The House Oversight and Government Reform Committee is set to hold a hearing on Wednesday, December 2, to examine Arbitron’s radio audience measurement device, the Portable People Meter (PPM).

The government’s intrusion into the measurement of media audiences is fraught with problems, illustrated by this quote from the chairman of the committee – Congressman Ed Towns, from the second paragraph of the committee’s announcement:

“With an unprecedented decline in ratings among popular minority television and radio stations, we must explore the possibility of methodological flaws in the implementation of the PPM,” said Chairman Towns. “As it stands now, the current system jeopardizes the future of minority broadcasting.”

Congressman Towns, what connection would a “decline in ratings among popular minority television…stations” have to do with PPM? PPM only officially measures radio, and even if Arbitron did measure local TV, there could be no decline in ratings because there are no pre-ppm ratings from Arbitron to compare to!

Here’s more from this press release – pay attention to the bolded portion in particular:

Chairman Towns served a subpoena to the Media Ratings Council (MRC) in September 2009 for documents detailing its oversight of Arbitron’s use of the PPM, after Arbitron forbid MRC from releasing documents related to the Committee’s investigation. Although Arbitron promised full cooperation with the investigation, the company prohibited MRC from providing the Committee with any documents related to the PPM. Furthermore, Arbitron provided the Committee with insufficient documents that were either publicly available or biased toward the company.

So – the Congressman wants more documents that are “…publicly available or biased towards the company?” Huh?

This hearing should be interesting. Not because the subject is particularly compelling, but because it may be an illustration of exactly why government shouldn’t be involved with issues like the measurement of media exposure.

If Congressman Towns’ and the Committee’s statements are indicative of the way the hearing will proceed – discussions of why the PPM has reduced TV ratings and why Arbitron hasn’t provided the Committee with more publicly available or biased documents – then Congress will have wasted valuable treasure of time and resources.

Ibiquity and a company called Gigaware yesterday announced an accessory for the iPhone/iPod Touch that brings HD radio to the device. You can pick up this little add-on at your local Radio Shack store (whatever happened to their plan to just call themselves “The Shack?) for about $80.

Here’s a link to The Wall Street Journal’s Lauren Goode article and her interview with Bob Struble, CEO of Ibiquity.

This accessory has generated a fair amount of buzz around the internets. Many people are saying that one of the major selling points of the new Zune is the HD radio inside. Before today, I can’t remember anyone saying that.

This accessory is very similar to the analog FM radio accessory that has been available for iPods for years. It plugs into the accessory connector on the device. There’s a tuning control that you can use to navigate the radio’s presets which connects to the device through a wire. There’s also an app that you install from the iTunes store – free, but necessary for the HD Radio to function. The HD Radio dongle has an iTunes tagging feature so that you can identify songs you wish to purchase later by clicking a button on the tuning control.

I own the standard iPod FM radio; it is useful on trips when I want to monitor local radio and I am not in a rental car. It has an RDS display right on the iPod – which highlights to me how poorly stations are at implementing this potentially extremely valuable tool.

So – the questions are, will people pay $80 for a radio in their iPhone when they can purchase a portable HD radio for $50? And – do people really care about having a broadcast radio receiver in their iPhone/Touch when there are so many other options available to them via iPhone/Touch apps?

My guess is that until the software that drives the HD radio is integrated with a streaming radio application in such a way that I can choose my over-the-air HD radio station or my streaming audio channel with the click of a pre-set, this won’t be a very strong offering. There’s a lot of potential power in this app that resides on the iPhone’s desktop. Smart folks will figure out how to tap into it.

The physical clunkiness of the connection to the phone may also deter people from using it. The connection of the original iPod FM radio is almost exactly the same and I find that it’s annoying. The wires get in the way.

However, it’s a start. Let’s see how this goes – maybe we’ll be able to pick these up cheaply on eBay after Christmas!

WRNR, a Baltimore/DC area alternative radio station, was a promotional sponsor of the 12th annual “Maritime Republic of Eastport Tug o’ War,” held this past Saturday in Annapolis and Eastport, MD.

I heard about the event on ‘RNR and decided to go. It was a great afternoon of music, food and fun – including a tug of war between Eastport and Annapolis.

‘RNR was there – with a logo-covered tent, a table with station merchandise, and lots of signage all around the venue. A fairly standard radio presence.

But – there was another media outlet there, doing something that the folks at ‘RNR could have very easily done.

The Sailing Channel video streamed the entire event live on uStream!

The Sailing Channel?

‘RNR could have done exactly the same thing – or, teamed up with The Sailing Channel – and really connected with their audience using a new media platform. All sorts of opportunities presented themselves – interviews with ‘RNR fans, the artists who performed on both the stage in Annapolis and Eastport, personality appearances with the winners.

‘RNR could have produced this, provided talent and imbedded the stream on their home page.

Radio needs to pay much more attention to these opportunities – or be marginalized by other media outlets like, well, The Sailing Channel.

Mark Ramsey has more good stuff on his blog in a week than most people do in their lifetime. Today is no exception. He posts about The Most Important Thing You’ll Read About Radio’s Future this Year. I read this once and said, “Yeah!” Then I read it again.

It suddenly hit me that this is where we were back in the 80s. Marketers were pushing us to become more invested with their marketing. We built teams at stations focused 100% on developing non-transactional business. We called it all sorts of things, from NTR to Vendor. Hundreds, maybe thousands, of bright marketing-oriented people joined these teams either from the ranks of radio sales or from the greater marketing community. We developed relationships with food brokers, wholesalers, marketers at CPG companies, and small marketing teams consulting CPG companies. We learned all about in-store display, push vs. pull marketing, consumer promotion, floor plans, vendor-funded marketing programs. Millions of dollars were invested by radio broadcasters to support these programs and they began to return their investment. We did not sell using Arbitron numbers. We sold using the results of the last program. And, those results were terrific! So, we were able to get more and more marketing dollars for the programs and give up less and less inventory on the station.

And then something happened.

The advertisers said, “You know, let’s go back to buying on Cost per Point. And, while we’re at it, you can throw in all that extra stuff as a freebie for just getting on the buy.” Radio managers caved. NTR/Vendor departments were decommissioned or turned into ghosts of themselves. Smart marketers left radio, were fired in consolidation moves, or they were sucked into the vortex of transactional radio business.

When I think about Mark’s article and the points he makes,

1. Act more like a marketing company than a media company.
2. Be organized around an audience and not a platform.
3. Work directly with marketers.
4. Not just create spaces for ads next to content, it’ll create whole media channels and platforms for brands
5. Employ technologists who can build device-agnostic platforms for marketers.
6. Know how to deliver instantaneous gratification when it comes to measurement, and it’ll be measuring outcomes not outputs. A rating…stat is not going to be enough in the future, and certainly not when it’s presented weeks after the fact.

I can’t help but remember what these same marketers have done time and time again – when it suits their need, they go back to twisting radio’s arm with commodity pricing. And radio lets them do it.

Don’t let them do it again.

Just found a radio engineering blog that is darn good. Definitely worth a read when you want to get your radio geek on…
http://www.engineeringradio.us/blog

In today’s MediaLife, an interview by Diego Vasquez with Bernie Shimkus sheds light on much of the controversy surrounding the rollout of the PPM device. Shimkus is VP/Director of Research at Harmelin Media. Harmelin is one of the largest media buying services on the east coast. Based in Philadelphia, Harmelin’s buyers and research team have been exposed to the PPM longer than people from other markets. As a media buying service, they have no ax to grind – they just want good, accurate data so that their clients can succeed.

In his interview, Diego Vasquez asks, “Are media people still concerned about charges that the PPM undercounts minorities? How much credence do you give these claims?” Shimkus answers:

Media people would be more concerned about those charges if they were based on hard, statistical facts rather than ulterior business motives.

Agencies and advertisers want accurate numbers that represent all groups as much as stations do.

Unfortunately, most of the claims about the undercounting of minorities just aren’t true.

For example, the cume audiences for most ethnic formatted stations have increased significantly under the PPM methodology. Since by definition cume audience represents the number of different people a station reaches in a week, I don’t know how higher cumes for minority stations translates into “undercounting.”

Finally, Vasquez asks, “There have been groups and politicians trying to stop the rollout of the PPM. Do you think any of them will succeed eventually? Or do you expect the issue to eventually die down?” Mr. Shimkus answers:

For the sake of our clients, and the radio industry itself, we certainly hope not. There is a lot of misinformation out there, and even more political posturing based on that misinformation.

This is not an area that politicians should be inserting themselves.

And the radio industry would be better served to stop the bickering with Arbitron, and instead concentrate on using the wealth of new data the PPM provides to make a stronger case for why radio advertising is still an effective media channel for advertisers.

Read the entire interview here.

On Friday, Leo Laporte, founder of the This Week in Tech network of programs, spoke at the Online News Association conference in San Francisco. His comments and the questions from the audience afterwards can be seen here.

The speech is very interesting and it exposes Laporte as a true renaissance man. One of his more controversial comments is a statement that “Podcasting is dead.” This is quite jarring, since it comes from the guy who many of us think as “Mr. Podcast” (OK, Leo, “Mr. Netcast”). He has built a very nice business by delivering 20+ podcasts weekly to an audience now in the millions worldwide. Leo goes on to say that he began to feel that podcasting was “dead” about a year ago and began building a streaming platform so that his network was prepared for the transition. Today, the TWIT Network delivers all its programming both through audio podcasts and via live streams. When there are no live programs to stream, they replay recently recorded programming on the stream.

Of course, he didn’t mean that podcasting was history and that no one is listening anymore. Podcasting has reached a plateau in its growth. Leo noted that for most veteran podcasters, growth began to flatten out about a year ago. To grow audience beyond the people who are willing to put up with podcasting’s current rather chunky user experience, a new archetype needs to emerge. Leo feels that this new archetype is a combination of live and on-demand streaming… different than podcasting’s “store and forward” approach. New dedicated devices like the Roku will provide this kind of service to consumers. In fact, Leo said that he was teaming with Mediafly to provide his network’s offerings on the Roku device.

Many people listen to podcasts right at their PC – either not realizing that they can go portable with their iPod or just not caring too. Many others take their content with them – to the gym, on the road, to work. I have found that loading up my iPod with programming that I want to listen to allows me – with minimal effort – to listen both at home and on the road. My TSL for broadcast radio dropped precipitously when I began doing this and it has not recovered. One of the reasons for this is content; however, the main one is convenience. I can listen to what I want, when I want. The broadcast radio over-the-air streaming model doesn’t allow for that, yet, although the new iPod Nano is providing a baby step in that direction with the “pause listening” feature. On-demand streaming might, but only when the technology reaches mobile platforms.

On-demand streaming is coming – Flycast and other similar services provide a rich portable mobile experience, mixing live broadcasts with some “on demand.” Until ubiquitous wireless broadband is available – and at a price that can be absorbed by the masses – this will remain a platform suffering from similar restrictions to growth that technologies like podcasting are experiencing. Some sort of local storage of content will be needed for some time to come. Many technical folks feel strongly that the wireless IP network is not yet up to the demands of delivering streaming content to portable devices. Today, with relatively few people (some subset of iPhone, Android and Blackberry users) accessing audio streams while mobile, it’s not an issue. Globally, the iPhone has sold about 20 million units. That’s just the population of New York. Imagine all 300 million Americans trying to stream audio at the same time! It’s not a scalable model yet.

So – to answer my rhetorical question – no, podcasts aren’t dead. Podcasts are just going through the same rapid evolutionary process as other delivery vehicles. Smart people, like Leo, are finding ways to augment the audience that the podcast delivery mechanism provides. Others are building alternative distribution channels to iTunes. The concept of podcasts will be with us for a while – until the practical application of technology provides a better solution.

Several months ago, I wrote an article about the potential for battle between Arbitron and Nielsen. It was called “Nielsen, Arbitron and the Upcoming Battle.” You can link to it here.

Since then, Arbitron announced its “ARB-TV” program and just last week the Financial Times broke a story about a new consortium of advertisers and agencies

In today’s “Taylor on Radio-Info,” Tom Taylor had a couple of paragraphs on this topic. He says, in part:

Now, #3, I’m hearing more concrete chatter about Area 51-kinds of research using an electronic detector much smaller than a PPM.

I thought to myself – “huh, top secret development? Didn’t I post a link to the actual photo of the Nielsen Go Meter?”

So, I popped back to the article and – lo and behold – the link to the picture of the “Go-Meter” was broken. A Google search for “Go Meter” or the file name for the original picture turned up nothing. Any reference to the “Go Meter” has been (it seems) removed from the Nielsen website. Interesting.

So – Tom is right. Nielsen HAS gone stealth on its PPM attack project.

Also in his article, Tom mentions the idea of installing encoding software on a cell phone that would perform the function of a device like the PPM. There are many problems with using a mobile device like a cell phone as a measurement device for audience ratings. The biggest one is the instability of the platform. A measurement device for media audience ratings needs to work like a simple appliance. Having other applications running on the platform at the same time raises the possibility of instability exponentially. Thus, the whole platform could crash and detection of media exposure would stop. The way to avoid this is to use an imbedded operating system on a single-function device, like the PPM. These devices can be rock-solid stable with very high levels of reliability. There are also behavioral reasons why the cell-phone solution doesn’t make sense, but this single technical reason is enough.

So – Arbitron and Nielsen are rattling sabers, but in a “muffled” way. It’s clear that the muffles will be taken off the sabers pretty soon. Nielsen will attack Arbitron in the major markets with portable electronic measurement. Arbitron’s move is to encroach upon Nielsen with its ARB-TV project and alignments with companies like TRA and Tivo.

Let the battles begin!

The New York Times recently called attention to a new feature in YouTube called “News Near You.” Tom Taylor, in his Tuesday, August 4th edition of Taylor on Radio, led the top story in his newsletter with:

Just when you thought radio couldn’t get any more competition…Google shows up again, with a new service named “News Near You.”

It strikes me, as opposed to being competition for radio, it’s an opportunity to develop a station’s news image using someone else’s money. A station could cover a local story – say, an exciting city council meeting – and post the video on YouTube, free. They, embed the YouTube video in their website, providing listeners with an enhanced news story, with no video hosting costs to the station. And, here’s where it really gets cool. When someone is looking for local stories on YouTube, there are your station’s news stories, right there with the TV affiliates and so on.

So – another case of where there seems to be competition, there really is opportunity in new media.

Chuck Francis, VP New Media at RemergeMedia.com, wrote a well-received article in Radio Business Report recently called “A New Day for Radio.”

Chuck makes the valid point that, in truth, ratings don’t matter, except to “…those that provide ratings.” However, this common-sense statement misses the mark. Yes, it’s not the ratings that matter to the listener or the advertiser. It’s the thing that the ratings represent.

For example, Chuck says:

In the years I spent as a Program Director I cannot recall one single instance where a listener came up to me at an event or a remote and said: “the reason I listen to your station is because your station the number one station.” In fact, even if your station is 13th in the market – I’d argue you’re number one in the minds of the people that listen to you regularly.

One of the reasons that a listener is loyal to a station is because of its reputation among her peers. The listener doesn’t look at the ratings and make a rational decision about whether or not to listen to a station because it’s #1 in one category or another, but she does decide whether to listen partially based on her peer group’s relationship to the station. The ratings are a surrogate for this – they tell us roughly how many and what kind of people are listening to each station. They tell us about the listeners’ peer groups.

On the advertiser side, the ratings are a surrogate for a true measure of results. In the absence of a way to directly measure the ability of a station to deliver results for a specific product, the ratings system was developed in an attempt to predict what will happen if you run a spot on a station.

Those stations who achieve success without ratings have found other ways to measure their reputation with their audience and to predict the results their advertisers will have when they run a spot on the station. However, I suspect that these substitutes for ratings remain surrogates of a direct measurement of reputation or results.

TRA, a research firm in New York, is developing a very interesting way to measure results in TV advertising… a methodology which could well be transferred to radio and other media. Instead of measuring how many people are viewing a particular program, TRA measures how many people actually were exposed to a specific ad and how many of those people actually purchased the product being advertised. This is similar in many ways to the work that was done on Arbitron and Nielsen’s suspended Project Apollo, but TRA is processing millions of households’ viewing data and matching it up against their purchasing data. As this platform matures and is able to capture not only TV viewing but also other forms of media, we will move away from the surrogacy of ratings and towards the direct measurement of the results of radio campaigns.

Of course, it is not likely that this direct measurement of results will be applicable for all advertisers, particularly local retailers. As data is developed inferences will be possible that are much more precise than today’s rating system. TRA could syndicate their data in such a way as to provide local decision-makers tools to determine which media selections are best for their businesses.

Direct response radio marketers are measuring this today, for their clients. One particularly sophisticated firm, Strategic Media, has literally written the book on the subject. Through extensive testing and results measurement, they have built very detailed databases of the stations and creative execution that works best for their clients. Perhaps local radio can learn from this and develop similar data for their advertisers to use.

Please share your views on this subject by commenting on this article.