NY and NJ State Attorneys General Sue to Stop Roll Out of PPM - What's A Station to Do?
We recently wrote about the controversy before the FCC about Arbitron's roll-out of the Portable People Meter ("PPM"). A number of broadcast groups, particularly those who target minority audiences with their programming, have requested that the FCC hold a hearing as to whether the introduction of the PPM in a number of major radio markets should be allowed, arguing that it has the potential to discriminate against minority audiences and to decrease diversity in the media. Arbitron and other broadcast groups have opposed the initiation of that proceeding, arguing that the regulation of a ratings service exceeds the FCC's regulatory authority. Now, the opponents of the PPM have sough relief from a number of state and local governments, with the Attorneys General of New York and New Jersey filing suit to prevent the initiation of service by Arbitron. The office of New York Attorney General Andrew Cuomo issued this Press Release, and that of New Jersey Attorney General Anne Milgram issued this Release, citing the reasons for the suit. Both claim that the use of PPM technology, which they claim has methodological flaws, is a deceptive trade practice by a monopoly provider of services. The NJ suit goes on to claim that the disparate effect of the claimed inaccurate measurements on minority and ethnic stations violated the state's anti-discrimination laws. Arbitron of course denies these claims.
The lawsuits have received substantial coverage in both the popular and trade press. Today's Washington Post has an article discussing the controversy. Citing an interview with Alfred Liggins of Radio One, a leading radio group targeting African American listeners, the article suggests that the PPM may take a while for stations to adapt to, but once they do, even minority-targeted stations can obtain valuable programming feedback from the new methodology, as it allows feedback as the ratings information in days rather than the months that that the current diary system requires. This rapid feedback allows broadcasters to make programming adjustments that will allow them to maintain or improve their ratings position. Mark Ramsey's Hear 2.0 blog looks at some anomalies in the PPM in specific demographics, but in another post concludes that despite whatever shortcomings the PPM may have, the industry needs to work with Arbitron on insuring that the PPM works - as an automated system is inherently more reliable than the diary method that relies on listeners recalling and accurately writing down their radio listening.
Regardless of the issues, PPM is a reality in many markets as Arbitron has discontinued the diaries - so the industry will have to work out the issues with the surveys. Until issues are resolved, what are stations in affected markets to do? Obviously, they need to tread carefully to avoid being pulled into the lawsuits and consider the issues with their counsel. But perhaps, as the principal issues identified by the Attorneys General seems to be disclosure of the limitations of the surveys, stations may want to do some disclosure to advertisers on their own of the pending controversies about the methodologies to avoid any claims that they are engaging in any sort of deceptive trade practice.
Watch for more on these lawsuits and the FCC's own proceedings in the next few weeks.
"Disclose to advertisers?" What planet are you on? The agencies get the book for peanuts, the agencies drive the focus on ratings, not the other way around.
Tom:
Sometimes, a legal obligation to disclose does not tell the person to whom the disclosure is made anything new. Certainly, most agencies already know about the controversies about the PPM. But, perhaps other advertisers are not as aware of the issues. As the Attorney General's lawsuits are raising non-disclosure as a principal issue in their lawsuits against the PPM implementation, to avoid getting hit with that same attack, broadcasters who use the PPM results need to avoid getting hit with that same issue - so they should make some disclosure about the controversy about the accuracy of the system. Broadcasters should also consult with counsel about other issues that may arise from the use of this data.