Digital Radio — The Sound of the Future
First there was digital television, called "the latest breakthrough in television." Now, digital radio is catching on as a popular form of broadcasting. The Federal Communications Commission (FCC) has moved a step closer to bringing digital radio to millions of Americans.
What is Digital Radio
Digital radio is the transmission and reception of sound that has been processed using technology comparable to that used in compact disc (CD) players. In short, a digital radio transmitter processes sounds into patterns of numbers, or "digits" – hence the term "digital radio." In contrast, traditional analog radios process sounds into patterns of electrical signals that resemble sound waves. FM digital radio can provide clear sound comparable in quality to CDs. Digital receivers provide significantly clearer sound than conventional analog radios, just as CDs sound clearer than record albums. AM digital radio can provide sound quality equivalent to that of standard analog FM, and sounds dramatically better than analog AM. Some broadcasters believe that digital broadcasting may bring music back to the AM band. Digital radio reception is more resistant to interference and eliminates many imperfections of analog radio transmission and reception. There may be some interference to digital radio signals, however, in areas that are distant from a station’s transmitter. 
Digital Radio Technology
In 2002, the FCC selected in-band, on-channel (IBOC) technology as the technology AM and FM broadcasters use for digital radio broadcasting. Broadcasters have begun IBOC transmission on an interim basis while formal transmission standards are developed. Transition to digital radio requires broadcasters to install new equipment. During the transition, broadcasters operate in a “hybrid” mode, broadcasting the same programming using both analog and digital signals within a single AM or FM channel. Many FM broadcasters now offer...
References: : http://www.fcc.gov/cgb/consumerfacts/digitalradio.html
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