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Bob Neil rips Arbitron's Portable People Meter

Cox Radio (N:CXR) CEO Bob Neil tore into Arbitron's (N:ARB) Portable People Meter in his company's quarterly conference call, charging that PPM is outdated technology and saying that it will be bad for the radio business.

Asked about PPM by Bear Stearns & Co. analyst Victor Miller, the normally reserved Neil became heated in his denunciation of Arbitron's pet project.

Hear what Bob Neil had to say, or read on.

Recalling that he had served on an NAB committee in the early 1990 which got the first look at a device that Arbitron thought was going to revolutionize radio ratings. "It was in essence the exact same device they are now pushing right now, which is mid-80s technology," Neil said. "It is, in my opinion, bad technology, it's bad research, it's not good for our business and I think as more people are waking up and looking at it - - and looking at the downsides of it - - that my peers in other radio companies, the more they come to know about it the more they're going to not like it."

Miller pressed for more.

"It doesn't capture all of the radio listening, for one thing. If you happen to jog in the morning with one of those headset radios that a lot of people use nowadays, it won't capture any of the listening. I could come up with a long litany of things - - I don't want to take up the whole call with - - but there technologically are a number of flaws in it that don't capture radio listening even as well as the diaries - - which everybody thinks isn't the best instrument, but it's definitely better than the People Meter is at this point. So until Arbitron takes the time to find out what their customers want and spend some time listening - - which is difficult for them, because they're a monopoly - - then they're going to have some trouble with it. Like I said, as more people find out about it, the less they're going to like it," Neil concluded.

But the issue came back again later in the call, with Bishop Cheen of Wachovia Securities asking how radio ad buyers are viewing PPM.

"Well Bishop, that's an interesting question. Historically Arbitron has been more responsive to media buyers than they have been to the radio industry. It's a little bit upside down - - they've responded more to the people who don't pay for it than the people who do pay for it," Neil complained. "But at this point, I'm not familiar with anything going on with the media buying community - - in terms of whether they've come out and taken a position on the People Meter one way or the other. I know most of the discussion has still been within radio, not the media buying community."

RBR Observation:

Don't hold back Bob, tell us how you really feel!

Arbitron may be staking its future on PPM, but it's no slam dunk with the radio groups. As we reported last month, Arbitron CEO Steve Morris has conceded that due to concerns within the radio industry about how the technology and methodology works, PPM could be rolled out for TV and cable before it's used by Arbitron's historical customer base - - radio. Of course, that's dependent on Arbitron completing a joint venture deal with its TV/cable counterpart, Nielsen. PPM still has many hurdles to clear.

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