Adelstein: FCC To Launch PPM Inquiry

Jim Winston, Executive Director of the National Assocition of Black-Owned Broadcasters(pictured left)

Outgoing FCC Commissioner JONATHAN ADELSTEIN seems determined to go out with a bang -- in terms of getting the FCC involved in ARBITRON's PPM business. After this MORNING's (4/8) FCC meeting, ADELSTEIN told reporters he hoped that the COMMISSION would launch an official inquiry into the methodology behind ARBITRON's PPM meter. He voiced concern that minority-owned and minority-focused stations were continuing to experience dramatic audience losses due to PPM's methodology.

Later, he released a statement that all but assured an imminent inquiry into the PPM. In part it read:

Since our last Diversity Order in 2007, we have heard widespread concerns that the Portable People Meter ratings system, created by ARBITRON, has started to pose a threat to minority- and women-owned stations. The COMMISSION recognizes the important role of advertising revenue in ensuring a diverse ownership of broadcast assets. The potentially inaccurate ratings of PPMs could damage minority- and women-owned stations. I am encouraged that the COMMISSION will soon launch an inquiry I have sought into this audience measurement system so that all the facts and its effect on diversity will be evaluated and brought into light.

We have clear authority over all signals transmitted by broadcasters under section 303(j) of the Communications Act to ensure they are in the public interest. Because encoded broadcast signals are required for the PPM to operate and the measurements are used as currency throughout the broadcasting industry, we have legitimate questions about whether to allow unaccredited systems to be used over the public airwaves, impairing the COMMISSION’s important goals to promote diversity and fair competition under the Communications Act. In light of the challenging economic times and the fact the COMMISSION uses ARBIRTRON’s market definitions and rating data, we need to ensure PPM’s accuracy and reliability. The Commission cannot be left in the dark.

Both this Report and Order and the forthcoming PPM inquiry demonstrate not only the COMMISSION’s commitment to diversity, but also it’s determination to bring all the facts to the table in every decision. I am, therefore, pleased to support this item and the work that lies ahead.

NABOB Exec. Dir & General Counsel JIM WINSTON told ALL ACCESS, "NABOB is very pleased that the Commission is moving on this matter. We hope that the Commission will continue to move forward and initiate further inquiry into PPM."

Recently, ARBITRON reached costly settlements with NEW YORK, NEW JERSEY (NET NEWS 1/7), and MARYLAND over PPM's methodology, which brought forth a list promises in improved performances in areas of concern, (NET NEWS 2/4), with expanded emphasis on ethnic outreach response.

Arbitron Responds

An ARBITRON spokesperson responded to this, telling ALL ACCESS, "ARBITRON is continuing our long-standing discussions with the customers who are members of the NATIONAL ASSOCIATION OF BLACK OWNED BROADCASTERS and the SPANISH RADIO ASSOCIATION as well as our on-going discussions with all our PPM customers.

Continuing, "In these discussions, we are asking for specific ideas for the ways ARBITRON can enhance our PPM services in order to explore ways of incorporating these ideas into our continuous improvement programs for PPM. We have already delivered significant enhancements to the PPM system and continue to work on additional enhancements for the benefit of all our customers.

"One outcome of our discussions: on FEBRUARY 27th, 2009, ARBITRON announced it would voluntarily extend to all PPM markets on a nationwide basis, the key enhancements of our PPM continuous improvement program that we put in place as part of our agreements with the Attorneys General of NEW YORK, NEW JERSEY and MARYLAND.

"THE MEDIA RATING COUNCIL (MRC) was founded at the behest of Congress to audit and accredit audience measurement services. ARBITRON is committed to the MRC process and is actively pursuing accreditation for all PPM markets."

Does The FCC Have Legal Oversight Of The PPM?

However, there are those who doubt that the FCC has the legal right to look into the business practice of ARBITRON that is the PPM. According to Communications Law Attorney GREGG SKALL, who writes the FCC Uncensored column in ALL ACCESS, the COMMISSION just might have that kind of jurisdiction -- but that might not be enough to prevent the issue from inevitably being settled in the courts.

"ADELSTEIN made a very interesting argument for jurisdiction that has legs," he told ALL ACCESS. "The FCC could very well claim jurisdiction over the PPM based on the dual prongs of spectrum utilization and its ancillary affect on broadcasting and the public interest. We'll have to see what they do and how it plays out. In the end, however, even with a valid claim of jurisdiction, the DC COURT OF APPEALS has said numerous times that they will defer to the COMMISSION only for so long before it has to substantiate empirically its views on applying the public interest standard."

Stations Still Launching New Latin And Urban Formats

It's worth noting that PPM is not stopping the sign-on of new Latin and Urban stations in those markets. Examples include ENTRAVISION's debut of Regional Mexican KDLD "EL GATO" replacing Alternative INDIE 103.1 back in JANUARY, GRUPO RADIO CENTRO's announced LMA of EMMIS' Rhythmic AC KMVN and flip to Latin Pop on APRIL 15th, and this week's debut of Urban/Hip Hop STREETZ 102.9/ATLANTA.