Wednesday, April 28, 2010

Arbitron or Arbitrary?

Arbitron and Edison Research have released their “2010 Infinite Dial” Report. I repeat the question I asked them in 2004 at the RAIN Internet Radio Conference held at the NAB 2004 convention (when the Internet total suspected audience size was 32 million)…“How can Arbitron/Edison conduct a relevant study representing over 70 million internet listeners when they did a telephone survey of 1,753 people age 12 and older?”

I mean math was not my strongest subject in school, although I did become a pretty competent and respected data com engineer, and must admit I still shake when I think of my Probabilities & Statistics college class – but please correct me if I’m wrong but isn’t 1% of 70 million equal to 700,000?

Isn’t Arbitron-Edison’s sampling of 1,753 people interviewed in this survey just a little short of even 1% of the Internet’s 70 million total listeners? Years ago I was told that Arbitron’s numbers represented a 12:1 ratio (1 person interviewed = 12 people’s views). So if we even use this equation the number of 1,753 people becomes 21,036 people, which is still a little over 600,000+ short of a 1% sampling.

So although I personally hold Arbitron-Edison’s sampling base suspect, I do applaud them for trying to give us something! However most of the data in their report does not jive with HealthyLife.Net Radio Network’s data. The basis of our demographic breakdown comes from our clubhouse where people actually sign up and give pertinent information that is requested when they join.

Now Morgan Stanley just released an Internet Trends Report. Although not a survey, it is a commentary by various contributors AND Morgan Stanley does add a disclosure statement on their report which reads, “Morgan Stanley does not seek and do business with companies covered in Morgan Stanley research. As a result, Investors should be aware that the firm does have a conflict of interest that could affect the objectivity of Morgan Stanley Research. Investors should consider Morgan Stanley Research as only a single factor in making their investment decision.”

Seems to me that Arbitron/Edison should probably put some type of similar disclosure on their research study since much, if not all, their sources of funds comes from the radio industry who are their clients and thus they may perhaps have a vested interest that may or may not affect objectivity.

The whole point of this is that the radio industry is changing so fast. I wonder if Arbitron-Edison by doing things the same old way of using extrapolated numbers (and make no mistake PPM is still the same old way) are the people who base their decisions on this data truly being served correctly? I just want to go on record that I have my doubts.

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