Mark Kalman, vice president of Sirius' national broadcast studio, said statistical multiplexing uses a variable bitrate encoder, unlike AAC or MP3, for example, which employ fixed bitrates.

Statistical multiplexing, he said, is efficient and doesn't waste bits; it takes only those it needs to encode the audio at that instant. Statistical multiplexing puts the unused bits in a common bit pool for the other channels, giving Sirius the ability to change the bitrate for each channel constantly, and devote more to some and less to others.

"These algorithms are so advanced and so efficient that what people know in the marketplace, like Windows Media, Real Audio and MP3, are not in the same league as these coders," said Kalman.