Media: The PPM Comes to Canada

TORONTO, ONTARIO - Anyone that has looked seriously at radio station ratings in North America for the past quarter-century, as I have been known to do, knows not to take the exact numbers too seriously. The diary method used by Arbitron Incorporated to measure radio listenership has inherent flaws and has been prone to fluctuating results that did not reflect actual changes in the market. However, Arbitron has been moving to a new technology, the Portable People Meter or PPM, that has different characteristics and may change what we hear on the radio. Furthermore, the PPM will come soon to Canada, as well as the United States--the first Canadian PPM data went to some stations just today.

Commercial radio stations care about their ratings because they effectively determine the advertising rates that they can charge. Armed with the data they have purchased from Arbitron, they can tell advertisers exactly how many people in any given demographic listen to their broadcasts, and hence the advertisements they carry. While Arbitron makes public its "12+" numbers, or ratings for all listeners age 12 or greater, most advertisers care about the "25-54" ratings, or listeners between the ages of 25 and 54, and some care about gender-based ratings as well--and those ratings are often different than the more widely-reported "12+" numbers. While public radio stations do not sell advertising and hence usually do not purchase data from Arbitron (and thus do not appear in the ratings), many of the major stations do use ratings to gauge how well they are serving the public (in the case of CBC Radio in Canada, for example) or to use as fodder in attracting underwriting (especially stations that are highly-ranked in their local markets, like WBUR in Boston and KUOW in Seattle).

Traditionally, these ratings have been determined by Arbitron using diaries. After finding a representative sample of listeners, Arbitron gave them notebooks to record the programs they had heard. The good thing about that system is that the programming had to make a real impression on the listener such that they remembered how to record it in the notebook, which means any advertising in it would likely also have had a chance to be remembered. However, it was obviously prone to human error. When I was in the San Francisco Bay Area, a common tale was that Arbitron had many notebooks that claimed to have listened to the BBC news at the top of the hour during morning drive on KQED-FM. The only problem was that KQED-FM carried NPR news. Rival public station KALW actually ran the BBC--but their call letters were so un-memorable that listeners would think they were listening to the memorable call letters, KQED. The accuracy of the diaries was always in doubt.

To solve this problem, Arbitron has turned to the PPM. Instead of asking its participants to fill out a diary, it is asking them to wear a device that detects special, non-audible encoding in radio audio that identifies a station in the wearer's environment. In addition to recording what the wearer hears in their home and in their car, the PPM will pick up the background noise in a store or dentist's office, assuming it is of listenable volume. Right there, one would expect the ratings to change--stations that serve as background, especially "soft adult contemporary" stations like New York's WLTW "Lite-FM", Boston's WMJX "Magic 106.7" or Seattle's KRWM "Warm 106.9" would be expected to get a bounce.

All reports seem to be that the PPM does pick up the encoding signal quite well, impressing skeptical engineers--though there is some question about picking up distant signals (people that listen to, say, WXLO out of Worcester in Boston or KXXO Olympia in Seattle, both of which I was personally known to do on occasion and both stations currently show up in those market ratings). There seem to be deeper issues with the PPM, however. While an attachment is provided to allow the monitoring of radio listened to on headphones, it has to be inserted between the headphone jack and the headphones with each use of the headphone device, something that I personally can't imagine doing every time I turn on a Walkman-type device. The PPM must detect motion or it assumes it is not being worn and shuts off. Thus, it will miss radio listened to at bedside in the morning or before falling asleep, or during showering. These are key radio listening times for some people.

Blog reader Urban Stiess from Los Angeles wrote that he had seen the PPM device about a year ago at a Society of Broadcast Engineers meeting. Said Stiess, "I was probably the only one present who was NOT impressed. Where others saw less required human cooperation in the process - I saw nothing more than a quick, less labor intensive, method of generating numbers regardless of accuracy."

Of course, Arbitron hasn't really been known for accuracy under the diary system, either. I used to say that it was one of the best-named companies in the world, as its results were entirely arbitrary. (The company name actually came from a device by that name developed when the company was called the American Research Bureau.) While many a radio station made a decision based on a single quarterly ratings book, wiser heads looked for trends over multiple quarters as any given book could have strange results. The PPM was designed to end that--Stiess is not the only one who questions whether it actually will.

The fact of the matter is that we do not know what impact the PPM will have on radio ratings and hence on programming. There simply hasn't been enough published data from the PPM available to compare with older diary data. Early tests in New York seemed to imply that besides the pro-light rock effect described earlier that the new ratings tended to favor active rock stations and show lower listenership to ethnic radio stations.

That early result has resulted in political attention. Just yesterday, the Wall Street Journal reported that a Democrat on the US Federal Communications Commission (FCC), Jonathan Adelstein, was calling for FCC Chairman Kevin Martin to investigate the PPM, saying that the system "constitutes a clear and present danger to media diversity." Arbitron claims the FCC has no jurisdiction--and it's probably correct. New legislation on radio advertising would probably be required for the FCC to have any say in how radio stations use privately-commissioned ratings to sell advertising.

Lest this seem like a problem for the US, Arbitron has the contract for radio ratings in Canada, and it is rolling out the PPM here as well, starting in the Montreal market where the last diary-based ratings will come out on 27-November and the first PPM-based ratings will appear on 10-December and monthly thereafter. At 2:15 pm Eastern on Friday, Astral Media will have a live webcast about the PPM results in Montreal, which interested readers may want to watch. Most other major markets in Canada, including Toronto, will move to PPM measurement in the fall of 2009.

It's too early to know the impact of the PPM on radio in the United States and Canada. We may have to put up with more "light rock, less talk." We may lose ethnic programming. Until we have numbers, we won't have an intelligent way to evaluate the situation. I eagerly await some data.