How it started
1988–2000
The American Mobile Satellite Corporation was founded in 1988 where Bob Kerstein was the Chief Financial Officer. In 1991, Lon Levin joined the company. In 1992, the American Mobile Satellite Corporation created a new division known as American Mobile Radio Corp. Later that year, American Mobile brought in WorldSpace as an investor.
On May 16, 1997, American Mobile Satellite and WorldSpace officially changed the name of American Mobile Radio to XM Satellite Radio. Later that month, Lon Levin became president, a position he would hold until 1998. In October 1997, XM Satellite Radio obtained one of only two satellite digital audio radio service licenses offered by the Federal Communications Commission. In 1998, Hugh Panero President and CEO, joined XM Satellite Radio in the same role.
In June 1999, Clear Channel Communications, DirecTV, General Motors, and a private investment group invested US$250 million in XM Satellite Radio convertible debt. On June 7, with GM's investment in XM, they entered into a 12-year "Distribution Agreement" between XM and GM subsidiary, OnStar Corporation. The agreement called for exclusive installation of XM Satellite Radio into GM vehicles from November 12, 2001, until November 2013. OnStar had to meet specific escalating installation rates each year, while XM needed to make extensive payments to OnStar for the installation and sale of XM in their vehicles, while sharing revenue earned from these radios with OnStar, as well as payments on the exclusivity agreement.
At the same time as the investment, American Mobile Satellite, still XM's parent company, reacquired the stake WorldSpace held in the company. In October 1999, XM Satellite Radio issued 10,241,000 shares of Class A common stock at an IPO price of US$12.00 per share. American Mobile Satellite remained the majority holder of the public company.
In April 2000, American Mobile Satellite Corp. changed its name to Motient. In July, American Honda joined several private investors in a US$235 million preferred stock investment in the company.
From Wikipedia’s article on XM Satellite Radio, shared under CC BY-SA 4.0.2