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There are several Apps that work on XM, some better than others, none are great. I use Radio.net
The main reason that Mobil phone makers do not have, or do not activate FM is that FM antennas generally need to be much longer than the size of phones. Many years ago some manufacturers tried using the earphone cable as the FM antenna with limited success.
@DaveO3 wrote: ... FM antennas generally need to be much longer than the size of phones. Many years ago some manufacturers tried using the earphone cable as the FM antenna with limited success.
That might be a reason for manufacturers to omit FM receivers from a device. But it doesn't begin to explain why a carrier would disable the FM receiver in devices which have them.