Comment by robdachshund

Spotify has compressed audio at pretty low bitrate. The FM signal has a full 20hz to 20khz frequency response and they are probably playing CD quality audio. Since it's just raw analog audio represented by radio frequency, it sounds better than the compressed stuff on spotify.

If you have a good signal, FM can be very high fidelity. Ever since people ditched CDs we've been listening to low quality streams and rips.