TRENTON
-- Attorney General Anne Milgram announced
today that the state has entered into a
settlement agreement with Arbitron, monopoly
provider of ratings services to U.S. radio
stations, under which Arbitron will modify
its audience sampling method to resolve
allegations its existing approach is flawed,
statistically unreliable and undercounts
the listening habits of minority consumers.
Based in New York City, Arbitron is a longtime
seller of survey-based ratings data to radio
stations serving New Jersey, as well as
those in broadcast markets across the country.
In September 2008, New Jersey subpoenaed
information regarding Arbitron’s new,
electronic Portable People Meter (PPM) method
for determining audience share, which the
company had sampled in numerous markets
and was intending to use on a regular basis
in the New–York-New-Jersey market.
Under terms of the settlement, Arbitron
agrees to double the number of cell-phone-only
households sampled, combine an address-based
sampling methodology with telephone-based
sampling, and guarantee a certain level
of participation among all demographic groups.
Arbitron will apply these changes to its
sampling methodology in both the New York
and Philadelphia metropolitan radio markets.
The New York radio market covers significant
portions of north and central New Jersey.
The Philadelphia radio market encompasses
significant portions of southern New Jersey
as well as parts of central New Jersey.
In addition to the other settlement terms,
Arbitron agrees to pay the state $130,000.
Arbitron also agrees to purchase advertising
space of at least $25,000 in trade journals
promoting minority radio and pay $100,000
to the National Association of Black-Owned
Broadcasters (NABOB). That money is to be
used by NABOB in connection with the Spanish
Radio Association to promote minority radio.
“This
is an important settlement, because it will
ensure that Arbitron consumers are receiving
a more accurate sampling product while,
at the same time, ensuring that minority
owned broadcasting outlets are competing
on a more level playing field,” said
Attorney General Milgram.
Under
the settlement, Arbitron admits to no wrongdoing.
Upon
its introduction, Arbitron promoted the
PPM as a tool for gathering data on audience
listening habits, which is then used to
determine market share. ( For commercial
radio stations, market share is directly
tied to advertising revenues.)
When sampled in the Philadelphia-New-Jersey
and New–York-New Jersey markets, the
PPM methodology was denied accreditation
by the Media Ratings Council, a non-government
entity that tests audience ratings for media.
In addition, in markets where the PPM system
was sampled, ratings for minority stations
declined. As part of the settlement announced
today, Arbitron has agreed to obtain MRC
accreditation in both the New York and Philadelphia
markets by the end of 2009.
Among
other things, New Jersey’s subpoena
in September 2008 sought documents concerning
the sampling of Arbitron’s PPM system
in the Houston, New York, Philadelphia and
New Jersey markets, submissions by Arbitron
to the Media Ratings Council regarding accreditation,
and correspondence between Arbitron and
advertisers or radio broadcasters regarding
implementation of PPM.
The
state’s investigation and subsequent
settlement with Arbitron were handled by
the Affirmative Litigation Unit within the
Division of Law.
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