• by Erik Sass  @eriksass1, August 20, 2007

The CEOs of some of America's largest radio broadcasters are unhappy with Arbitron's new passive electronic measurement service, based on its Portable People Meter. While most big radio station owners have signed multi-year contracts with Arbitron for PPM ratings, their growing chorus of complaints suggests that Arbitron--and the radio industry in general--can look forward to a rocky 2008 and beyond.

The backlash began with Arbitron's release of its first commercialized ratings from PPM in Houston and Philadelphia in mid-July. The first and most serious issue is sample integrity. While Arbitron has filed a patent for its method to ensure that panelists carry the PPM at all times, the mysterious method doesn't seem to be working well, as participants leave the device docked in its charger for increasing periods of time. As of the end of July, the Philadelphia sample was down 23% and Houston 15%--significant declines that could affect the statistical validity of ratings data.

Arbitron is scrambling to fix the sample problems, but this will almost certainly be a lengthy process, according to chief research officer Bob Patchen. It requires culling the samples of non-participants and recruiting replacements. During a conference call on August 15, Patchen said the Philadelphia panel would be fixed by the end of September and Houston by the first half of October.

The sample issues prompted Bob Neil, CEO of Cox Radio, to lash out at Arbitron during his company's quarterly conference call on August 1--citing "massive problems" with the samples in those two markets.

Neil was joined in his criticism by Alfred Liggins III, CEO of Radio One, who described "wild swings in the ratings" from Houston PPM measurements. This phenomenon may be related to "unusual listening patterns" that earlier forced Arbitron to delay the release of Houston data covering May 17-23. Bruce Beasley, of Beasley Broadcasting, added that inaccuracies in the PPM data for Philadelphia had created doubt among media buyers, leading to lower revenue in that market.

One of the problems Arbitron must address is under-representation of minority audiences--particularly African-American men, who are a key demo for urban broadcasters like Radio One. That's according to the National Association of Black Owned Broadcasters, which criticized "significant flaws" in the PPM service in an official statement on August 16. NABOB said the two most important age cohorts--18-24 and 25-54--both suffered from substantial under-representation.

NABOB chairman Jim Winston called the new technology "flawed," adding: "We have seen all radio audiences decline, and urban radio station audiences decline significantly, under PPM. Early on, we expressed to Arbitron the problems of reliability of their data caused by the low sample size used, particularly among African-Americans in the 18-24 demo. "The samples in both Philadelphia and Houston for this demo have been consistently and substantially below the proportion of the population represented by this demo," he adds, "and substantially below the sample size Arbitron set for itself to reach."