Arbitron vs. New York State

Thrown out!

According to the judge the states case raises "important state interests." In short, the AG's case alleges Arbitron is guilty of fraudulent and deceptive business practices and civil rights violations. [All Access posted the full text of the judges opinion here.]

In a release Arbitron SVP/Press & Investor Relations THOM MOCARSKY said, "Today's ruling does not impact ARBITRON's right to publish our PPM audience estimates in New York. We went to Federal Court seeking to protect our right to provide the radio industry with the up-to-date PPM audience estimates it needs. Following our efforts, the New York Attorney General chose not to seek a temporary restraining order adversely impacting our right to produce PPM estimates.

"Now that ARBITRON has commercialized the PPM service in NEW YORK and other key markets, we look forward to defending our interests. Broadcasters, agencies, and advertisers need continual PPM audience estimates if radio is to remain competitive in an increasingly complex and crowded media marketplace."

Fraud, deception, and civil rights violations? Let me be understated here. Really? What? Over the years Arbitron has gone out of its way to fairly (some might say more than fairly) appropriately represent minority listeners. What changed? Why now?

I'm the last person to give Arbitron a free pass. I'm not saying PPM is perfect. It seems to me that stating that the state has an important interest in radio ratings is troubling. Why?

It's fair game to challenge Arbitron on panel size, ethnic balance, and other key components relating to PPM. Aside from the lawyers there are no other guaranteed winners in this case and only serves to tarnish the already hurting radio industry even further.

First Lawsuits, Now A Press Conference--The PPM Fight Continues

Ad Age has posted this video report of a press conference at NY City Hall by political representatives and trade organizations of minority broadcasters. US House of Representatives member Representative Nydia Velazquez (D) of New York stated, "we must ensure the voices of minorities are not silenced and this is exactly what Arbitron will do."

Pretty strong words. Watch for yourself, but it seems to me the claim that Arbitron is purposefully trying to put minority broadcasters out of business is quite a stretch.

Suits, Countersuits and a Voice of Reason

The PPM saga continues. You've read about it and no doubt have an opinion.

Here's mine:

As I wrote in an earlier post, I am not for giving Arbitron a pass when it comes to sampling: panel size, gender, ethnicity, or geography; however, for the health and benefit of an already hurting broadcast industry I wish this matter would have been dealt with without the notice of the Washington Post, USA Today, NY Times and many others.

Too late.

One has to take notice when the NY and NJ AG's refer to PPM data as "fraudulent." In my mind that is like calling a car with a couple of bad tires a lemon. You and I both know Arbitron is having difficulty conducting research in ALL markets--not just those markets in which they are deploying PPM. Conducting research of any kind today is fraught with recruitment issues. Problematic, yes, fraudulent, I'm not prepared to make that leap. [I also found it disheartening that both the senior and junior senators from Illinois thought this was important enough to comment on. Just what we need--more government opinion inserted into private matters.]

Station owners are spending large sums of money to support PPM and it's Arbitron's duty and responsibility to deliver a market's measurement with as few anomalies and issues as possible. On Mark Ramsey's hear2.0 blog he dives into the data in one PPM market and illuminates some of the issues as one drills down into specific demographics. Frightening. And also reminiscent of the very real problems that occur every month and quarter in diary markets.

And now a pragmatic voice of reason from an individual who is a large stakeholder in PPM's success:

As many African-American and Hispanic broadcasters have been very vocal in their opposition of PPM, the Washington Post ran this article today with comments from Radio One's Alfred Liggins:

Some station executives defend the system, however, maintaining that Arbitron is working the bugs out. "Anytime you adopt a new technology, there are always short-term dislocations," said Alfred C. Liggins III, chief executive of Radio One Inc., the Lanham-based company that owns 53 stations -- including WMMJ and WKYS -- that seek African American listeners. "There's going to be a learning curve. . . . But [electronic measurement] is reality. I'd much rather get reality on the road then delay, delay, delay."

Liggins said that Radio One's stations in Houston and Philadelphia initially saw a steep drop in their ratings when the meters were introduced months ago but that they have since recovered to roughly the same ranking in the market.

Because the meters tell broadcasters who's listening to what within just a few days (compared with weeks under the diary method), stations can quickly "fine-tune" their promotions, commercial breaks and even on-air personalities, he said. In Philadelphia, for instance, Radio One removed a DJ from the air after just a few weeks when his ratings sagged; a similar personnel decision might have taken 18 months with diaries.

"If you're really brilliant and funny, you can keep talking," Liggins said. But as it turns out, "the number of people who really have that ability are few and far between."

Spot on!

Now I hope Mr. Liggins will be looking to hire more of those brilliant and funny talkers to populate additional dayparts on his radio stations. Those are the people who ARE radios future.

A Tale of Two [Arbitron] Diaires

In the not to distant past I was involved with a station that was in a multi-front battle for male audience. In this particular small market there were at least 5 stations vying for the males shares--a tough road no matter how you sliced it.

That brings us to those two pesky male diaries, both from the same household and with enough AQH's to take a station from essentially last to first with a big lead. And since there were so few males diaries to begin with those 2 diaries carried so much weight they were the difference between success and failure! Easily provable with a simple diary review. Good thing Arbitron calls these diary ratings "estimates." Sure, we voiced our concerns, but after numerous rounds of discussion that ratings disaster stood. Magically, the next book was not quite as out of wack.

If I had known all I had to do was call the states Attorney General to complain I would have done it. After all, this stations financial health depended reliable ratings information to sell advertising and to uphold its standing in the market in the face of stiff competition. Wrong. No such help available. This was between a vendor [Arbitron] and its customer [the radio station].

So how did the current PPM battle become not only a state legal issue but a POLITICAL football as well? Of course, the two go hand in hand.

Despite having had my fair share of "discussions" with Arbitron over the years I do not believe they are purposefully trying to screw their clients. I don't fault the complainants either for trying to get the fairest ratings possible, in fact, I applaud and support their desire to get what they are paying for. My objection is making this a news event when it should be handled behind the scenes.

Like any good political fight it is escalating out of control with Arbitron releasing PPM data two days early and the NY AG warning Arbitron, radio stations and ad agencies of the risks they are taking by releasing, using, selling, quoting these potentially "tainted" numbers. (not sure if I should laugh or cry)

While radio is going through a very challenging time (along with everybody else right now) the last thing the industry needs is to be screaming from the rooftops--hey look at us we got even more problems, our fancy new 15 plus years in the making ratings systems stinks!

PPM vs. FCC and Now NYAG

Issues with Arbitron? Really? Knock me over--holy cow! Arbitron? Wow!!!

But seriously...

First the FCC starts poking around and now NYAG Andrew Cuomo is investigating Arbitron.

According to R&R:

"Because of Arbitron's virtual monopoly over ratings in the radio industry, a significant and improper decline in ratings under the PPM methodology could cause minority stations to suffer drastic reductions in advertising revenues. This, in turn, could severely harm minority broadcasting in New York," wrote Cuomo in a Sept. 9 letter to Steve Morris, chairman, president and CEO of Arbitron, and Timothy Smith, executive VP and chief legal officer, legal & business affairs.

More wows! You can read the entire R&R article here.

My friend and research guru Mark Ramsey wrote an excellent piece on the subject on his blog hear2.0. I couldn't have said it better. So I didn't.

Law & Order: PPM

From Radio & Records:

New York AG Investigates PPM

New York attorney general Andrew Cuomo has initiated an investigation into Arbitron's PPM system. Arbitron received a subpoena today from the NYAG's office requesting PPM documents dating back to 2003 and has until Sept. 19 to produce the paperwork.

Okay, I have an idea.

If you don't like the numbers you're getting from the folks you're paying to do the best possible job of audience research, something inherently fraught with error no matter who does it and no matter how well, then make up whatever numbers you want.

Research is not perfect. Ratings are not perfect. The diary methodology is not perfect. PPM is not perfect. The errors exist in every methodology and will slice a different way depending on the details of the methodology. Note I said a "different" way, not a right or wrong one.

But when you define "accurate" as numbers you got under one methodology but not another one, you do not understand what "accurate" means. All ratings are estimates, best guesses based on sampling and response factors which are, to some degree, out of the researcher's control. Further, the very act of changing the response tool will change the ratings - period. And you can't prove they're less "accurate" simply because you don't like the outcome.

There is no such thing as "accurate." There is only such a thing as numbers you like and numbers you don't.

Love 'em or hate 'em, it seems to me that Arbitron has every incentive to provide the best possible audience estimates that radio can afford to pay for.

Should Arbitron be held accountable for doing their very best? Sure.

But how far beyond that should our industry go?

The idea of inviting the FCC into this process is galling enough, but to incite attention from the federal legal eagles and with it the implication of deliberate wrong-doing...this is over the top.

It's a development that will serve to diminish confidence in all radio measurement and in all the stations that use it, regardless of whether that measurement is derived from paper or meters.

Just wait and see.

Cellphone Only Households And Radio

There's a new survey of wireless/landline usage in the US by the National Center for Health Statistics and across all demographic groups the percentage of households that are cellphone only continues to increase. Overall 16% of households in the US are cellphone only. Even among 65+ households cellphone only has grown from .9% in 2004 to 2.2% at the end of 2007. The younger the respondent the greater the percentage of being cellphone only--18-24's are 34.5% cellphone only and 25-29's are 30.6% cellphone only. In the context of radio this trend continues to spell b-i-g trouble for ratings and Arbitron. At last December's Arbitron Radio Advisory Council Meeting the issue of cellphone only sampling was addressed: [note the updated stats in this post]

Mr. Cohen stated that the most recent cell-phone-only statistics from the government indicate that the cell-only percentage for the second half of 2006 was 11.8% overall and 25% among persons 18–24. He said that while the coverage of the landline telephone frame is deteriorating, the costs to recruit cell-only households using traditional telephone frame random-digit dialing (RDD) techniques is several orders of magnitude higher than the cost of recruiting landline households. Some reasons for the higher cost include the higher no-answer rate, lower cooperation rates and the fact that current laws and regulations prohibit the use of auto-dialers, i.e., cell-only household recruitment calls must be hand-dialed.

Arbitron is researching alternative means to bring cell-only households into the sample. The company currently is conducting a field test using an address frame to recruit households. Pending success of the tests, implementation could occur in some markets in 2009.

The Council expressed concern about Arbitron’s current practice of capping cell-phone-only households in its PPM New York service (and other radio first markets beyond Philadelphia) at 5%. Arbitron indicated that it was prepared to use the address-frame sampling method being tested in the Diary service to increase the cell-phone-only portion of the PPM sample if testing proves successful.

With all of the spirited debate recently regarding the ongoing PPM roll-out, largely over sampling, Arbitron is going to have to figure this out and quick. I don't know about you but I find the sentence, "Arbitron is researching alternative ways to bring cell-only households into the sample," frightening. Sounds like a process that is going to move at a snails-pace. Unfortunately, I have yet to hear or read anything that would cause me to adjust my thinking.

In essence, the "more real world accurate" PPM will deliver more accurate results from a potentially tainted and incomplete sample. It seems to me the very item that is causing this problem, cell phones, ought to be part of a future ratings solution.