The FCC today issued a Notice of Inquiry into the use of the Portable People Meter technology of radio audience measurement now being rolled out by Arbitron in radio markets throughout the country.  Several months ago, various groups petitioned the FCC for an inquiry into the PPM, contending that it has certain methodological flaws that undercounted particular groups, including minority groups, and thus could have an impact on the financial viability of the stations listened to by such groups (see our summary  of the petitions and the issues raised by these petitions).  The Notice of Inquiry asks about those perceived flaws, about the potential impact of any flaws on the use of Arbitron market definitions for purposes of the FCC radio multiple ownership rules, and on the more general question of whether the FCC even has the jurisdiction to regulate the use of the PPM.

Specific questions on which the FCC seeks comments include:

  • Does the use of this technology really undercount minority populations?
  • If so, what has been the impact on the economics of minority-formatted stations in markets where the system is in use?
  • Are there specific information gathering techniques that should be improved in the PPM system?
  • What has been the effect on the PPM system of settlements between Arbitron and the Attorneys General of several states – where Arbitron promised to change its sampling process?
  • What is the impact of Media Ratings Council accreditation for the PPM in certain markets, and its lack of accreditation in others?
  • Do the questions about PPM reliability have any impact on the use of Arbitron to define radio markets for FCC multiple ownership purposes?
  • What is the FCC’s jurisdiction to review Arbitron’s practices in connection with the PPM? 

Details of these questions can be found in the FCC’s Notice of Inquiry at pages 12-17.Continue Reading FCC Begins Formal Inquiry Into Arbitron PPM Audience Measurement

At a meeting held this week, the Radio Advertising Bureau (RAB) adopted Guidelines promoting the use of "posting" or audience delivery guarantees for the radio industry.  While these guidelines are voluntary, and no doubt some broadcasters will not adopt the practice, those who do should be aware of the political broadcasting implications.  For years, at political broadcasting seminars that I have conducted around the country, the question of how posting affects the political broadcasting obligations of television broadcasters has been much discussed. In its 1991 policy statement on Political Broadcasting, which essentially established the rules that broadcasters have followed in the years since, the Commission’s entire discussion of how audience underdelivery make good spots affected a station’s political broadcasting obligations was essentially addressed in two sentences – essentially saying that such guarantees must be made available to candidates in the same manner as commercial advertisers.  Thus, stations must offer audience delivery guarantees to political advertisers if they offer such guarantees to commercial advertisers.  The 1992 reconsideration added a few more sentences, making clear that any make-good spots provided to meet any delivery guaranty would not need to be considered in determining the lowest unit charge of the time periods in which the make good runs.  What the Commission leaves to the broadcaster, however, is to fashion a way to compensate the candidate for underdelivery when the underdelivery may not be discovered for months (when the next ratings book is released), which will usually be after the election for which the candidate purchased the spots. 

In the television industry, where posting has been common for years, stations deal with the political implications in many different ways.  First, not all purchased spots will have delivery guarantees. Under Commission rules, spots that have different rights can be considered to be spots of a different class, and each class of spots will have its own lowest unit rate.  Thus, spots with audience delivery guarantees will likely have a higher price than those that do not have the guarantees.  As the make good spots for any underdelivery of audience will be of little value if they are not available until after an election, the candidates will usually opt for the lower priced spots without the guarantees.  Alternatively, stations can offer candidates a discount off of their lowest unit rates for spots with guarantees in exchange for the candidates agreeing to waive any underdelivery make-good spots.  In a few cases, candidates agree to take any make-good spots to which they may be entitled, and use them after the election to thank their supporters or to convey policy positions to their constituents.Continue Reading RAB Adopts Guidelines for “Posting” – Remember to Consider the Political Broadcasting Implications