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Arbitron Measurement: TAM or SCAM?

The following was written by Triton Media COO Mike Agovino and is reposted here with his permission.  I think Mike is completely right, so I wanted to share this with you.

There’s a lot of noise in the marketplace about Arbitron launching a new “Total Audience Measurement” product and that product being endorsed in advance by some broadcasters.

Where to begin?

How about here: the radio industry should be outraged.

As you all are aware, Triton also owns a measurement product, MRC-accredited Webcast Metrics. How much revenue do we realize from this industry-sanctioned product? Less than 1/10th of 1% of what Arbitron does annually. Arbitron estimates its 2011 revenue to be some $424 Million. That’s about 2.5% of radio’s total revenue. To put this in perspective, Comscore takes less than .7% of the revenue from its space and back in 2006, radio’s all-time high revenue year, Arbitron took about 1.5% of industry revenue. As times have gotten tougher for the industry, the wallets have gotten fatter at Arbitron.

In plain terms, Triton charges what is fair and reasonable for metrics in the developing marketplace of online audio. I don’t begrudge Arbitron for getting what they can. I begrudge them for diverting funds from the future to prop up the past. Give some of that $424 million back to publishers who want to push forward but can only go so fast with the resources they have. I can tell you for certain that a big chunk of change rebated to the broadcasters would enable a significant amount of resourcing to be put against unique and local online content creation. That’s what this industry needs.

The industry is mining “fool’s gold” if it buys into the thought that a combined audience number is important. These are different worlds and need to be addressed separately. Wouldn’t it be better for everyone if the marketplace for online audio flourished out of the digital side? Moving forward a digital audio impression can do everything a display impression can do and more. The audio impression is integrated into the content flow and the consumer hears just one message at a time as opposed to multiple display ads around the borders of a content page that are seldom viewed or clicked. This is the future, this is where things are headed.

We are helping the industry to chart a new course and build new models with the benefit of technology. This has been our belief and vision at Triton since the day we founded the company. Online audio is a digital medium. It needs to be sold like digital media. Arbitron adds absolutely nothing to that conversation. It’s a smokescreen diverting Radio from the real issues at hand. The idea of total audience measurement is nothing more than a selfish revenue growth strategy from a glutton that is already taking enormous fees out of the radio industry. Arbitron revenue is projected to be up by over 7% this year, how does that compare to how radio is doing? Radio should push back from the table and tell Arbitron they won’t support their latest efforts to strengthen their monopoly.

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