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XM Interrupts Shipments Of SkyFi2, Xpress

6/05/2006 02:00:00 AM Eastern

XM Satellite Radio said it has asked Delphi and Audiovox, suppliers of the SkyFi2 and Xpress XM receivers, to suspend shipments of these products so that an adjustment can be made to help bring them into compliance with Federal Communications Commission (FCC) transmitter emission limits.

XM said that no products will be recalled. Instead, a small ferrite clip can be added to an antenna wire that minimizes the FM signal transmission from the XM receiver to the FM radio, said a spokesman.

XM filed a Form 8-K with the Securities and Exchange Commission last week outlining these actions, which are in response to an investigation by the FCC. In late April, XM disclosed it was notified by the FCC that the Delphi XM SKYFi2 radio was not in compliance with transmitter emission limits.

XM said that Audiovox received a similar letter from the FCC regarding the Xpress and that Audiovox has suspended shipments of the Xpress at the present time.

XM said that the FCC has new testing rules which require that products be tested in a in the vehicle, where previously FCC testing procedures allowed field tests outside of the vehicle or in a lab.

The products affected include only the Delphi SkyFi2 and Audiovox Xpress at present, but XM is also investigating its other receivers and accessories to make sure they are in compliance with FCC regulations. XM said, however, that the Pioneer Inno and Samsung Helix and Nexus shipments remain uninterrupted.

Reportedly the cost of the ferrite clip adjustment is about 25 percent to 30 percent per unit. XM said the clips will be added as “a running change” in manufacturing.

XM also reported in April that it received a letter from the Federal Trade Commission stating that it is conducting an inquiry to determine if XM's marketing activities are in compliance with acts including the Telemarketing Sales Rule.

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