SirRoxalot said:
Part of the reason FM grew as it did is because the FCC mandated limits to simulcasting of AM stations. That meant that FM owners had to originate programming during the majority of the day. It was often cheaper to hand the station over to a bunch of starry-eyed kids than plant canned content on the stations. Those kids created programming that related to an audience that was turned off by the high-power AM presentation - and offered better music fidelity.
Car manufacturers made AM/FM receivers standard. The rest, as they say, is history.
The FCC simulcast ruling affected larger markets only and went into effect in 1967. It took 10 years for FM to achieve parity based on the roughly 200 rated markets at the time. Of course, some markets moved faster, as they had few if any decent AMs... DC is one (zero full market AMs) and Phoenix, Atlanta and Cleveland are others.
In most markets, there were not enough good AM signals to offer day and night a decent selection of formats. As people discovered that FMs had some of the "missing" sounds, folks migrated. The worse the local AM signals, the easier it was to get the audience to move. In well radioed markets like New York, it was slower... in the bad-signal places, it was much quicker.
In the vast majority of cases, the end of simulcasting just brought in cheap tape formats. Few stations spent the money to develop something... after all, FM had been losing money for nearly 30 years. As the few innovators and promoters proved FM worked with something other than classical and beautiful music, the band achieved critical mass and became dominant. But there were very few "starry eyed kids" (who were mostly blury eyed stoners) and they were nowhere near uniformly successful. When the FMs playing contemporary (CHR and Rock) learned that FM listners wanted the hits, not deep, deep album cuts, those freeform stations died painful deaths.
Standard availability of AM/FM in cars did not happen, as already noted, until the early 80's. I remeber having to specify an AM/FM option in 1978 or I would have gotten an AM only radio.