In a moderately weak signal environment, FM (and its cousin, PM) often have an advantage over AM. The FM receiver can also be designed for immunity from electromagnetic pulse events, as is caused by lightning and the starting of large motors. Normally there is no rule preference that favors either type of modulation so FM becomes the modulation of choice.
The range advantage for modulation is derived from the choice of IF filter bandwidth. Reducing the filter bandwidth is equivalent to increasing transmit power. Then, single sideband (SSB) AM offers an improvement over conventional double sideband+carrier AM; Gaussian minimum shift keying FM offers an advantage over conventional FM because both forms of modulation can be used with a more narrow band IF filter.
In the same manner, a lower data through-put speed can increase system range. Data through-put is directly related to the occupied bandwidth, which must be matched, or exceeded, by the receiver IF filter. A lower speed occupies less bandwidth allowing the use of a narrow IF filter.
An AM advantage
In the US there is a power advantage for very low duty cycle, sporadic operation, AM, in the 225 to 470 MHZ band. For some specific types of operation a transmit power of almost one milliWatt is allowed. This compares favorably against non-spread-spectrum operation in the 902 MHZ ISM band. The same power level is allowed in both cases. This provides a range advantage to the lower frequency band. The lower frequency band also enjoys less loss through buildings and foliage, a bit less multipath interference, and a lower parts cost.
There is a common misunderstanding regarding spread-spectrum processing gain. When a signal is spread over a wide band, it undergoes the same range reduction as a conventional signal. This range is recovered in the receiver processor when the signal is "despread" with the correct spread-spectrum code. This recovery process provides a "processing gain." Processing gain is only a gain compared to the range of the wideband, spread, signal. It is not a gain compared to the range of a conventional signal.
The range of a conventional system is identical to the range of a locked, spread-spectrum, system if the power level and antenna gains of the receiver and transmitter of both systems is the same. Prior to spread-spectrum lock-up, the conventional system has a clear range advantage.
In the US and Canada, the rules for spread-spectrum transmissions in the microwave ISM bands allow 30 dB more transmitter power and a transmit antenna gain over conventional, non-spread-spectrum systems. This is the spread-spectrum advantage.
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