Today may well be a different story, but the band most at risk to the newer technology is FM, not AM. Because the new technology DOES DO what FM radio does, and does it better.
The programming on most AM radio stations (news, topical talk, sports talk and sports play-by-play) is the least susceptible to MP3 player predation. The greatest strength of the FM band, the quality of the sound, has allowed FM to corner the market on music programming. Music programming is also the programming most easily replaced by personal, portable, devices other than FM radios. I-Tunes and the like now allow everyone to be their own music PD, and with an any genre playlist with no losers, no range limitations, and no clutter of any type. And do it on the cheap. The devices that you used to have to carry on your shoulder to get heavy-duty sound now fit in your watch pocket.
When you see everyone on a subway platform with buds jammed in their ears and rocking to their tunes, it ain't a radio station that IPod or Zune or etc is tuned too.
If I were an FM music PD, I'd be looking over my shoulder while waiting for AM to die. Ironically, after all the premature obituaries, AM radio may well be the last man standing.