I still BADLY miss a FM radio. 2 reasons, I get 3G signal dropout on the train to work so can't listen smoothly, and secondly the football commentary on my local stations only have the license to broadcast over FM/AM so it's just junk on radio apps. 
So yes people do still use FM radio and a radio app isn't a good enough replacement
So yes people do still use FM radio and a radio app isn't a good enough replacement