Arbitron readies new measurement tools

Ratings firm adds office space, plans to hire 120 this year

Howard Bussiness

April 16, 2001|By TaNoah Morgan | TaNoah Morgan,SUN STAFF

As one of the nation's leading marketing and media research firms begins to trade its stock on the New York Stock Exchange, it is also expanding its Howard County presence into the Gateway office park.

Arbitron Inc., best known for its measurement of local radio ratings, has moved into a 20,000- square-foot office on Alexander Bell Drive. The company also has a two-building campus off Snowden River Parkway. The expansion was precipitated by the March 30 reverse spinoff from its parent company Ceridian Corp. and expected growth in two new product areas, company executives said.

The company's stock opened at $23.60 a share April 2, its first day of trading, and closed at $22.40 last week.

Along with its radio statistics, the research firm is delving into Internet and television media with Webcast ratings measuring Web broadcasting audiences, and the Portable People Meter (PPM), a device that can help measure demographics of any broadcast medium.

"If you're looking for growth, there are two things on either side of our core business," Marshall Snyder, Arbitron president of development for the PPM, said, referring to the new audience-measurement products. "We're going to increase the definition of multimedia."

Company executives say they decided to expand office space to make room for an expected 120 hires this year. About 60 people have moved to the new facility in the company's first expansion since 1985.

Part of the growth is expected to come in information technology jobs and other support positions for the company's new ratings systems.

Although its headquarters is in New York, Arbitron employs more than 700 people in Howard County to solicit nationally for participation in surveys, collect data, process the information and research what it means for stations and their advertisers. The company will need more workers as it commercializes its new ratings products.

The PPM is a decoder the size of a pager that tracks signals encoded in radio, television and Internet broadcasts. It can help the company determine what kinds of advertising and programming people are exposed to, and for how long. By collecting detailed data on the people carrying the decoder, the company can rate how much of any broadcast medium an average person of any ethnicity, income or location listens to.

The PPM is being used in trials in Wilmington, Del., and the company plans to extend trials to greater Philadelphia next year, Snyder said. The plan calls for the company to survey hundreds of thousands of people across the top 100 television and radio markets, he said. Arbitron has agreements with Neilsen Media Research, best known for its measurement of television audiences, to help deploy the pager-style devices.

"People will put money where there's information," Snyder said. "The better the information, the more marketing people will invest."

Webcast ratings are a new initiative to measure audiences of Web-based broadcasts. Like the Nielsen ratings, the Webcast ratings program measures how many computers are tuned in to a particular Web broadcast. Used in conjunction with the PPM, Arbitron could also track what types of people tune in to various broadcasts. "That becomes a very valuable set of insights," Snyder said.

As Arbitron began trading under its own name at the end of last month, analysts were excited about prospects for the company's growth. One analyst said Arbitron has only begun to mine the potential of its radio analysis because the company concentrates only on the top markets.

"They are far from having exhausted their franchise," said Christopher Schulz, an analyst with the Spin-Off Report, a publication of the Horizon Research Group of New York. "One can expect as a company becomes a standalone, it can use the cash flow for itself. They can use it to expand the market, which I see is the biggest opportunity for them."

Schulz said the company's new ratings systems, especially the PPM, are tools that will help deepen their hold of the market.

"No one has produced anything better," he said, adding that the former method of keeping track of media exposure, taking notes in a diary, had become "a pain in the neck" for participants.

"There has to be a better way and PPM is one of those ways," he said.

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