Interesting technology. I can see issues, primarily around cost (using wireless isn't inexpensive while radio waves are free).
Actally, I can't think of a single instance where I would want that technology enough to pay for it. If a station fades away currently, I just tune to another station. There are still plenty of them around.
Technology isn't going to save AM radio, if indeed it needs saving. Improved, innovative programming will. Stations that are local and really care about their community will. If current analog AM goes the way of the Dodo and turns into a modified form of streaming, or HD, or whatever, then it's no longer AM. That could be OK, but even then, you would need that improved, innovative programming to successfully compete for listener ears. Gone are the days where people will listen to any old crap just because it sounds good.