Green Room

Nielsen buys Arbitron for $1 billion

posted at 1:12 pm on December 19, 2012 by

For the past several decades, Nielsen has measured TV ratings and Arbitron, radio. The ratings they produce dictate ad costs and whether programs get canceled. As technologies improved, both companies have switched from a system of paper diary-keeping to a combination of paper diaries and electronic devices. Radio ratings have always been harder to capture than TV ratings.

Nielsen can easily stick a device on a household’s TVs or remotes (they do both) to see what its owners are watching, but recording what a person hears on the radio requires they wear a device on them. The Portable People Meter, as it’s called, picks up ambient radio signals whether you’re in the mall or your car, but it has the downside of making you look like you’re wearing a beeper. They’re expensive, so Arbitron ended up with a rather small and unchanging sample for a lot of its radio ratings.

I wonder if the acquisition by Nielsen will allow them to put more PPPs in the field and improve monitoring of online streaming and the like. From the press release:

“U.S. consumers spend almost 2 hours a day with radio. It is and will continue to be a vibrant and important advertising medium,” said Nielsen Chief Executive Officer David Calhoun. “Arbitron will help Nielsen better solve for unmeasured areas of media consumption, including streaming audio and out-of-home. The high level of engagement with radio and TV among rapidly growing multicultural audiences makes this central to Nielsen’s priorities.”

With Arbitron assets, Nielsen intends to further expand its “Watch” segment’s audience measurement across screens and forms of listening. “These integrated, innovative capabilities will enable broader measurement of consumer media behavior in more markets around the world,” said Steve Hasker, Nielsen President of Global Media Products and Advertiser Solutions. “We will also bring local clients greater visibility to empower more precise advertising placement and campaign effectiveness.”

“Radio reaches more than 92 percent of all American teens and adults because they love to listen to music, talk, news and information while at home, at work and in their cars,” said William T. Kerr, President and Chief Executive Officer of Arbitron. “By combining Nielsen’s global capabilities and scale with Arbitron’s unique radio measurement and listening information, advertisers and media clients will have better insights into consumer behavior and the return on marketing investments.”

I’ve had an interest in how the ratings work since long before I got into radio and TV. I was a Nielsen family (yes, they exist!) for two years in the early 2000s, and I was drunk with power. When I was on the radio, I learned about the PPP. Frankly, it’s amazing how relatively sloppy ratings systems have always been given how much money and media they influence. As technology gets better and we start streaming and downloading almost everything in easily measurable chunks, the data will get better. And, given Big Data’s influence on this election, Nielsen’s improving data will be allowing candidates to connect your teen-vampire show addiction with the political messaging that works for you.

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Comments

We were a Nielsen household recently…for a week, when they got back the survey and saw that we don’t watch broadcast or cable TV (we do online, but not via the tube) :)

changer1701 on December 19, 2012 at 1:22 PM

I doubt Arbitron would want me to have one of those PPP’s. I almost always change the station the minute commercials start playing.

Bitter Clinger on December 19, 2012 at 1:44 PM

changer1701 on December 19, 2012 at 1:22 PM

Same – though not having been a Nielsen house.

Sure, we watch plenty of videos and a rare show on the internet, but it’s a very rare occasion that our tv is on for “tv”, and then it’s usually to watch the weather radar during a storm. We stopped watching tv with any regularity about 6 years ago. Too much other stuff to do. TV takes away so much time… the internet is bad enough for that already – and that’s my news source.

Arbitron probably wouldn’t be too bad, but then again, I tend to listen to two Christian radio stations that are listener supported… so no commercial ads.

Logus on December 19, 2012 at 2:07 PM

Same – though not having been a Nielsen house.

Sure, we watch plenty of videos and a rare show on the internet, but it’s a very rare occasion that our tv is on for “tv”, and then it’s usually to watch the weather radar during a storm. We stopped watching tv with any regularity about 6 years ago. Too much other stuff to do. TV takes away so much time… the internet is bad enough for that already – and that’s my news source.

Arbitron probably wouldn’t be too bad, but then again, I tend to listen to two Christian radio stations that are listener supported… so no commercial ads.

Logus on December 19, 2012 at 2:07 PM

Yeah, there’s just not much on that we’re interested in, even when there is time for it. Plus, via streaming online, you can find a lot of it anyway.

changer1701 on December 19, 2012 at 2:25 PM

Plus, via streaming online, you can find a lot of it anyway.

changer1701 on December 19, 2012 at 2:25 PM

Some pointers, please? I do Hulu, but a lot of stuff on there is premium content. Some of the channel sites I’ve been to either make it very hard to find their programming or require a subscription to their tv service.

GWB on December 19, 2012 at 3:35 PM