Nielsen-Arbitron Merger on Hold13 Mar, 2013 By: Doug McPherson
WASHINGTON – The Federal Trade Commission (FTC) wants more information about Nielsen and Arbitron’s proposed merger. Analysts say the request could mean pending regulatory quicksand.
In December, Nielsen agreed to buy Arbitron. Boards of both companies approved the deal, but it’s subject to typical closing conditions, including regulatory review. AdAge has reported that Nielsen withdrew and modified its original notification to the FTC last month – a move it hoped would prevent a so-called “second request” for information. Once the two companies share the information, the FTC gets 30 days to decide the next step.
Regardless, AdAge reports Nielsen’s CEO, David Calhoun, is confident the merger will be approved, despite his company’s virtual monopoly of U.S. TV ratings and Arbitron’s similar dominance in radio ratings, saying they have little overlap.
Nielsen’s CFO, Brian West, in an interview with Forbes, added, “Arbitron is a big deal for us. Our history has been a tuck-in acquisition strategy, two or three a year, you never break the bank. Adding capabilities or platforms that extend our current business model without going too far afield from what we do, and even Arbitron is in that same philosophy.”
But some unnamed industry executives told AdAge they believe the combined companies could monopolize the still nascent market for cross-platform measurement that put TV, radio, digital, print, outdoor and other media on a common metric.
Arbitron’s Portable People Meter data collection system is the only service besides Nielsen accredited by the Media Rating Council to measure TV or radio audiences by person rather than on a household basis, so it can measure demographics used as currency in media deals. That makes it the logical partner for firms such as online ratings provider comScore to compete with Nielsen on cross-platform measurement.
ComScore joined Arbitron in such a project last year with ESPN, and it appears unlikely such collaboration would continue after a merger unless required to do so by regulators. Nielsen didn’t comment on that possibility.
Another Nielsen competitor, Rentrak, which uses set-top box data to measure TV audiences, was also in talks with Arbitron over a cross-media measurement deal before the merger announcement.