Nielsen/Arbitron Deal Sparks Concerns Over Competition, Supply Of Ad Market 'Currencies'

Nielsen’s $1.26 billion deal to acquire Arbitron would make the world’s largest supplier of media and marketing research even bigger, giving it not just greater dominance over another medium, but yet another one of Madison Avenue’s so-called market “currencies,” and constricting the supply chain of media ratings that advertisers and agencies use as the basis of hundreds of billions of dollars’ worth of media buys.

The timing of the deal is ironic, coming nearly two decades after Dec. 31, 1993, when Arbitron officially shut down its television ratings business -- making Nielsen the de facto monopoly supplier of television ratings, and putting it in a position to dominate the rest of the advertising food chain for decades to come. The deal also comes as Nielsen executives claim to have reached the “tipping point” for becoming the ad industry’s trading currency for another key medium -- online -- following an especially rapid and aggressive push to make its Nielsen Online Campaign Ratings service Madison Avenue’s standard for Internet advertising, including essentially giving the service away for free to some of its biggest customers until it achieves a critical mass of penetration among big online advertisers. In other words, if regulators approve Nielsen’s acquisition of Arbitron, the consolidated company will not simply be a supplier of media audience estimates and consumer marketing insights, but will be the sole supplier of advertising trading currency for three major media: TV, online and radio. "It makes Nielsen the currency for $85 billion in advertising -- $68 billion for TV and $17 billion for radio,” Brad Adgate, senior vice president-director of research at Horizon Media, estimates of just the TV and radio portion of Nielsen’s market position.