New York AG Sues To Stop PPM Rollout, Arbitron Refuses To Back Down
October 3, 2008 at 1:20 PM (PT)
NEW YORK Attorney General ANDREW CUOMO has sent a letter to ARBITRON announcing his intention to sue the ratings company for launching the PPM, which it describes as "unlawful and deceptive acts and practices in which ARBITRON plans to engage, has engaged and/or continues to engage, and to obtain additional injunctive relief, penalties, damages and such other relief as the Court may deem just and proper." In its own prepared statment, ARBITRON was hardly intimidated by the lawsuit, which it intends to fight "vigorously" as the PPM rollout appears to go on as planned.
"The unlawful and deceptive acts and practices complained of consist of engaging in or planning to engage in repeated and persistent fraudulent and illegal business practices in connection with the marketing and planned commercialization in NEW YORK of the PPM methodology," the suit asserts. "The PPM methodology ARBITRON intends to use beginning on OCTOBER 8th, 2008 in NEW YORK has not been accredited by the MEDIA RATING COUNCIL, the primary accrediting agency for ratings services in the United States, and appears to contain design flaws that will disproportionately impact minority communities, broadcasters and businesses."
Read CUOMO's letter here.
Arbitron's Response: Essentially 'See You In Court'
In response, ARBITRON denied the AG's allegations and pledged to defend itself "vigorously." In a statement to the SEC, it wrote:
ARBITRON is disappointed that the State of NEW YORK Office of the Attorney General has stated its intent to pursue litigation in an effort to stop the implementation of Portable People Meter, a measurement tool that is supported by a majority of the radio industry. We intend to vigorously defend the Company and its interests. We also fear that the radio industry will suffer continued harm and be placed at a competitive disadvantage if PPM is delayed further.
After many years of market trials, and almost two years of commercialization, the PPM is providing more timely and detailed insights into the behavior of radio audiences. These insights have already been used with demonstrated success by radio programmers, including those at Urban and Spanish-language stations.
Radio broadcasters, radio advertisers and ARBITRON all have an important stake in the transition to electronic measurement. At ARBITRON, we appreciate the role that all segments of the radio industry must play during this transition. We reaffirm our commitment to working with all radio broadcasters, agencies, and advertisers to facilitate industry-wide success in an electronically measured world.