FCC Officially Ends Inquiry Into PPM

The commission grants a request from the PPM Coalition
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The commission grants a request from the PPM Coalition

The FCC has officially ended its inquiry into the Arbitron Portable People Meter, bringing to a close a contentious chapter in the rollout of the new audience measurement system.

The industry has been divided sharply over whether PPM accurately measured listening and if the FCC even had the authority to look into the matter. But the PPM Coalition, which had been critical of the methodology, asked the agency in April of last year to let it withdraw its emergency petition for an inquiry. The FCC has now done so and ended the proceeding with no further action and no decision on the merits of the issue.

The coalition consists of the National Association of Black Owned Broadcasters, Spanish Radio Association, Minority Media and Telecommunications Council, American Hispanic Advertising Association, Border Media Partners, Entravision Communications Corp., ICBC Broadcast Holdings, Spanish Broadcasting System and Univision Communications.

They had asked the FCC to look into their meter concerns in late 2008. At issue was whether the PPM under-counted minorities. Some radio groups with urban and Hispanic-formatted stations said minorities were under-represented in the sample panels of those who wear the device. They also said PPM devices were not sufficiently distributed to minority listeners, which hurt ratings.

The groups said at the time that as a direct result of PPM use, minority stations lost ad sales and revenues. Stations that disagreed said the PPM was more accurate than the diary method and reflected true listening, rather than the nostalgic or loyal writings of diary-keepers.

The Media Bureau then opened the issue for public comment and began a Notice of Inquiry to investigate the impact of PPM methodology on the broadcast industry, as well as whether audience ratings data are accurate enough for the commission itself to use. The commission relies on Arbitron-defined radio Metro markets to determine compliance with the local radio ownership rule, the tiered system that limits owners to controlling up to eight stations in the largest markets.

The commission also asked for comment on whether and how PPM hurt program diversity. Earlier in 2008, an FCC advisory committee asked it to look into PPM to determine whether the system was having a detrimental and discriminatory effect on stations targeting minority audiences. The FCC’s inquiry coincided with a congressional oversight hearing. Arbitron’s president and chief executive officer, Michael Skarzynski, resigned in January 2010, and board member Bill Kerr stepped into that role.

Arbitron said PPM methodology was sound, especially when compared to the diary system, but the company agreed to work with the groups about their concerns.

Comments to the agency were divided regarding the soundness of the PPM methodology and whether the FCC had the authority to request information concerning PPM technology.

In June 2009, an FCC subcommittee formed a task force to focus on issues with Arbitron’s PPM methodology. In December of that year, it recommended that the commission investigate whether certain radio industry ratings practices, such as PPM use, have a negative effect on certain formats and whether there is any impact on diversity of radio ownership.

When it filed its request to withdraw the petition last April, the coalition said that under the leadership of the House Oversight and Government Reform Committee, it worked with Arbitron and the Media Rating Council to implement steps to enhance PPM recruitment methodology, including adding address-based sampling with targeted in-person recruiting to increase PPM panelist participation in key market segments.

Based on study and negotiations to improve the PPM methodology, on April 21, 2010, the coalition and Arbitron “agreed on a plan that presents a framework to address the coalition’s concerns,” the groups told the FCC.

— Leslie Stimson