Arbitron & the Tornado

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Four months after tornadoes ripped through Alabama, killing hundreds of people and destroying thousands of buildings, radio industry executives say the storm cost them millions of dollars in advertising revenue. And some say the decision of one company may make problems worse. WBHM’s Tanya Ott reports.

Most days, Birmingham’s 95.7 JAMZ is plays hip hop and rhythm and blues. But in the days after the tornado, it was wall-to-wall news.

“Immediately after the storm I called to say I have grave reservations.”

That’s David Dubose, the head of Cox Media Group in Birmingham. The company he called was Arbitron. It’s like the Nielson’s of radio. Arbitron mails out diaries for people to record what stations they listen to.

“When the tornado hit you had some diaries that were in the field, so imagine, are you going to fill out your diary or are you going to worry about dealing with debris in your yard or the hole in your roof?”

Sure enough, JAMZ dropped from its long-held #1 spot in the market to #5. Dubose is demanding Arbitron dump the ratings for the period when the tornado hit. But Arbitron’s Vice President of Research Beth Webb says no way.

“A few days of disruption isn’t going to disrupt the entire service if things get back to normal.”

She says things did get back to normal. The company collected enough diaries. Webb says a blip for one station doesn’t warrant canceling the ratings for the entire Birmingham area.

Industry execs say this rumble over ratings points to a larger problem: Arbitron is a monopoly. If it wants to dig in its feet on any issue, there’s not much radio stations can do about it.

“It’s not some sort of nefarious plot.”

Peter Dominowski is with Market Trends Research. He says other companies have tried competing against Arbitron, but didn’t last because the business is highly-specialized and expensive. Observers note until another company gets in the radio ratings business there are bound to be more disputes.