They've been gaining subscribers at a pretty good rate, but they certainly haven't found a way to turn a profit yet.
The proposed merger between XM and Sirius could definitely help both, but I don't know that they're going to be able to actually
make money, even then.
Personally, I'd be really disappointed if Sirius failed. I've had the service for a year, and I never listen to terrestrial radio any more. On the off chance that I hear it, I can't believe I ever listened to it.
Concerning the FM modulator, I think it works just fine. On long trips, yes, we have to adjust the frequency every so often, but it's very, very easy to do on my Sirius radio.