Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Proposed settlement alleviates FTC’s concerns regarding proposed combination of ratings services, (Sep 23, 2013)

By Jody Coultas, J.D.

FTC antitrust concerns over Nielsen Holdings N.V.’s proposed $1.26 billion acquisition of Arbitron Inc. would be resolved under the terms of a proposed consent order (In the Matter of Nielsen Holdings N.V., FTC File No. 131 0058).

The FTC filed the antitrust claims against media research company Nielsen based on its proposed acquisition of Arbitron. Arbitron sells audience measurement services, including radio and cross-platform, to content providers, advertising agencies, and advertisers. Nielsen and Arbitron have both been developing national syndicated cross-platform audience measurement services, which allow audiences to be measured accurately across multiple platforms, such as TV and online. As television viewership moves to mobile devices, tablets, and personal computers, traditional viewership measurements only capture some of the total viewing audience. Thus, media companies and advertisers are seeking measurement services that account for the entire audience.

The FTC alleged that the acquisition would substantially lessen competition and create a monopoly in the market for national syndicated cross-platform audience measurement services. Nielsen and Arbitron are the only two companies that operate large and demographically representative panels capable of reporting television programming viewership and have the ability to offer cross-platform measurements. The FTC alleged that Nielsen and Arbitron’s syndicated cross-platform measurement services would compete directly. Thus, the acquisition would defeat competition.

Chairwoman Edith Ramirez and Commissioner Julie Brill issued a statement in support of the FTC’s acceptance of the proposed consent order, noting that the agreement was tailored to counteract the likely anticompetitive effects of the proposed acquisition while leaving intact any benefits that may be gained from the acquisition. The statement noted that the measurement services were likely to have relatively modest sales for some time. The proposed settlement served the public interest by allowing the transaction to proceed while remedying the competitive concerns.

In a dissenting statement, Commissioner Joshua D. Wright stated his believe that there was insufficient evidence that Nielsen’s acquisition would substantially lessen competition in the future market for national syndicated cross-platform audience measurement services. Nielsen and Arbitron do not currently compete in the sale of national syndicated cross-platform audience measurement services because there is no commercially available national syndicated cross-platform audience measurement service today. Therefore, the Commission did not know whether the parties could or would develop a cross-platform product for the relevant market absent the merger. The Commission also could not know how the market would evolve, what other potential competitors might exist, and whether and to what extent these competitors might impose competitive constraints upon the parties. Even assuming these issues, Wright felt the evidence suggested that any anticompetitive effects arising from the transaction would be relatively small. The proposed settlement agreement would shift the Commission’s mission from that of antitrust enforcer to a much broader mandate of “fixing” a variety of perceived economic welfare-reducing arrangements. Wright stated that the Commission should close the investigation and allow the parties to complete the merger without imposing a remedy.

The proposed order required 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. The acquirer will get everything it needs to replicate Arbitron’s participation in a national syndicated cross-platform audience measurement service. The order required that Nielsen provide technical assistance and remove barriers that might otherwise keep the acquirer from hiring key Arbitron employees.

News: Antitrust FederalTradeCommissionNews