Arbitron

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Arbitron Inc.

Type	Public NYSE: ARB
Founded	Washington, D.C. (1949)
Headquarters	Columbia, Maryland
Area served	United States
Key people	Michael Skarzynski CEO
Industry	Media Market (Research)
Products	Ratings Data
Revenue	$368.82 million[1]
Net income	$37.22 million[2]
Employees	1,116[3]
Website	www.arbitron.com

Arbitron (NYSE: ARB) is a radio audience research company in the United States which collects listener data on radio audiences similar to that collected by Nielsen Media Research on television audiences. It was founded as American Research Bureau by Jim Seiler in 1949 and became bi-coastal by merging with L.A. based Coffin, Cooper and Clay in the early 1950s. ARB's initial business was the collection of television broadcast ratings exclusively.

ARB changed its name to Arbitron in the mid 1960s. The name came from the Arbitron System that was one of ARB's products; a central statistical computer with leased lines to viewers' homes to monitor their activity. Deployed in New York, it gave instant ratings data on what people were watching. A reporting board would light up to indicate what home was listening to what broadcast.

Methods

Survey

Arbitron collects data by selecting a random sample of a population in roughly 100 metros throughout the United States four times a year. An additional 200 markets are surveyed in the Spring and Fall. People in the sample are asked to maintain a written diary describing each radio program listened to. Each selected household agreeing to participate is provided a diary for each member aged 12 and older for one week, beginning on Thursday and ending the following Wednesday. At the end of the week, the completed diaries are returned to Arbitron by post.

A new random sample is selected to participate each week. Arbitron's surveys are broken down into four key ratings periods, roughly corresponding with the seasons and bearing their names.^[4] The term commonly used in the radio industry for these quarterly ratings is Arbitron book, or more specifically, the Spring book, Fall book, etc. Arbitron also releases monthly information twice between the release of each book. These ratings, called Arbitrends are labeled Phase I and Phase II. The Arbitrends, despite being mid-term indicators, reflect the entire three-month block leading up to them.^[5] Arbitron surveys listener habits from six a.m. to midnight from Monday through Sunday^{[citation needed]}, 48 weeks per year. There is given a one week break following the Spring book, and an additional three weeks break following Fall book.^[6] Turnaround time for release of data from the end of the survey period is approximately three weeks.

After collection, the data is marketed to radio broadcasters, radio networks, cable companies, advertisers, advertising agencies, out-of-home advertising companies and the online radio industry.^[7] Major ratings products include cume (the cumulative number of unique listeners over a period), average quarter hour (AQH - the average number of people listening every 15 minutes), time spent listening, (TSL), and market breakdowns by demographic. Its important to understand that the CUME only counts a listener once, whereas the AQH can count the same person multiple times, this is how to determine the TSL. For example, if you looked into a room and saw Fred and Jane, then 15 minutes later saw Fred with Sara. The Cume would be 3 (Fred, Jane, Sara) and the AQH would be 2. (an average of two people in the room in a given 15 minute period)

The seasonal books' 12+ ratings, a measurement of the overall number of people 12 and over listening to a particular station, are available as a free service for noncommercial use in most markets, except in cases where radio companies request an embargo. More detailed data, such as demographics and Arbitrends, are available only by paid subscription.

This system is widely considered by the radio industry to be imperfect and grossly flawed. Arbitron mails out the surveys, but the X factor is getting the listeners to return them. The survey can be skewed based on what neighborhoods receive them. For instance, a Hip-Hop radio station might win the "book" if the surveys are mailed out to younger, urban residences. Arbitron can, in theory, mail out 1000 surveys, but if only 30 are returned, they will grant their findings based on those 30 received surveys. Radio ratings and advertising rates are based on the ARB findings, which makes the impact of this imperfect system much more grand than a station claiming "We are #1!".

Portable People Meter

With the interest in the collection of more accurate ratings data, Arbitron has introduced the Portable People Meter (PPM). The PPM is a wearable portable device much like a pager or cell phone, that electronically gathers inaudible codes that identify the source of a broadcast, such as a radio station. Arbitron recruits and compensates a cross section of consumers to wear the meters for about a year. The audience estimates generated from each monthly survey is used as the buy/sell currency for radio stations and advertisers/agencies. The PPM is the currency in Houston, Philadelphia, New York, Detroit, Nassau-Suffolk (Long Island), Middlesex-Somerset-Union, Chicago, Los Angeles, Riverside-San Bernardino, San Francisco and San Jose. By 2010, 50 markets will be measured using the PPM. [1] In 2006, Arbitron sued competitors International Demographics and IPSOS concerning 3 patents related to technology used by the Portable People Meter.^[8]

Financial Performance

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Top 10 of the Market Research Sector 2006

See also

• Nielsen Ratings (for television programs)
• Time spent listening, one of the metrics measured
• List of United States radio markets
• Radio & Records, periodical which publishes Arbitron data for commercial stations
• Radio Research Consortium, non-profit corporation which publishes Arbitron data for non-commercial stations
• The Media Audit, a similar company with different methodology.

References

External links

• Arbitron Official website
• Ratings - Persons 12+ from Arbitron for commercial stations
• Ratings - Persons 12+ from FMQB for commercial stations
• Ratings - Persons 12+ from Radio and Records for commercial stations
• List of U.S. Radio Markets (ranked by size)
• Nationwide Radio Reference Guide
• DFWRadioArchives - contains historical Arbitron ratings data for Dallas/Fort Worth, TX
• Audio interview of Ernest H. Clay, ARB's Research and Production Director on WGN's discussion show Your Right To Say It