Rep Towns:Auditor Finds Problems With Arbitron's People Meter

An independent media ratings auditor has found "persistent problems" with Arbitron Inc.'s (ARB) Portable People Meter that tracks radio audiences, House Oversight Committee Chairman Edolphus Towns, D-N.Y., announced Tuesday.

Arbitron's People Meter is a pager-size device that selected radio listeners carry with them to track the stations they hear. It has been mired in controversy, with some claiming it undercounts minorities, which Arbitron denies.

The device has been investigated by several state attorneys general and is now under Federal Communications Commission review.

Towns launched his own investigation into Arbitron earlier this year after receiving complaints from minority broadcasters about the accuracy of the data. Eventually he was forced to subpoena documents about the People Meter from the Media Rating Council, a congressionally created, independent accreditation group.

The Media Rating Council conducts extensive audits of ratings services like those provided by Arbitron, Nielsen Media Research and Mediafax Inc. Ratings systems that meet the council's standards are allowed to display its seal of approval.

The Media Rating Council's members include broadcasters, media firms and Internet companies, such as Time Warner Cable Inc. (TWC), CBS Corp. (CBS) and Microsoft Corp. (MSFT).

The council doesn't generally release details about its findings.

According to the House Oversight Committee, the rating council said Arbitron consistently undercounts minority populations across the country. In New York City, for example, Arbitron undercounted Hispanic and African American populations by several percentage points, it said.

The rating council also said Arbitron's sample sizes were "unacceptably low" to accurately measure minority audiences' listening habits, according to the committee.

The Media Rating Council has signed off on Arbitron's People Meter in two markets, Houston and Riverside-San Bernadino, Calif. The council has also given the thumbs up to other Arbitron rating services like listening diaries and custom survey reports.

-By Fawn Johnson, Dow Jones Newswires; 202-862-9263; [e-mail]