Battle continues over Arbitron metro


Manhattan Broadcasting is still pressing the FCC to disband the newly created Salina-Manhattan, KS metro, which it claims was created to exaggerate ratings for stations owned by Morris Communications and exclude much of the area around Manhattan, where Manhattan Broadcasting’s stations have many listeners (12/28/07 RBR #250). The FCC has been gathering arguments from the parties, but has not issued any ruling. First, though, the Commission will have to resolve the key issue of whether it even has jurisdiction.

“Manhattan Broadcasting has advanced no tenable support for its request that the Commission inject itself into Arbitron’s designation of local radio markets, and the FCC promptly should reject that request,” wrote James Bayes of Wiley Rein as attorney for Morris. Similarly, the attorneys for Arbitron, John Griffin Johnson Jr. and Lisa Roberts of Paul, Hastings, Janofsky & Walker, suggested that the FCC “decline the Letter’s invitation to expend the time and resources of the Commission or its staff attempting to resolve allegations that Commission policy and practice wisely leaved to be resolved in a more appropriate forum.” They noted that should Manhattan Broadcasting choose to take the dispute to a federal or state court or to a regulatory agency that does have jurisdiction, “Arbitron is prepared to defend itself and its business practices in the context of the creation of the Salina-Manhattan, Kansas Metro.”

While Morris denied that the FCC had jurisdiction in the matter, it also denied that there was any “scheme” by it and Arbitron to gerrymander the market boundaries. And Morris lashed out at Manhattan Broadcasting for claiming that Morris’ top radio executive, Michael Osterhout, misused his position on the Arbitron Radio Advisory Council to push through the new market creation. Morris’ attorneys noted that the company had been in discussions with Arbitron on creating a new metro in Kansas for over a year before Osterhout was elected to the RAC.

Manhattan Broadcasting’s attorneys, Richard Zaragoza and Paul Cicelski of Pillsbury Winthrop Shaw Pittman, argue that the FCC has authority to be far more than a “spectrum traffic cop” and should investigate whether Arbitron and Morris conspired to create the new metro to the detriment of competing radio companies. “The Commission does have authority, and indeed an obligation, to become involved where, as here, there are serious public interest impacts created by their conduct,” they said.

“By gerrymandering the Salina-Manhattan Metro, Morris and Arbitron make a mockery of localism,” the filing on behalf of Manhattan Broadcasting said. It said the market configuration will allow Morris to extract most of the national and regional advertising dollars from the new Metro, “leaving the genuinely localized stations to compete among themselves for the fewer and fewer local ad dollars that remain.”

RBR/TVBR observation: Arbitron has modified the Salina-Manhattan Metro to add one additional county near Manhattan as of next month, but that isn’t likely to change Manhattan Broadcasting’s opposition, since it contends that there is no commonality between the two cities, noting that they are even in separate DMAs for Nielsen’s TV ratings. We will be interested to see whether the FCC decides to pick up this hot potato. If the Commission does assert that it has authority over Arbitron metro definitions, it will no doubt have to defend that position in court at some point.