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Consumers to Tune Into Digital Radio in 2007

Here in the U.S. market, reports of financial analyst concerns about the viability of the XM and Sirius digital satellite radio services continued to surface during 2006. Sirius and XM shares have taken a battering on Wall Street, with prices for both off about 50 percent from their year-ago levels. Regardless, there is renewed hope that 2007 could be the year that these services are embraced by more mainstream consumers.

The conversion from analog radio to digital radio is well under way around the world and gaining momentum rapidly, reports In-Stat. Worldwide, the market for digital radio receivers will grow from 5 million units in 2005, to almost 25 million unit shipments in 2010.

"The primary factors contributing to this expected growth are falling receiver prices, an increase in the amount of compelling digital programming, significant boosts in promotion and advertising of digital radio, and enhanced functionality of digital radio receivers," says Stephanie Ethier, In-Stat analyst. "Overall, digital radio is still an emerging market. Opportunities abound for retailers, broadcasters, automobile OEMs, and receiver manufacturers alike."

In-Stat research found the following:

- XM will hit 8 million subscribers, and Sirius will hit 6.3 million subscribers, by the end of 2006.

- In 2006, 73 percent of respondents to an In-Stat U.S. consumer survey were 'aware' of HD Radio on some level.

- In Europe, primarily the United Kingdom, digital audio broadcasting is the pervasive form of radio, with DAB radio receiver shipments outpacing analog radio receiver shipments this year.

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