Cumulus is acting alone and Dickey says the probability of the new service making it to market is 100%. He also clarified that Cumulus will not own the brand or methodology developed by the winning bidder.
“The interest that we’re getting [from potential bidders] is fabulous. We will have a vendor producing this information by year’s end,” Dickey said. He took issue with RBR/TVBR’s analysis of the RFP, particularly with regard to who would own the rights to the new ratings system. Dickey said in the unlikely event that Cumulus might some day walk away from the ratings system that it had worked so hard to bring to market, the language in the RFP means only that it would retain the right to use past ratings data, unlike the current situation where a broadcaster whose Arbitron license expires has no more right to use any of the historic data that it paid for. Dickey clarified that the research product will not be owned by Cumulus – that the research vendor will brand the product and own the methodology. Cumulus does, however, have to approve any change in methodology, since the ratings service is being created under its RFP.
As for Arbitron’s attempts to compare the Cumulus RFP to the RFP launched by Clear Channel, with other broadcasters participating, for electronic measurement, Dickey says it is “comparing apples and watermelons,” since Cumulus is acting alone, not in a coalition. “What Arbitron did a masterful job in was fracturing that coalition. They got CBS and Joe Hollander to sign preemptively across their entire platform on a five-year contract for PPM – and when Joel Hollander was asked why he did it, he didn’t even know why he did it. He said ‘I felt like I had to do something,’ which was stupid. And so the coalition fell apart and everybody, out of necessity, is now supporting Arbitron’s deployment of electronic measurement, including us,” Dickey explained. “The distinction is, we’re not seeking to form a coalition on this product. We are going to buy this product from a vendor. We don’t need anybody else to pay for it,” he said. Cumulus is ready to put the $8 million it pays Arbitron annually for service in its 100+ markets toward the new service – and possibly even save some money. “So, the probability of our product making it to market is 100%.”
Even though he doesn’t need other broadcasters to support the new service, Dickey said a “who’s who” of radio in medium and small markets expressed interest in subscribing as he encountered them at the NAB Show in Las Vegas.
The Cumulus COO said the target of having the service up and going by the end of this year is doable, since his company has already been in contact with many potential bidders for over three months. Dickey explained why Cumulus is seeking annual measurement, rather than the current twice or four times per year in Arbitron markets. He said having ratings twice or four times per year in smaller markets has been great for ad buyers because there has been so much bounce in the data and, as a result, they can beat up broadcasters on rates. Dickey noted that advertising investments in newspapers, yellow pages and direct mail, which dwarf radio ad spending, are made on the basis of reach information which is annual at best, and every-other-year in the case of newspaper.
Dickey isn’t saying what potential vendors have been contacted, but says many are large companies that do audience research in media, even if they are not known currently in radio. RBR/TVBR and other publications have focused on Eastlan, which operates a competitor to Arbitron already. “Mike Gould is a nice guy, but he runs a very small ship and his company isn’t sized to handle this, for one. Number two, he doesn’t have the background and credibility on a national basis that we’re looking for. We’re encouraging him to go through the process, as we would anybody who wants to participate, but he’s not the answer to this process,” Dickey said.
Cumulus will continue to subscribe to Arbitron in its larger markets, but Dickey is looking forward to the day when diaries are dead and buried. Arbitron has announced PPM rollout plans for the top 50 markets and Dickey expects that to then continue to the top 100. It can’t come soon enough for him.