Arbitron’s flawed ratings hurt minority radio

Even in an age of media fragmentation, free, over-the-air radio remains a vital source of news, information and entertainment for millions of Americans. Arbitron, the company that provides radio ratings data, plays a critical role. Its data are used to determine the price broadcasters fetch for advertising, which directly impacts the content that is available on the dial. Arbitron’s responsibility is heightened by the fact that it is the dominant radio ratings firm and is unregulated by government.

Recently, Arbitron has introduced a new rating system called the Portable People Meter (PPM) that requires participants to carry a cell phone-sized device that picks up radio signals. Since its introduction, minority broadcasters have demonstrated that this system undercounts African American and Hispanic listeners. Recognizing the public interest at stake, both Congress and the Federal Communications Commission launched investigations.

This past week, the House Committee for Oversight and Government Reform, under the leadership of Rep. Edolphus Towns (D-N.Y.), released information that demonstrates the depth of the problem.

The Media Ratings Council (MRC), the independent industry body that accredits media ratings systems, turned over its audits of the PPM system to the oversight committee under subpoena. The committee put out a statement to inform the public of the serious flaws in the PPM system that these audits reveal.

According to the statement put out by the committee, the MRC’s documents indicated “persistent problems” with Arbitron’s minority sample audiences. For example, the committee reported that subpoenaed documents showed that a relatively small subset of individuals is providing usable data. In New York City, Arbitron recruited a sample audience of 5,400 people. But only 2,700 persons — half of the sample — provided data. The committee reports that “the radio listening habits of over four million ethnic minorities are represented by only 500 Arbitron recruits.” This paltry sampling is being repeated in cities nationwide, impacting the content available to tens of millions of Americans. This is only one example of the concerns raised by the commission.

It is hard to overstate the magnitude of Arbitron’s dereliction of duty. Americans are now painfully aware of the price paid when financial ratings agencies fail to provide accurate information for the investment world. Arbitron plays just as important a role in the media world. It is no exaggeration to say that unless Arbitron acts in a principled fashion, it has the power to upend the radio marketplace.

That is exactly what is happening today. Since the rollout of the PPM system, Spanish-language and urban-formatted radio stations have seen their ratings plummet. The industry faces the real possibility that these stations will go under and the dial will become even more homogeneous — all because the data that drive the system are simply wrong.

This scathing congressional report should have provided Arbitron with a wake-up call.

Instead, it seems Arbitron is intent on hitting the snooze button. Arbitron’s response lashes out at the committee for reaching “erroneous conclusions.” The allegation is farcical.

Indeed, the committee offered no conclusions — it simply reported the facts it had uncovered in the MRC documents.

Moreover, Arbitron claimed that it has been “open and forthcoming” with Congress. If so, why did the committee have to subpoena the MRC records? Surely, Arbitron could have turned them over voluntarily. The only conclusion is that Arbitron knew those documents contained irrefutable evidence that the PPM system is flawed.

It is time for Arbitron to stop playing games. A critical part of our nation’s media and cultural landscape is at stake. Millions of Americans are counting on them to get this right, so that they don’t lose the radio content upon which they rely. It is not too much to ask the ratings provider to deliver reliable data. It is simply a question of doing its job. That is a message Arbitron must heed.

Shagrin is the executive vice president of research for Univision Communications. Warfield is the president and COO of ICBC Broadcast Holdings.