I did not ask before, but does any other audio source work (like tape or CD)?

Since it did not work when you bought the car, I am betting that it is something more difficult. My reasoning is that the previous owner would have fixed the problem to enhance value. But, let's cover the basics...

First, make sure that the radio is set to the correct region.

* Turn on your car
* If the radio is on, turn it off
* Turn the radio on
* Immediatly push and hold the SELECT button until the radio serial number shows (5 to 10 seconds)
* Use the < > keys to cycle through the menu until you see the AREA mode. The radio may be set to "NOAREA."
* Use the 1 or 2 buttons to switch to different areas-- set it to the one most applicable for you.
* Turn the radio off to save the settings.
* Turn the radio back on and use it as normal.

Next, check your antenna connections on the radio. Based on the year of your car, your radio should have two coax antenna wires connected. (It will only have one, if the previous owner upgraded the radio to a "New Gen" radio.)

If your radio's AREA is correct and the antenna wires are connected, then you are on to the harder problems.

1) Your radio could have a bad AM/FM tuner section.
2) The Diversity Antenna Amplifiers mounted in the C-Pillars are bad or disconnected.
3) The antenna wires in the rear window have major breaks or faults. (Does your rear window defogger work?)

__________________
SOLD
2000 E38 750iL Highline Edition, Upgraded with the lastest 2006 X5 Electronics
MKIV Navigation, 16:9 Display, Bluetooth, TV/Video with Backup Camera, Sirius, and Aux Input