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Why is frequency modulation (FM) not used on the current amplitude modulation (AM) radio stations? The Police have FM 2 way radios that use only 5 kilocycles of modulation. Instead of the current AM radio stations that use the same bandwidth of 5 kilocycles. The limiter & discriminator or ratio detector filter out the static & loud pops that are on AM; Thus the FM would have much less static & noise than AM. FM channels would occupy the same bandwidth as AM channels. For example if WABC in New York used frequency modulation over the current frequency of 770 they would need to have the oscillator changed but the power amp would stay the same. But the receiving radios would need to be replaced with a radio to demodulate frequency modulation at 770.

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How far does an FM signal (approx. $100$ MHz) propagate compared to an AM signal (approx. $1$ MHz)? What is the minimum spacing of FM signals with reasonable audio fidelity and how does this compare with your chosen FM frequency of $770$ kHz? – Dilip Sarwate Aug 11 '14 at 9:43
Don't forget FM's capture effect, either. – Michael Kjörling Aug 11 '14 at 11:13
  1. Because (as you note) all the receivers would have to be replaced.
  2. Because international agreements allot that part of the spectrum to AM.
  3. Because an FM transmitter with 5kHz modulation needs 25kHz channel spacing to avoid problems with adjacent channels.
  4. Because an FM transmitter with 5kHz modulation only has an audio bandwidth of 3kHz - which is far less than AM (depending on the standard used 5khz, 10kHz or 15kHz.)
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I'll list a couple of main reasons:

First reason is compatibility! You'd have to leave behind a few generations worth of AM receivers, all of which would suddenly be unuseable. Then there's also equipment at existing stations that needs to be changed, which requires more investments. Furthermore, will listen to your FM radio station in the AM band? There's also regulatory angle that needs to be taken into account.

Second, even the analog FM itself is outdated. Today, we're moving towards the digital systems and in the short-wave region, the main systems are Digital Radio Mondiale and HD Radio. Both can provide in certain configurations performance as good as broadcast FM and can be used in configurations which are compatible with already existing AM equipment. There are similar solutions for VHF radio as well, which are intended to replace the broadcast FM stations.

Next, there's the claim of Police two-way FM radios which use 5 kHz bandwidth. I'd really like a source for that claim! Most FM professional radios do use today 2,5 kHz or 5 kHz of FM deviation, but deviation is not FM bandwidth. A popular method of determining FM bandwidth is the Carson's rule, which states that the majority of sideband energy is within bandwidth of $B=2( \Delta f +f_m)$, where $\Delta f$ is the peak deviation and the $f_m$ is the maximum frequency transferred. Common channel spacings for two-way radios are 12,5 kHz and 25 kHz. They both provide good enough quality to understand words, but are insufficient to transfer music. When using 5 kHz deviation, traditionally, highest frequency transferred is 3 kHz, which gives us 16 kHz occupied bandwidth plus a bit of extra space for co-channel interference. In the 12,5 kHz case, 2,5 kHz deviation is used and the highest transferable frequency is also around 2,5 kHz, which gives us 10 kHz of bandwidth and a bit extra for co-channel interference.

So "narrow" FM does give us comparable bandwidth to AM, but maximum useable frequency is much lower. I don't have a good reference for AM broadcasting at the moment, but if I remember correctly, the maximum frequency that can be transferred in medium-wave AM is a bit less than 5 kHz. That's twice as good as narrow FM and still has a bit lower bandwidth.

I forgot the power-amp part that was mentioned in the question.... There is a difference between power amplifiers for AM and FM broadcasting. AM output power is (lot's of hand-waving here!) proportional to input power of the signal, so louder input will provide louder output. On the other hand FM has (again lot's of hand-waving here) power output that's closer to constant and doesn't depend as much in the input signal. This is important, because for same peak output power, FM transmitter's average output will me much closer to peak than for AM transmitter. This requires that FM transmitters be much more conservatively rated.

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AM, by virtue of being amplitude modulated, outputs less power with less modulation. However, since half of the maximum peak power is in the constantly on carrier (the remainder divided between the sidebands), the difference isn't as large as one might think. (Output power with no modulation at all is 50% of with full modulation.) FM on the other hand can be amplified using a non-linear amplifier (AM requires a linear amplifier) which can be made more efficient. So while existing equipment is very likely a strong consideration, on the transmitter side in particular you have both pros and cons. – Michael Kjörling Aug 11 '14 at 11:10
@MichaelKjörling - Your power argument doesn't hold for single-sideband AM. And AM does not require a linear amplifier, so long as post-filtering is supplied to remove unwanted sidebands. – Daniel R Hicks Aug 11 '14 at 20:07
@DanielRHicks You point out some worthwhile things, but high-power filtering isn't all that trivial (not necessarily a dealbreaker), and double sideband AM (double sideband full carrier) vs single sideband AM (single sideband full carrier) still doesn't change the fact that a lot of your power is going into the (not changing) carrier, with the remaining power in the modulation sideband(s). – Michael Kjörling Aug 12 '14 at 7:41
Even so, I think it's safe to say that regulations, necessary channel spacing with FM and existing equipment form a very large part of the answer to why AM is still used in the MF/HF region. – Michael Kjörling Aug 12 '14 at 7:42
@DanielRHicks Indeed, that follows from single sideband / fully suppressed carrier. With "AM", whether you mean single or double sideband (traditionally AM is double sideband) you still have the carrier present; single/double sideband / full (or possibly reduced, but not fully suppressed) carrier. So the numbers in my comment may be slightly off, but the principle still stands: with SSB/DSB AM, less modulation means less power output, but even with zero modulation you still have some power output. That "some" is, at least traditionally, quite considerable in the grand scheme of things. – Michael Kjörling Aug 12 '14 at 11:40

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