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For Immediate Release:  
For Further Information:
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January 7, 2009  

Lee Moore
609-292-4791

Office of The Attorney General
- Anne Milgram, Attorney General

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AG Milgram Announces Settlement with Arbitron; Company Agrees to Modify Ratings Method, Promote Minority Radio

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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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