BusinessWeek Comments On FCC FM Modulator Issue

AUGUST 14, 2006, Technology
By Catherine Holahan, www.businessweek.com

XM Tunes into FCC Trouble
The satellite radio company's stock gets hit after some of its plug-and-play radios fail to pass muster again

Investors have not liked the noise surrounding XM Satellite Radio. On Aug. 11, XM (XMSR ) shares declined 3%, to $10.84, after the company revealed that the Federal Communications Commission had requested additional information about its plug-and-play radios. The company has suspended production and shipment of eight radios, including the Sportscaster and MyFi series, until it can bring the devices into compliance. News of problems with the radios first surfaced in April, when the company disclosed the FCC had compliance issues with some portable devices that convert satellite broadcasts into FM signals for play on standard car radios. The signal on some devices was too strong and had the potential to corrupt FM signals received by other drivers. XM tried to correct the problem, but when the FCC reviewed the radios, they didn't pass all the tests. "We are working to complete these design modifications," says XM spokesman Chance Patterson. "We anticipate that we will obtain new certifications for XM radio in the coming weeks." ...read more: HERE

8/14/2006 03:16:00 PM

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