Source : Globe & Mail

VANCOUVER -- Canada's radio industry faces a crucial decision in the next few months, having to decide whether it should spend millions on a new system of tabulating ratings to appease advertisers who say the old method lacks credibility.

BBM Nielsen Media Research, which compiles ratings for stations across the country, wants the industry to contribute as much as $8.5-million to introduce digital audience tracking in radio.

Currently, ratings are assembled in Canada by sending out paper diaries to listeners who volunteer to write down their radio habits over the course of the week.

That system, which is used to determine what radio stations charge for commercial time, is decried by the advertising industry as potentially inaccurate and unreliable. The stakes are also high for radio stations since a variance of a few percentage points in the ratings can be worth up to $1-million in the largest markets.

Ad buyers need listener data faster to determine which stations will get the bulk of their clients' dollars, BBM Nielsen chief executive officer Jim MacLeod told broadcasters in Vancouver yesterday. "Nobody seriously believes that diaries can deliver that," Mr. MacLeod said at the annual Canadian Association of Broadcasters conference.

BBM Nielsen wants to replace the clunky diary system with high-tech pagers that selected listeners carry around with them. The gadgets track radio signals on their own, right down to the minute each station is played. The idea has been talked about in Canada for more than two years, but BBM Nielsen wants to have it operating in early 2007. The strategy would bring radio in line with television ratings, which are tracked through electronic boxes and, in some markets, by using the pager technology.

Cost is the biggest hurdle, though. Broadcasters foot most of the bill for the ratings agency, while advertisers contribute about 10 per cent. Major broadcast players such as Corus Entertainment and Rogers Communications are in favour of switching to the new system, but the industry will now have to get all of its players onside. Smaller broadcasters could be hard to convince as the technology will only be used in bigger Canadian cities and requires millions to put in place.

However, a study of the pager devices in U.S. markets presented yesterday at the conference indicates advertisers increase their spending if they have more confidence in ratings data. Using numbers from the U.S. study, BBM Nielsen estimates the new pagers could boost ad spending on Canadian radio by as much as $36-million a year.

Advertisers, meanwhile, are in favour of the idea, since it will allow them to track audience data faster.

TV can tabulate ratings daily, whereas radio takes months.

"We have to be able to [access] the data fast and move quickly on it," said Doug Checkeris, head of Media Company, a Toronto firm that buys advertising space.

Should the radio industry decide in the coming months to spend the money on the new ratings system, the pagers would be introduced in five cities in 2007, starting with Montreal, Toronto, Vancouver, Calgary and Edmonton. The gadgets have been experimented with in Montreal for more than a year.

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