NJ AG subpoena Arbitron over PPM Ratings method.

New jersey Attorney General Anne Milgram announced that the state has issued a subpoena to Arbitron, the monopoly provider of ratings services to U.S. radio stations, concerning allegations that its new method for measuring radio station listenership in New Jersey 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. The subpoena issued today seeks information regarding Arbitron’s new, electronic Portable People Meter (PPM) method for determining audience share, which the company has been sampling and will soon begin using on a regular basis in the New–York-New-Jersey market.

The PPM is being promoted by Arbitron 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 has been sampled, ratings for minority stations have declined.

Among other things, today’s subpoena seeks 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 is being conducted by the Affirmative Litigation Unit within the Division of Law.