FTC Puts Conditions on Nielsen’s Proposed $1.26 billion Acquisition of Arbitron

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Media research company Nielsen Holdings N.V. has agreed to settle Federal Trade Commission charges that its proposed acquisition of Arbitron Inc. may substantially lessen competition.  Nielsen will divest and license assets and intellectual property needed to develop national syndicated cross-platform audience measurement services.

Nielsen and Arbitron are developing national syndicated cross-platform audience measurement services, which allow audiences to be measured accurately across multiple platforms, such as TV and online.  According to the FTC’s complaint, the elimination of future competition between Nielsen and Arbitron would likely cause advertisers, ad agencies, and programmers to pay more for national syndicated cross-platform audience measurement services.

“Effective merger enforcement requires that we look carefully at likely competitive effects that may be just around the corner,” said FTC Chairwoman Edith Ramirez.  “In this matter, the evidence provided us with a strong reason to believe that absent a remedy, the deal was likely to harm emerging competition in the area of cross-platform audience measurement.”   

The proposed order settling the FTC’s complaint is designed to address the competitive concerns raised by Nielsen’s acquisition of Arbitron.  It requires Nielsen to sell and license, for at least eight years, certain assets related to Arbitron’s cross-platform audience measurement services to an FTC-approved buyer, within three months.  Under the order, the acquirer will get everything it needs to replicate Arbitron’s participation in a national syndicated cross-platform audience measurement service.  The order also contains terms designed to ensure the success of the acquirer as a viable competitor, such as requiring that Nielsen provide technical assistance and remove barriers that might otherwise keep the acquirer from hiring key Arbitron employees. 

Without the assets Nielsen is required to provide under the order, according to the FTC, it is unlikely another company would be able to successfully develop a service to compete with Nielsen’s future national syndicated cross-platform audience measurement service.

Nielsen, headquartered in New York, New York, and Diemen, the Netherlands, is a leading provider of global media measurement and research services. In the United States, it provides television, online, mobile, and cross-platform audience measuring services to media companies, advertisers, and advertising agencies.  As the dominant provider of television audience measurement services in the United States, Nielsen had global sales of $5.6 billion in 2012.

Arbitron, headquartered in Columbia, Maryland, is a leading media measurement and research firm. Its leading product is its radio ratings service, which estimate the size of listening audiences by demographic category, and is used by radio broadcasters and advertisers to determine the value of radio advertising.  In 2012, it had revenue of $449 million.  Under a merger plan dated December 17, 2012, Nielsen proposes to acquire Arbitron for approximately $1.26 billion.

The Commission vote to accept the consent agreement containing the proposed consent order for public comment was 2-1, with the Commission issuing a statement and Commissioner Joshua D. Wright issuing a separate dissenting statement. Commissioner Maureen Ohlhausen was recused from participating in this matter. 

The FTC will publish a description of the consent agreement package in the Federal Register shortly.  The agreement will be subject to public comment for 30 days, beginning today and continuing through October 21, 2013, after which the Commission will decide whether to make the proposed consent order final.  Interested parties can submit written comments electronically or in paper form by following the instructions in the “Invitation To Comment” part of the “Supplementary Information” section.

Comments in paper form should be mailed or delivered to:  Federal Trade Commission, Office of the Secretary, Room H-113, 600 Pennsylvania Avenue, N.W., Washington, DC 20580.  The FTC is requesting that any comment filed in paper form near the end of the public comment period be sent by courier or overnight service, if possible, because U.S. postal mail in the Washington area and at the Commission is subject to delay due to heightened security precautions.  Comments also can be filed electronically.

NOTE:  The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest.  When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions.  Each violation of such an order may result in a civil penalty of up to $16,000.

The FTC’s Bureau of Competition works with the Bureau of Economics to investigate alleged anticompetitive business practices and, when appropriate, recommends that the Commission take law enforcement action.  To inform the Bureau about particular business practices, call 202-326-3300, send an e-mail to antitrust{at}ftc{dot}gov, or write to the Office of Policy and Coordination, Bureau of Competition, Federal Trade Commission, 601 New Jersey Ave., N.W., Room 7117, Washington, DC 20001.  To learn more about the Bureau of Competition, read Competition Counts. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.