2012 Passat Radio - Sat not functional

I just purchased a 2012 Passat TDI SEL with the non-gps radio. I has a sat radio, but when I push the Sat button, I get a message saying the "Sat Radio not functional"

Has anyone seen this before, and if so, what did you do?

Also, where is the Sat radio module on this model? Is it built into the radio, or separate from the radio, and if so, where is it?

Thanks

Jim