As we recently noted, the Federal Communications Commission has announced a Notice of Inquiry regarding Arbitron’s PPM. The Inquiry appears to have been fueled by Hispanic and Urban format complaints that PPM has hurt their business. While PPM defenders will argue that these carping self-absorbed crybabies are hurting radio, their efforts may ultimately benefit all broadcasters.
PPM was supposed to bring radio into the 21st century. Bringing electronic measurement to radio was supposed to help create a level playing field for radio matching the sophistication of both on-line and television audience measurement. Instead, PPM’s lower listening estimates have ended up just reinforcing the impression that radio is in trouble. PPM appears to prove true all the dire predictions of radio’s eminent death. So rather than improve radio’s stature, it has harmed it, hurt revenues, while at the same time dramatically increasing radio station expenses. PPM was supposed to help save radio. PPM has become just another impediment to radio’s revival.
So while an FCC Inquiry is perhaps not the best forum to discuss the intricacies of radio listening estimates, it appears to be the only forum where the relationship between radio’s destruction and PPM has a chance to be heard.
The convention sessions and public forums regarding PPM have always focused on the pitch. PPM has been ceaselessly and tirelessly pitched. In the US, all we’ve been shown is the happy face of PPM. Arbitron has had a much tougher time pitching PPM outside the US.
We like to think of American radio as more mature and sophisticated than radio in other countries, but that’s no longer the case. While American broadcasters were consumed by consolidation, economies of scale, and IPOs, foreign groups were focusing on how to move the medium into the 21st century.
Today, there are many things we can learn from foreign operators. One thing is to be skeptical of Arbitron claims. The very first market test of PPM was not in the United States, it was in the United Kingdom. UK groups were very interested in electronic measurement and provided Arbitron its first live test of PPM.
The difference between American and UK broadcasters, however, was that rather than accept Arbitron’s assurances that everything about PPM works, RAJAR, the radio industry’s rating council insisted on testing PPM. And after the tests were in, RAJAR rejected PPM. UK broadcasters had serious reservations regarding PPM. They chose not to sign with Arbitron.
No such vetting of PPM has taken place in America. In what is supposed to be the toughest most sophisticated radio market in the world, radio rolled over and signed up without asking a single difficult question.
So it has come to an FCC Inquiry.
The likeliest outcome of the inquiry will be a promise from Arbitron that they will work harder to increase ethnic sample size. They will add fractionally to ethnic PPM panel membership and maybe even make a politically astute donation or two and hope the whole matter goes away. It worked in New York and New Jersey.
But there is a small chance that something good will come of this–something that benefits all of radio, not just a couple of operators. If radio takes this opportunity to finally vet PPM and demand that Arbitron provide substantiative answers to serious questions regarding the accuracy and reliability of PPM, maybe radio will get its game back. Maybe it will feel a little less powerless than it feels today.
In that spirit, over the next few weeks we will offer our 10 questions radio needs answered about PPM. Every few days we will post one question and explain why we believe it needs answering. Perhaps some of our questions will make it to the FCC Inquiry, and perhaps radio stations will finally get some answers to critical questions regarding PPM.