The FCC has issued a Notice of Inquiry to explore the impact of the portable people meter (“PPM”) upon stations oriented toward minority audiences. The overall concern cited by the Commission is that PPM methodology may undercount the number and loyalty of such stations’ minority radio listeners, which depresses their audience ratings, which, in turn, discourages their advertisers and ultimately impairs their ability to offer local service. Pressure to institute this inquiry ranged from advocacy groups and industry associations to members of Congress and the Commission’s own diversity advisory committee.
The Commission claims authority for its inquiry within its broad powers under the Communications Act to oversee aspects of the industry that affect public service.
It cites as precedent past concerns ranging from the specific (such as video captioning) to the general (studies to assess the scope of video programming competition). Left unexplored, though, are the steps that the Commission would be able to take in order to remedy any perceived adverse impact of PPM.
PPM is a product of Arbitron, Inc., a pre-eminent media research firm whose audience measurements are used by advertisers as well as the Commission itself to define markets and formulate policy. The PPM is a mobile phone-sized device worn by a sample of consumers that detects inaudible signals embedded in broadcast audio in the wearer’s listening environment. As a passive reporting device, it is intended to be more objective and hence more reliable than the former diary recall ratings method.
PPM is already deployed in 14 large markets and is scheduled for all top 50 markets by next year. While Arbitron has defended PPM against its critics, the Media Rating Council, which oversees industry ratings, has declined to accredit PPM in most markets so far. In response to inquiries from the FCC and the Attorneys General of New York, New Jersey and Maryland, Arbitron has taken steps intended to generate a higher level of participation among minorities in order to ensure their proportionate representation in ratings sampling, including increased use of cell phone-only households and improved training for young minority respondents.
A key question in the present inquiry is the effect of PPMs on diversity and competition. Initial PPM ratings show substantially lower levels of minority listening in some markets, when compared to diary results. While supporters of PPM assert that this is simply a reflection of objective data that preclude exaggerated diary responses, critics claim that this anomaly is a function of flaws in deployment and methodology. Among the specific issues for which the Commission’s seeks input are the manner in which participants are selected and encouraged to remain involved in the sampling process, the accuracy of ratings results, and empirical evidence of the impact of lowered PPM ratings on minority-oriented programming.
Arbitron has challenged the Commission’s jurisdiction to investigate its operations and the use to which its data is put by advertisers and other private parties. The Commission notes, however, that it relies upon Arbitron ratings in formulating its ownership policies, and thus has legitimate concern over the extent that PPM-based ratings could produce inaccurate data. The Commission further notes that the PPM system uses signals embedded in broadcasters’ signals and thus may come directly within FCC oversight on that basis alone.
Although relegated to only brief mention, one challenging aspect of the Inquiry is what specific actions, if any, the Commission can take should it determine that PPM data is inaccurate, other than reducing its own reliance upon flawed data.
Even though proponents had urged initiation of a quicker and more potent investigation, and while launched by Acting Chairman Copps, the progress and outcome of this inquiry may provide an early indication of the degree to which the new full FCC, once in place, will take a proactive role in regulating certain day-to-day aspects of the broadcasting business.
— Peter Gutmann of Womble Carlyle Sandridge Rice
