A group that might have at least slowed government approval of the proposed Nielsen-Arbitron merger through loud defiance signaled it will not stand in the way. The Association of National Advertisers (ANA) believes the deal could enhance cross-platform measurement for the industry and won’t have any impact on stifling competition in the TV arena.
There’s “no reason to oppose” Nielsen’s $1.26 million acquisition of the company that controls radio measurement, wrote ANA executive Bill Duggan in a Tuesday blog post. He added that the combination offers the prospect that “1 + 1 = 3, as combining technologies and processes may enhance some capabilities that the industry needs.”
Adding Arbitron’s radio data to Nielsen’s sources in TV and other platforms could bring an improved cross-platform system with another important medium melded in, Duggan suggests. Arbitron has made the argument that radio is often cast aside in the cross-platform pursuit and last fall launched a five-platform initiative including it with comScore, backed by ESPN.
With its portable people meter (PPM), Arbitron has launched an out-of-home TV measurement product and tracked TV as part of cross-platform efforts, but Arbitron has given no sign it intends to move heavily into TV measurement. So, the ANA believes combining Arbitron with Nielsen won’t take a potential competitor in TV off the market. (Arbitron had a major role in TV measurement years ago.)
“It’s been a long time and no serious competitor has emerged to Nielsen for television audience currency,” wrote Duggan, a group executive vice president. “So we don’t understand the validity of the ‘lack of competition’ concern raised by some in the industry, particularly as it relates to measurement currency.”
As it reviews the deal, Nielsen would have the Federal Trade Commission (FTC) considering the merger as simply two separate businesses getting married.
As part if its endorsement, the ANA also appears to appreciate the potential for radio measurement to improve globally. Nielsen has suggested it can use its resources to give Arbitron a global presence.
Strident opposition to Nielsen acquiring Arbitron by both the ANA and sister trade group the 4As could have an impact on how the FTC moves ahead. But, the ANA apparently won’t offer it – potentially disappointing media buying entities and others concerned Nielsen already has become too powerful.
The 4As, which represents those buying entities, could mount a vigorous fight. It’s said it “will continue to monitor the situation as more information becomes available, and, if necessary, will act to prevent adverse consequences” for its members, agency clients and the industry at wide.
The FTC does not make any information regarding communication with interested parties public. That would cover point-of-view letters from the likes of the ANA, 4As, agency holding companies, network groups or others in favor or in opposition.
The ANA’s support for the Nielsen-Arbitron combination, articulated by Duggan, does not come without some caveats. He notes what may have most in the ad industry ecosystem concerned: the dominant player in TV measurement – some use the term “monopoly” -- could simply get more powerful. That could offer less incentive for Nielsen to innovate, while giving it an opportunity to raise prices.
“Nielsen has had a long-standing reputation for sometimes moving too slowly,” the ANA’s Duggan wrote. “This acquisition would now significantly consolidate media measurement power into one single provider and we would hope that would not delay forward movement.”
A survey among ANA members yielded some concern that the deal would create “even more of a monopoly” for Nielsen, bringing “pricing concerns.”
Even before the ANA offered its endorsement, the odds seemed greatly in favor of the FTC ultimately giving the deal its blessing. Still, the FTC could extract some commitments from Nielsen to ensure it doesn’t use any newfound scale in a potentially harmful fashion.
Whether some provisions are attached to how Nielsen operates in the market looks to be one of the most interesting questions about the deal moving ahead. The ANA could play an influential role there in protecting its members’ interests. But would it have more credibility if it had not already offered up support for the deal?