Another step towards the death of radio

[davideduardo]

Ad agencies use commercial software like Strataview to make ad buys using data from Nielsen, plus ad rates from stations (that is a very simplified description, of course).

Yesterday, Nielsen announced that it would not allow Strataview to use the release data on non-subscribed stations. So agencies would have to do "paper transactions" to buy non-Nielsen stations and would have to request separate dayparts and rates from each station.

I predict some agencies will say, "The heck with it. Just don't buy radio" and be done with it.

I hear bagpipes. It must be a funeral.

 

[TheBigA]

This is why radio needs to break free from the chokehold of the monopoly that Nielsen has over ratings. Nielsen is more concerned its own financial survival than any of its clients.

The reality is the stations that don't subscribe don't actually need the ratings. They sell directly to clients. So this won't hurt them one bit.

 

[davideduardo]

This is why radio needs to break free from the chokehold of the monopoly that Nielsen has over ratings. Nielsen is more concerned its own financial survival than any of its clients.

The reality is the stations that don't subscribe don't actually need the ratings. They sell directly to clients. So this won't hurt them one bit.

There are many significant groups such as Town Square and some of the Saga markets that do not subscribe, but agencies used the Nielsen data to place buys. Now, the agencies won't be able to use the Nielsen data in their buy software so they will have to do the work manually... not likely.

 

[boombox4]

Ad agencies use commercial software like Strataview to make ad buys using data from Nielsen, plus ad rates from stations (that is a very simplified description, of course).

Yesterday, Nielsen announced that it would not allow Strataview to use the release data on non-subscribed stations. So agencies would have to do "paper transactions" to buy non-Nielsen stations and would have to request separate dayparts and rates from each station.

I predict some agencies will say, "The heck with it. Just don't buy radio" and be done with it.

I hear bagpipes. It must be a funeral.

What is the percentage of non-subscribed stations? The only ones I can think of in my own metro are some of the brokered and religious ones.

 

[PTBoardOp94]

This is why radio needs to break free from the chokehold of the monopoly that Nielsen has over ratings. Nielsen is more concerned its own financial survival than any of its clients.

I agree, but I also don't think it would help radio's credibility if there were two sets of ratings for Minneapolis, with different results. If Nielsen found WCCO #5 overall, and Eduardo and Associates found WCCO ranked #12, what says to customers is that no one knows who's out there.

 

[PTBoardOp94]

What is the percentage of non-subscribed stations? The only ones I can think of in my own metro are some of the brokered and religious ones.

Think about it this way: if you take the sum of all the published stations in Minneapolis's ratings, that's 91 of 100 shares that are accounted for. In my market, which is much smaller, the published ratings don't even encompass 60 of the 100 possible shares.

The biggest difference is that my market does not have any non-comms or rimshot signals subscribing, but there are some of those subscribing in Minneapolis.

 

[CTListener]

What is the percentage of non-subscribed stations? The only ones I can think of in my own metro are some of the brokered and religious ones.

In Springfield, Mass., Saga owns heritage classic rocker WAQY and alternative rocker WLZX. I assume that WAQY has a sizable audience and bills well, as do classic rock stations throughout New England. That would be a good chunk missing from the Nielsens.

 

[TheBigA]

There are many significant groups such as Town Square and some of the Saga markets that do not subscribe, but agencies used the Nielsen data to place buys. Now, the agencies won't be able to use the Nielsen data in their buy software so they will have to do the work manually... not likely.

Sounds like extortion. It's that kind of thing the government looks at when determining if a company is operating as a monopoly.

 

[davideduardo]

I agree, but I also don't think it would help radio's credibility if there were two sets of ratings for Minneapolis, with different results. If Nielsen found WCCO #5 overall, and Eduardo and Associates found WCCO ranked #12, what says to customers is that no one knows who's out there.

Arbitron started in '65, competing with Pulse and Hooper. Hooper called it quits in the early 70's and Pulse issued its last book in 1978. .

Since then we have had a variety of attempts to compete with Arbitron, the biggest being Birch but including several others; none has lasted.

 

[frankberry]

Sounds like extortion. It's that kind of thing the government looks at when determining if a company is operating as a monopoly.

Not extortion. Nielsen provides a valuable service which helps broadcast stations make more money. I view it as part of the cost of doing business.

 

[TheBigA]

Not extortion. Nielsen provides a valuable service which helps broadcast stations make more money. I view it as part of the cost of doing business.

The extortion part is if a station doesn't subscribe, Nielsen won't include that station in the numbers it sends to Strataview. They're playing hardball.

Stations are facing terrible financial problems. Advertisers have demanded that we cut our rates because of lower listening during the pandemic. Lower advertising means we have to cut staff. Nielsen hasn't cut its subscription rate, even though it tells stations their numbers shouldn't be used right now. That's unfair.

 

[davideduardo]

Not extortion. Nielsen provides a valuable service which helps broadcast stations make more money. I view it as part of the cost of doing business.

What they are doing is trying to force companies that don't subscribe but do get agency billing to pay for the book as they are getting the benefits of the subscription without paying.

For those unfamiliar with the whole process, Nielsen provides data on all qualifying stations to subscribers. That means every subscribed station, no matter how low a rating/share/AQH they have and all non-subscribed ones with a rating of 0.1 or higher.

So an agency that gets the full book could buy an unsubscribed station just as easily as a subscribed one. It's always been that way.

But now the data provided to agencies for the widely used software that lets them calculate the stations that reach client targets at the best rates will not include non-subscribers.

There are some significant companies that don't buy the book either at all or for some markets. Townsquare, Saga, Univision are among them.

 

[TheBigA]

What they are doing is trying to force companies that don't subscribe but do get agency billing to pay for the book as they are getting the benefits of the subscription without paying.

That's extortion. They won't do something they've always done unless everyone pays. Meanwhile they tell the people who DO pay now to use those numbers now.

If they want to force stations to do this, they need to at least be flexible in pricing.

 

[Don CT]

Is there anything other than Nielson? If not it is a monopoly.

 

[davideduardo]

Is there anything other than Nielson? If not it is a monopoly.

There are legal definitions of monopoly that allow for a single provider in the case that nobody else wants to compete. In the cased of the Arbitron competitors, none was driven out of business by questionable or illegal practices. Simply, not enough stations supported them for the business to prosper, so they ceased.

There is no impediment for another company to do radio ratings.

Name another US manufacturer of long range and large capacity passenger aircraft that is not Boeing.

 

[davideduardo]

That's extortion. They won't do something they've always done unless everyone pays. Meanwhile they tell the people who DO pay now to use those numbers now.

If they want to force stations to do this, they need to at least be flexible in pricing.

I think the issue is that the radio ratings are likely not profitable.

Most groups have cancelled the additional services that give deeper analysis of the numbers. Many have cancelled smaller markets.

So they have less income from subscribers and fewer subscribers.

I suspect that they are considering moving back to the diary for radio. PPM is now too expensive for the industry. And what Nielsen wanted when they bought Arbitron was the technology; they own it now for TV and any other audio service.

A long shot: Nielsen keeps the PPM tech, licenses it back to a new company that buys the radio division.

 

[davideduardo]

What is the percentage of non-subscribed stations? The only ones I can think of in my own metro are some of the brokered and religious ones.

The percentage is growing, but the biggest loss to Nielsen has been in the additional services they sell to subscribers. Nearly everyone has cancelled or cut those.

 

[TheBigA]

I think the issue is that the radio ratings are likely not profitable.

What you're saying isn't the death of radio, but the death of Nielsen.

Nobody in radio will shed a tear if they go back to diaries. They just need some numbers to sell. If local numbers aren't usable any more, radio companies will sell national numbers. That's where things are going anyway. There will still be small stations doing transactional selling. But everyone else will do programatic.

 

[TheBigA]

Add Summit Media to the list of radio owners who are scaling back on Nielsen:

http://www.insideradio.com/free/sum...cle_e58027e8-14fb-11eb-ae6e-6f685dbd6f09.html

 

[Groove1670]

Not extortion. Nielsen provides a valuable service which helps broadcast stations make more money. I view it as part of the cost of doing business.

A valuable service for who? IHeart, Cumulus? When you have groups like Saga and Townsquare dropping the service it is no longer a valuable service. When you block out non-subscribers it is no longer a valuable service.
However some won't be impacted: "The only exception will be for minority/ female owned companies with market billing below $7million, 501 C3 non-profits"

There is Eastlan. However, unless you want to pound your chest to local advertisers how good is it?
Agencies? KATZ (I Heart) Places buys for over 4000 stations. Gen Media Partners gets the scraps and places buys with the remaining stations.

In reality the only buys we get now is with regional agencies. It is business as usual and won't impact small market stations.

As I said in another post. We as in medium and small market stations did this to ourselves. With all of our bartered stuff we run. Why place a buy? It is no longer needed when you get it for free.