IS RADIO'S SIGNAL GETTING STRONGER? Peter Kafka – Forbes The radio business, supposedly a victim of technological advances and consumer apathy, may have more life in it yet.
That's the message delivered today by radio ratings firm Arbitron, which says Marconi's medium has more listeners than previously thought--it just hasn't been measuring them accurately.
And while that might seem like an odd admission coming from a company with a near monopoly on the radio ratings business in the U.S., it's not as counterintuitive as it sounds. Arbitron says it has a new measurement system that will solve that problem for broadcasters.
The company is testing its Portable People Meters, electronic devices that automatically record what listeners are tuning into, as opposed to its current system, which asks listeners to remember what they hear all day and then jot it down in a diary.
Arbitron officials said today that preliminary results from a test of the new system in Houston indicate that, while the average listener spends less time with the radio than previously estimated, there are more listeners who are listening to more stations.
The survey, which sampled more than 2,000 Houston-area listeners this summer, shows that the average person heard about ten hours and 45 minutes of radio per week, down from previous estimates of 15 hours and 15 minutes per week. But there are more listeners--more than 93% of the population, as opposed to 86% in earlier estimates--and they listen to twice as many stations as previously reported, according to Pierre Bouvard, who is overseeing Arbitron's People Meter project.
Even the drop in time spent listening may not be as dramatic as it sounds, he said, arguing that much of the previous estimate was inflated by a small group of listeners who reported--most incorrectly--that they spent the entire day listening to the radio.
All of this means that the radio market should be able to attract more advertising dollars than it has, Arbitron officials said. That is welcome news for the industry, which has seen ad revenue flatten in recent years, as marketers concluded that audiences were bailing out, either because they were bored with radio's offerings or were more interested in other entertainment options, like Apple's iPod or satellite radio options, such as Sirius or XM.
Arbitron's new and improved statistics weren't limited to a specific demographic or programming genre, it said. Instead, listening was up across the board.
There is likely some truth to Arbitron's argument, says John Rash, who oversees radio buying for ad agency Campbell Mithun. "Accurate measurement will always entice advertisers, because it's important to know what they're getting for what they're paying." he said. "Better measurement, coupled with better negotiating tools, should increase advertiser interest in the media form."
Arbitron released its new numbers in advance of a National Association of Broadcasters convention that begins Wednesday. The results are similar to a test Arbitron conducted in Philadelphia in 2002; it says it repeated the market test in Houston, in part because it wanted to make sure the measurement system would work in markets with significant Hispanic populations.
One demographic problem the company says it hasn't solved is how to get listeners in their late teens and early 20s to participate in the surveys. Arbitron says listeners age 18 to 24 were less likely to use the people meters than any other age group.
Still, Bouvard said Arbitron would be ready to start selling the people meters in 2006, starting with Houston and Philadelphia, and then could move on to larger markets.
That may still not be fast enough for radio giant Clear Channel Communications, which has been publicly agitating for Arbitron to speed up delivery of a new measurement system. Earlier this year, Clear Channel invited other companies to gin up their own proposals for alternate measurement systems and has set a deadline of Dec. 15 for submissions. Clear Channel officials were not available for comment. |