Subscriber radio service XM Satellite Radio Holdings has celebrated its millionth factory-installed vehicle radio system at General Motors headquarters, with one motor industry executive praising the system as “probably one of the best non-product things we’ve put out to date.”

According to Dow Jones Newswires, GM’s Chevrolet division president Brent Dewar said the system is helping engender a strong sense of loyalty among Chevrolet buyers, who make up 50% of the XM Satellite subscribers on the road.

“We know we’re on to something very good,” he reportedly said.

Dow Jones said XM Radio counts 1.5 million subscribers to its service, and projects to have 2.8 million by the end of the year and 20 million by the end of the decade. The service was launched nationally in 2001, company president Hugh Panero told the news agency.

Panero reportedly said 50% of its subscribers own XM Radio through their cars, while the rest have bought stand-alone systems. The digital radio service offers 120 specialised music and talk stations, and recently launched a regional weather and traffic service. Subscriptions cost $US9.99 a month, with discounts offered for customers who sign up for longer periods.

Dow Jones said GM has been offering the service with a free 90-day trial period in XM-equipped cars and Panero told the news agency that seven out of 10 drivers who go through the trial period end up purchasing subscriptions.

While free radio station broadcasters in the US are currently embroiled over debates on what’s appropriate for the airwaves, Panero reportedly said XM is relatively untouched by those arguments. Subscribers opt in to the service, and can block stations or not sign up for stations they object to – like the recently introduced Playboy station.

Subscriber radio is “a very different creature than an over-the-air product,” he told Dow Jones, adding that most of XM’s customers are attracted to XM’s music offerings.

“In an environment that’s really starved for quality,” XM Radio is one of few options to escape formulaic radio stations, he told Dow Jones, adding that other radio stations “are trying to cater to a very mass market. Our goals are very different.”