price starts at $2,800. It’s designed to distribute up to four radio programs (including XM Satellite programs) simultaneously to different rooms of a house through custom-installed in-wall and in-ceiling speakers.

Future Services:
Although sound quality and song-title display are among the benefits of these devices, IBOC digital radio offers additional potential benefits. Radio stations, for example, could deliver fee-based information services, and radios could offer an audio program management (APM) feature, which time-shifts programs much like a digital video recorder (DVR) for TV sets.

Digital radio also makes it possible for an FM radio station to deliver multiple programs simultaneously on its assigned frequency. The separate-audio program feature is called Tomorrow Radio, and its main proponent is National Public Radio (NPR).

It works like this: Instead of broadcasting a single 96-kilobits-per-second (kbps) CD-quality signal, an FM station would broadcast a high-quality 64-kbps program and a supplementary 32-kbps program. The 32-kbps program is satisfactory for a mixed speech and music service, and it would still be interference-free.

Alternately, stations could broadcast two near-CD-quality 48-kbps streams. National Public Radio (NPR), for example, hopes in 2005 to begin transmitting four near-CD-quality program streams to member stations, allowing stations to choose the two that they will broadcast simultaneously to their listeners.

The FCC is authorizing digital FM stations to deliver more than one audio program at a time.

Surround Sound Radio:
Whatever their bandwidth, digital AM and FM stations could opt to broadcast some of their music programming in stereo-compatible surround sound.

Five separate surround sound technologies are competing for adoption by radio stations that want to convert to digital broadcasting. Although the surround solutions aren’t likely to all be compatible with one another, they will all be compatible with two-channel IBOC digital radio tuners, which will play the surround broadcasts in two-channel form.

iBiquity already has endorsed the installation of Circle Surround II Dolby Pro Logic and Neural Audio encoders at AM and FM stations. Two other surround sound technologies proposed for IBOC digital radio include an MPEG-based system promoted by radio transmission equipment maker Telos/Omnia, and another system from audio compression system developer Coding Technologies.

Should more than one solution come to market, iBiquity said it doesn’t expect a replay of the AM stereo debacle of the early to mid-1980s, when competing formats kept most AM radio stations from converting to stereo. In this case, surround sound would merely be a side benefit to a technology that could stand on its own, the company contends.