Arbitron to Delay Commercialization of the Portable People Meter(TM) Radio Ratings Service in New York, Los Angeles, Chicago, San Francisco and Dallas
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Arbitron Inc. (NYSE: ARB) announced today that it will delay the
commercialization of its Portable People Meter (PPM) radio ratings
service in nine markets. New York, Nassau–Suffolk
and Middlesex–Somerset–Union
will be delayed by nine months; Los Angeles, Riverside and Chicago by
six months; and San Francisco, San Jose and Dallas by three months.
In these nine markets, the Company will extend the use of the paper and
pencil diary system that has been serving the industry since 1965.
During the delay, Arbitron will continue to work with customers, the
Media Rating Council®,
other industry organizations and community groups on the research and
business issues related to the Portable People Meter radio ratings
service in local markets.
"We remain confident in the audience estimates
that the Portable People Meter service is producing. However, over the
past three weeks, feedback from our customers, the Media Rating Council
and other constituencies has led us to conclude that the radio industry
would be better served if we were to delay further commercialization of
the PPM in order to address their issues,”
said Steve Morris, chairman, president and chief executive officer,
Arbitron Inc.
"We already have a number of initiatives in
the pipeline for implementation in the first quarter of 2008 that we
believe will improve the performance of our PPM samples. Our intention
is to expand significantly this list of improvement initiatives by
working closely with customers, industry organizations and community
groups. We expect that the Media Rating Council will be a particularly
valuable source of guidance and advice on the more technically oriented
aspects of this review and improvement process and we intend to work
closely with the members of the MRC over the next several months,”
said Mr. Morris.
"We also plan to use the additional time to
work closely with community leaders to review the workings of the
Portable People Meter service and to gather their insights as to how we
might improve compliance among persons 18-34, including ethnic young
adults, across the diverse communities of New York, Los Angeles, Chicago
and subsequent markets,” said Mr. Morris.
Revised Portable People Meter Rollout Schedule First survey month of "currency”
PPM data for buy/sell transactions
New York
September 2008
December 2007
Nassau-Suffolk
September 2008
December 2007
Middlesex-Somerset-Union
September 2008
December 2007
Los Angeles
September 2008
March 2008
Riverside
September 2008
March 2008
Chicago
September 2008
March 2008
San Francisco
September 2008
June 2008
San Jose
September 2008
June 2008
Dallas
December 2008
September 2008
Arbitron intends to introduce the Portable People Meter service in
Atlanta, Detroit, Washington D.C. and in subsequent markets, as
originally scheduled.
The ratings for the September 2008 PPM survey month (August 21 –
September 17) are scheduled to be delivered to customers on October 8,
2008. The first "currency”
survey month in Los Angeles, Riverside, Chicago, San Francisco and San
Jose will be preceded by two "pre-currency”
monthly PPM reports in July and August. In Dallas, the two "pre-currency”
months will be October and November 2008. The first "currency”
month in Dallas will be the December PPM survey month (November 13 –
December 10) scheduled to be released on December 31, 2008.
New York, Nassau-Suffolk and Middlesex-Somerset-Union "pre-currency”
data will continue to be released through August 2008 but only as
monthly reports for research and evaluation purposes, and not in a
format that can be used by software systems that have a scheduler module
which is used for the buying and selling of radio station advertising.
This decision does not impact the Portable People Meter radio ratings
services currently in operation in Houston and Philadelphia. Monthly and
weekly ratings reports based on the currently installed PPM panels in
these two markets will continue to be issued to radio stations, agencies
and advertisers as scheduled for their use in the buying and selling of
radio station advertising.
Revised Financial Guidance for 2007 and Outlook for 2008
As a result of its decision to delay further implementation of the
Portable People Meter service, the Company is updating its previously
issued guidance to reflect the resultant financial impact. Earnings per
share (diluted) for 2007 are currently estimated to be between $1.30 and
$1.35 as compared to its previously issued earnings per share guidance
of $1.35 to $1.45.
In addition, the Company currently estimates the impact of foregone
revenue and additional costs required to produce diary estimates in the
affected markets will reduce 2008 earnings by $0.22 to $0.33 per share
(diluted). Consistent with past practices, detailed annual revenue and
earnings per share guidance will be provided in conjunction with our
fourth quarter 2007 earnings release expected to be issued in February
2008.
Conference call: schedule and access
Arbitron will host a conference call at 9:00 a.m. ET on Tuesday,
November 27 to discuss the revision to the Portable People Meter rollout
schedule and other relevant matters. To listen to the call, dial (toll
free) 888-694-4641. The conference call can be accessed from outside of
the United States by dialing 973-582-2734. To participate, users will
need to use the following code: 9500497. The call will also be available
live on the Internet at the following sites: www.arbitron.com,
www.ccbn.com and www.streetevents.com.
About Arbitron
Arbitron Inc. (NYSE: ARB) is an international media and marketing
research firm serving the media – radio,
television, cable, online radio and out-of-home –
as well as advertisers and advertising agencies in the United States and
Europe. Arbitron’s core businesses are
measuring network and local market radio audiences across the United
States; surveying the retail, media and product patterns of local market
consumers; and providing application software used for analyzing media
audience and marketing information data. The company has developed the
Portable People Meter, a new technology for media and marketing research.
Arbitron’s marketing and business units are
supported by a world-renowned research and technology organization
located in Columbia, Maryland. Arbitron has approximately 2,100
employees; its executive offices are located in New York City.
Through its Scarborough Research joint venture with The Nielsen Company,
Arbitron provides additional media and marketing research services to
the broadcast television, newspaper and online industries.
Portable People MeterTM and PPMTM
are marks of Arbitron Inc. Media Rating Council® and the "double
checkmark" logo design are registered marks of the Media Rating Council. Arbitron Forward-Looking Statements This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. The
statements regarding Arbitron Inc. and its subsidiaries ("we,” "our,” "Arbitron”
or the "Company”)
in this document that are not historical in nature, particularly those
that utilize terminology such as "may,” "will,” "should,” "likely,” "expects,” "anticipates,” "estimates,” "believes,” or "plans,”
or comparable terminology, are forward-looking statements based on
current expectations about future events, which Arbitron has derived
from information currently available to it. These forward-looking
statements involve known and unknown risks and uncertainties that may
cause our results to be materially different from results implied in
such forward-looking statements. These risks and uncertainties
include, in no particular order, whether we will be able to: successfully implement the rollout of the Portable People Meter
service; renew contracts with large customers as they expire; successfully execute our business strategies, including entering
into potential acquisition, joint-venture or other material
third-party agreements; effectively manage the impact of any further ownership shifts in
the radio and advertising agency industries; respond to rapidly changing technological needs of our customer
base, including creating new proprietary software systems and new
customer products and services that meet these needs in a timely
manner; successfully manage the impact on our business of any economic
downturn generally and in the advertising market in particular; successfully manage the impact on costs of data collection due to
lower respondent cooperation in surveys, privacy concerns, consumer
trends, technology changes and/or government regulations; successfully design, recruit, and maintain PPM panels that
appropriately balance research quality, panel size and operational
cost; successfully develop and implement technology solutions to measure
multi-media and advertising in an increasingly competitive
environment; and successfully obtain and/or maintain Media Rating Council
accreditation for our audience measurement services. Additional important factors known to Arbitron that could cause
actual results to differ materially from our forward-looking statements
are identified and discussed from time to time in Arbitron’s
filings with the Securities and Exchange Commission, including, in
particular, the risk factors discussed under the caption "ITEM
1A. RISK FACTORS” in Arbitron’s
Annual Report on Form 10-K for the year ended December 31, 2006. The forward-looking statements contained in this document speak only
as of the date hereof, and Arbitron undertakes no obligation to correct
or update any forward-looking statements, whether as a result of new
information, future events or otherwise.