Arbitron, Minority Broadcasters Break Long-Running Impasse

The provider of radio ratings and representatives of more than 400 stations settled a years’ long dispute over the sampling methodology of portable devices whose implementation led to declines in some broadcasters’ audience share estimates. Thursday’s settlement between the PPM Coalition and Arbitron, provider of Portable People Meters, came after the FCC encouraged both sides to settle, as did a judge overseeing a related case, participants said. Another turning point was said to be the installation of William Kerr as Arbitron CEO in January after Michael Skarzynski resigned suddenly because he mischaracterized testimony on PPMs before the House Oversight Committee (CD Jan 13 p3).

The most significant point of the deal was the company’s agreement to begin seeking PPM participants in person, said Senior Vice President Andrew Schwartzman of the Media Access Project, among those supporting the coalition’s request in September 2008 for an FCC investigation. “The in-person recruitment will probably skew up the level of participation and using the meters because you can see who the people are, whether they're genuinely interested,” said President Paul Rotella of the New Jersey Broadcasters Association. “By in-person recruiting as opposed to just canvassing though the phonebooks I think you'll again get cellphone-only households."

People lacking landline phones but using wireless service are disproportionately young and minorities, audiences who were under-sampled using Arbitron’s old methods, according to Schwartzman and other critics. “There was a crisis of confidence in the information we were receiving, and that’s important for us as broadcasters because ratings is the information we live or die with,” said Chief Revenue Officer Frank Flores of Spanish Broadcasting System, a member of the coalition that was in litigation with Arbitron. “It’s not about us getting better ratings, it’s about us getting better information.”

It’s hard to say what impact the new methods will have on ratings, said Flores and lawyer Antoinette Bush of Skadden Arps, representing the coalition. “There’s no guarantee the ratings are going to rise as a result,” she said. The goal was “to improve the sample so the sample is more representative.” The settlement is “good not only for minority broadcasters but really for all broadcasters,” said Executive Director David Honig of the Minority Media and Telecommunications Council, a coalition member. “It commits the company to what will ultimately prove to be a much more accurate system of sampling and measurement, and that has to be beneficial to everybody.” Other coalition members include the ICBC Broadcast, National Association of Black Owned Broadcasters and Univision. Their representatives declined to comment or didn’t reply to messages.

The FCC encouraged the sides to settle, thinking a private solution was better, several participants said. It sought comment in 2008 on the coalition’s request for an investigation but never began one. “It was clear to all the parties that the FCC felt that this issue would be better resolved privately amongst the parties than through an FCC proceeding,” Bush said. “So I think there was encouragement by the FCC for the parties to work together.” A judge at New York State Supreme Court, where Arbitron v. Spanish Broadcasting was filed, also encouraged mediation, which the two companies did enter, Flores said. “I'm really thankful the cooler heads did prevail,” he said. “Bill Kerr’s involvement was a tipping point. There was kind of a breath of fresh air when he took over” since “he looked at the issue differently than his processors did,” Flores continued.

"This is a good starting point for us to continue on the road for this service to get better,” Flores said. As previously disclosed, Arbitron will increase by 10 percent the number of people aged 18-54 it includes in PPM surveys by the middle of next year, the company said Thursday. The Media Rating Council, an accreditation body for PPMs, will oversee the implementation of the settlement as the company seeks its approval, participants said. “These initiatives, together with other elements, are part of a larger ongoing program by Arbitron to obtain and retain MRC accreditation,” Kerr said in a news release. A company spokeswoman declined to comment on implementation.

"Undercounting minorities has plagued urban radio stations since Arbitron began using the PPM in 2007, threatening to dismantle diversity on the airwaves and the financial viability of minority targeted radio stations,” Oversight Committee Chairman Ed Towns, D-N.Y., said in a written statement. With the agreement, “minority listeners will be counted and minority owned radio stations will work more closely with Arbitron.” Towns’s “work on this issue has been extensive,” said an aide, declining to specify his involvement.

The settlement seems to be a “major step forward,” FCC Commissioner Michael Copps said. “How successful it will be will depend, of course, on implementation of the terms of agreement.” Commissioner Mignon Clyburn has “some general structural concerns about the voluntary nature of the MRC’s process,” she said. “I am nonetheless heartened that the parties have negotiated a solution without formal governmental action.” A Media Bureau spokeswoman deeclined to comment. The New Jersey broadcasters’ Rotella is optimistic a deal can be reached between that association’s members and Arbitron, he said. “I'm impressed with the attention that they're paying to these issues. It’s not just lip service -- it’s really trying to resolve these issues in good faith with us.”