Clear Channel will write bigger check to Arbitron


CORRECTED INFORMATION as of 9:20 am ET Wednesday, May 6: Arbitron clarified to RBR/TVBR that the $69 million figure is for the entire three-year term of the diary market contract, not the annual amount. The story below is thus incorrect in stating that Clear Channel will be paying more to Arbitron under the new contract.


Despite dropping diary ratings service in a couple of dozen markets, Clear Channel will still pay more to Arbitron. An SEC filing by Arbitron values the new contract at $69 million per year – and that’s before adding in Portable People Meter (PPM) service. Meanwhile, there seems to be some confusion about which markets are – and are not – covered by the new contract.

First, a look at the money. Arbitron says it its SEC filing that the aggregate amount to be paid by Clear Channel under the new three year contract works out to $69 million annually. That includes diary-based Radio Market reports, MaximiSer, Tapscan, Scarborough consumer data, Arbitron qualitative data and related services and software. Also included are a new contract for Premiere Radio Networks to receive RADAR National Radio Network ratings and services and new contracts with Katz Media Group and Clear Channel Traffic.

According to Arbitron’s annual report, Clear Channel accounted for 18% of its revenues in 2008, which RBR/TVBR calculates to be around $66.4 million. So, Clear Channel has agreed to a rate increase – and that’s even before adding in PPM, which is a separate contract. There are also apparently a few stray station contracts not included in the main diary market contract.

The filing that Arbitron made with the SEC Tuesday says the new contract with Clear Channel covers 105 markets. Included in that list are all seven markets where Clear Channel said it will not have any ratings at all and most of the markets where it has already switched to the new Nielsen service.

An Arbitron spokesperson insists that the SEC filing is correct. A Clear Channel spokesperson says Clear Channel is not paying Arbitron for ratings information in the markets it named as being serviced by Nielsen or where it will have no ratings at all and that the company will not be using Arbitron data in those markets. The contract itself is not public, so there appears to be no way to explain the discrepancy.

RBR/TVBR observation: With ratings costs continuing to go up while ad revenues are declining, it is easy to understand why Clear Channel, Cumulus and others are anxious to have Nielsen become a viable competitor to Arbitron in radio ratings and make them compete for the business. And since PPM service is far more expensive that diary ratings, there have no doubt already been talks about whether Nielsen could field a big market competitor to PPM using its “GO Meter” that’s already been tested for measuring out of home TV viewing.