The FCC and the Flying Purple People Meter.

O.K., technically, it is the Arbitron Portable People Meter (PPM). For those unfamiliar with this issue, Arbitron has rolled out a a new technology it claims will more accurately measure radio audience share. Many folks in the minority community think that the PPM undercounts minority listeners and has serious flaws in its technology. This later claim, at least, is circumstantially supported by the refusal of the Media Rating Council to certify the technology for use in some markets (but apparently permitting it in others). But since the MRC will not disclose the reasons for its refusal, and neither will Arbitron, no one can say anything for certain.

As an aside, I’ll bet it also undercounts low-power FM stations as well. I also have to wonder whether it counts the new digital stations for radios that have converted to digital. But I haven’t made a study of this and only minority broadcasters and organizations concerned with broadcast diversity have raised the issue in a major way.

You may think, “what’s the big deal?” Well, not only does millions of dollars in advertising ride on this, along with major decisions on programming, format, etc., but so does federal policy. Since we have basically outsourced all significant information gathering on mass media (because the private sector is so much more efficient and why would an industry reporter ever have incentive to manipulate the information?), the FCC now relies on Arbitron ratings for a wide variety of ownership rules and policy decisions. For example, the FCC rules prohibit the top four rated broadcast television stations in any given market to merge.

So the FCC has put out a public notice in response to a Petition for an investigation filed by a coalition of minority broadcasters and the Minority Media Telecommunications Council (MMTC) called the PPM Coalition (PPMC). (you can download the Petition here). The FCC can, of course, investigate anything it wants — especially where its rules rely on the validity of the Arbitron rating system. But does the FCC have authority to do anything about Arbitron’s roll out of the Portable People Meter?

Well, if you believe in FCC ancillary authority, then the answer is probably yes. Arbitron and its rating system are clearly ancillary to a variety of FCC statutorily mandated goals. And if the FCC can require Best Buy to put a big sign next to any analog-only televisions saying “Will Not Work After February 17, 2009,” they can require Arbitron to show they are counting everybody. OTOH, if you don’t believe in ancillary authority, it becomes a heck of a lot harder.

Still, as the study itself demonstrates, there is value even in investigation by the FCC and getting the FCC to issue some kind of report. At some level, Arbitron does have to care if people buying advertisements consider its products reliable. It would be even more embarrassing if the FCC concluded it would no longer rely on Arbitron data — something it clearly has the right to do regardless of any authority to directly regulate Arbitron. By contrast, if the FCC gives Arbitron a clean bill of health, it may not satisfy the PPMC, but it will enhance Arbitron’s claims of reliability for the broader market.

Credit to the FCC for getting this out on notice quickly. We’ll just have to see what comes of it.

Stay tuned. . . .

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