Good day, ladies and gentlemen, and welcome to the comScore Fourth Quarter 2012 Earnings Conference Call. My name is Keith, and I'll be your operator for today. [Operator Instructions] As a reminder, today's conference is being recorded for replay purposes. And the first speaker today will be Mr. Ken Tarpey, Chief Financial Officer. Please go ahead, sir.

Good afternoon. Thank you very much. Welcome to comScore's Earnings Call for the Fourth Quarter and the Full Year of 2012. Again, I'm Ken Tarpey, CFO of comScore. With me today is Magid Abraham, our President, CEO and Co-Founder; also with us today are Cam Meierhoefer, our Chief Operating Officer; and Serge Matta, our President of Commercial Solutions, will be available during the question-and-answer period. Before we begin, please allow me to read the following disclaimer regarding our use of forward-looking information and non-GAAP financial measures. During the course of today's call, as well as during any question-and-answer periods that may follow, representatives of the company may make forward-looking statements within the meaning of the Security Act of 1933 and the Securities Exchange Act of 1934 regarding future events or performance of the company that involve risks and uncertainties, including, without limitation, the strength of comScore's business; expectations as to opportunities, including new customers and markets for comScore; expectations as to the growth and composition of comScore's customer base and renewal rates; expectations regarding the impact and benefits of particular lines of business and products; expectations regarding the relative quality of comScore's products; assumptions regarding tax rates and net operating loss carryforwards; and forecasts of future financial performance for the first quarter and full year of 2013, including related growth rates, exchange rates and assumptions. Such statements are only predictions based on management's current expectations. Actual events or results could differ materially from those predictions due to a number of risks and uncertainties, including those identified in the documents comScore files from time to time with the Securities and Exchange Commission. Those documents specifically include, but are not limited to, comScore's Form 8-K filed earlier today relating to this call; comScore's Form 10-K for the period ending December 31, 2011, and comScore's Form 10-Q for the period ending September 30, 2012. We caution you not to place undue reliance on any forward-looking statements included in these presentations, which speak only as of today. We do not undertake any obligation to publicly update any forward-looking statements to reflect new information after today's call, or to reflect the occurrence of unanticipated events. In addition we may also reference certain non-GAAP financial measures in the course of our presentation. You will find in our press release and on our Investor Section's website a reconciliation of non-GAAP financial measures discussed during today's call to the most directly comparable GAAP financial measure. The link to our investors section of our website is ir.comscore.com. And our results are posted under press releases. With that, I will now turn the call over to Magid.

Thank you, Ken, and thank you all for joining our earnings conference call for the fourth quarter of 2012. We have some slides that accompany our comments and it might be helpful to follow them. I'll first provide some highlights for the quarter of the year and then Ken will provide more detail on our financial performance. Look, there is no question that 2012 was a tough year, but I am happy to report that we ended the year on a strong note. I'm happy with Q4 results. I'm also excited about the progress we're making in our transformation strategy from a pure measurement company to a realtime analytics company. As you see on Slide 5, revenues reached a record of $68.4 million in the fourth quarter, and Q4 revenue growth -- rather, to a year ago was 9% on a reported basis and 12% on a pro forma basis. Pro forma revenue is adjusted for the non-health portion of our offline copy testing business and the elimination of a former Nexius application called Configuration Manager, that we will discuss a little bit later. Adjusted EBITDA came in at $12.2 million, representing an adjusted EBITDA margin of 18%. During our last earnings call, we provided a measure of trailing 12 months bookings as we believed that bookings growth at this stage of comScore's evolution can provide a better sense of our overall business momentum. As such, we plan to continue to provide this metric for this quarter and during 2013. Trailing 12 months booking grew by 15% in the fourth quarter on a reported basis, as Slide 6 shows, and they grew by 19% on a pro forma basis. On the other hand, the pro forma revenue growth in the fourth quarter was 12% and -- for the fourth quarter…

Thank you, Magid. Reported revenue for the fourth quarter was $68.4 million, up 9% year-over-year. On a non-GAAP pro forma basis, excluding the financial performance of our non-health copy testing and Configuration Manager products, which Magid mentioned earlier, which we expect to divest or eliminate, revenue grew 12%. Subscription revenue in the fourth quarter was a quarterly record of $58.4 million, up 12% year-over-year. Subscription revenue represents 85% of total revenue, a consistent trend. Project revenue was $10 million or 15% of revenue, also consistent with prior trends. GAAP revenue from existing customers was up 8% year-over-year in the fourth quarter to $60.4 million, and represented 88% of total revenues. On the pro forma basis, existing customer revenue in the fourth quarter of 2012 was up 10% year-over-year. Our renewal rate with existing customers remained above 90% on a constant dollar basis, and we added 45 net new customers in the fourth quarter, with our customer count now totaling 2,159. Our focus on international expansion continues to drive an increase in International revenues. In the fourth quarter, revenue from outside the United States was $20.5 million or 30% of revenue, and was up 20% year-over-year. Our top 10 customers represent 21% of revenue in the fourth quarter, reflecting the continued diversification in our overall customer base. Now let me turn to expenses and margins. Our gross margin was 65.4%, down slightly as we strategically invest to support our expanding multi-platform and cross media sales initiatives. As we expand our cross sell and upsell efforts with these products, we expect the resulting operating leverage will drive improvement in our gross margin throughout 2013. In preparing for 2013, we have streamlined processes and identified service offerings for disposition or deemphasis. We also looked to other cost areas for expense optimization opportunities. These…

[Operator Instructions] And your first question is from the line of Jason Helfstein with Oppenheimer. Jason S. Helfstein - Oppenheimer & Co. Inc., Research Division: So a few questions. So, first, I mean, in the Slide 8, you talked about Media Metrix growing 17%. You talked about strong momentum in advertising analytics. Basically, what's the delta between those robust numbers and then the -- effectively the pro forma growth that you actually are reporting on a consolidated basis? I guess what other products are offsetting that strain? Then my second question -- I noticed on the Facebook earnings call, they cited comScore numerous times where, basically, the first time I recall them doing that they usually cite Nielsen. So it would seem that there is a change in the relationship there. If you can go into more detail. And then what that means for you both with Facebook and then potentially with all other companies out there who want to buy social data. And then last question, there's obviously a big push right now in the industry towards algorithm buying, realtime bidding. In those cases, you don't have people using effectively data to make decisions. How do you think that impacts comScore and kind of may change your position positive or minus in the whole ecosystem?

Thanks, Jason. On your first question, a couple of things. Number one, there are some businesses and verticals that experience a slowdown or decline slightly in 2012 like retail, and some survey activities. But the primary reason for the differential between the 13% -- 13% revenue pro forma growth and the 19% revenue bookings growth, that's a 6 percentage point difference. And the primary difference -- I mean, this is really contributed primarily by this new product activity that we are experiencing. When we -- I mean, these new products are now contributing 21%, 22% of bookings, but not nearly as much, almost half as much on revenue. And so as a result, we have that -- we have that differential. As far as Facebook is concerned, Facebook is a great customer. They have become 1 of our -- 1 of our 5 -- top 5 customers, and I believe we have been designated as their principal or official measurement source that they use on a worldwide basis. And that's probably reflected in what you heard in the earnings call. So the relationship with Facebook is growing. We're happy with it, and we expect to deepen it over time. Finally in terms of the push -- the push for realtime buying or RTB, while it is true that some of that buying does not require preplanning -- preplanning data, the -- we have 2 products in our kind of mission -- new mission of realtime analytics, vCE and DAx, that allow somebody to essentially make a decision on the fly on which cookie to bid on and how much to bid, which impression to bid on and how much to bid based on the information that is currently available. I think I answered all 3 questions. Anything I missed? Jason S. Helfstein - Oppenheimer & Co. Inc., Research Division: No. You got it.

Your next question is from the line of Youssef Squali with Cantor Fitzgerald. Youssef H. Squali - Cantor Fitzgerald & Co., Research Division: A couple of questions, please. I guess starting with, maybe, Ken. I'm looking at Slide #15. The non-GAAP pro forma guidance, where you've stripped out the adjustment to exclude the non-health copy testing and the other business for 2012 versus projected or forecast for 2013. I was wondering if you can actually give us that number for 2011 as well? So what's the equivalent of that $8.3 million, which those discontinued or soon to be discontinued businesses contributed in 2011 just for us to see kind of their acceleration -- that deceleration on the core. And then I guess staying with Ken, what's driving that increase in the share count from Q4 to Q1 and then into 2013? I think it's going from 33.7 to 37.3. That's a pretty big increase.

Okay. Sure. So the first part, if I could, in terms of the impact of these businesses and I think this really gets to the heart of why we're moving beyond these products. You're right. It's about $8.3 million of revenue from those products in 2012. But it was a little bit over $14 million of revenue in 2011. And as we've discussed previously, we had these products, which were really just not heading in the right direction, number one. Number two, tended to be choppy and more difficult to predict. And lastly, really, we're not just strategic with the other new offerings that we have from the first part. I think from the second part in terms of the share count, there are share grants that are done in the beginning of the year, first quarter of the year, which account for some of the increase. The second part is I think you just have the averaging impact over the course of the year on the share count are the 2 differences. No new -- nothing new or different in terms of trending than in the past. Youssef H. Squali - Cantor Fitzgerald & Co., Research Division: What's the aggregate number of share grants?

I'll have to get back -- we'll dig that out for you.

We'll dig it up for you. Youssef H. Squali - Cantor Fitzgerald & Co., Research Division: Okay. Not a problem. And then maybe, Magid, just one quick question. Can you maybe update us on the MMX multi-platform beta process, how is that going and when do we go live?

Well, actually, we are calling Media Metrix multi-platform as a beta. But it is really open for all customers. The term beta is -- it's now common for software companies to put things in beta for a long time to manage expectations in terms of any kind of glitches or whatever. But from a business standpoint, multi-platform is off to a great start. We've had over 60 clients, I think, sign up for it. And we have received terrific response from the industry. My favorite is an e-mail from one of our top clients. And I quote, "Congratulations, this is a game changer." And I think the reason is that it is a really unique offering, where for the first time, people can get audiences combined and deduplicated from PC, mobile and online video. I will also note that tablets are being added to multi-platform in the first quarter, so that will plug that gap. Youssef H. Squali - Cantor Fitzgerald & Co., Research Division: Will you be charging differently for that or will it just be used as a kind of a -- I guess enhanced value and lower churn?

No, there is a specific up charge for that. And I think it ranges, depending on the specifics of the contract between 20% to 30% of the upside for that contract.

Your next question is from the line of Matt Chesler with Deutsche Bank.

A few questions. So I think one of the dynamics that you are facing last year with vCE and the differential between bookings and revenue recognition was that, the early commitments I believe were smaller, but that there were -- these were guaranteed or they were fully committed to spending a certain amount on a 12-month basis. So I guess the concept was that -- well, if clients weren't spending at a rate early on in that period that you were assured of revenue growth by the conclusion of it. Assuming I'm understanding that correct, I'm just trying to get a sense in terms of how those clients spending patterns are and whether they've caught up with their commitment, or whether we should expect to see that true up.

Well, I think we -- I think that some of the contracts that we have on vCE contain 2 models. One model is, as you mentioned, a fixed commitment -- a fixed commitment for the year, which is really a minimum commitment and then if they exceed a certain threshold, then there is a per impression charge. And a lot of clients are going on a volume or a charge per impression basis. Now in many cases, even though the commitment, I believe can -- even the commitment is kind of held constant for the year, we're still accruing on a volume basis, right?

That is correct and most of these minimum items are through the course of the year and wouldn't be until the middle of this year, this year 2013. And then as we see these businesses continue to grow, with the additional new bookings that we have. You have some of that same impact as well.

And hey, Matt, this is Serge. Just wanted to give you additional color. So at the beginning when we launched vCE, as you know, people were just testing it out. It's a new product, so they were doing all these test campaigns, towards the end of the year especially in Q4, we started seeing a lot of 6 and 7-figure all-in deals from clients where they're now saying, okay, we tested this. We like it. And now we're going full in for all of 2013. Some examples include Kellogg's, Mars, Ad.com, the list can go on. But those are at least 2 or 3 big clients that have signed up for 6- to 7-figure deals.

Okay. Next question would be, in the -- in anticipation of the -- likely, the Nielsen Arbitron acquisition gets approval and goes through, do you feel it necessary to come up with any contingency planning or plan B, or alternative strategies to go after the cross-platform business after your contracted revenue in this particular arrangement runs out? I'm just trying to get a sense for how that fits in and what you're thinking about that.

Well, I guess the first thing is that as you know that deal is still being reviewed by the FTC, and it would be premature to comment on it before the antitrust review is finalized. At the same time, we are highly bullish on our business analytics strategy that is really not affected by this. As far as backup plans for cross media, we have done all of our cross media work in the past and we're developing methodologies to do it based on set-top box data, and that would be some of the contingency plans that we'd have.

I guess the concept though is that whether or not Arbitron, or Nielsen Arbitron, chooses to remain in partnership with you, that you have the capabilities and you intend to continue to go to market on your own, without an operator?

I really don't want to comment on that, given the antitrust review.

Okay. Sure. And then just finally on cost, the -- your anticipated $9 million of savings, could you just give us a sense as to how much relate to the disposed businesses versus other actions you're taking? And then if you can give an FTE count for year-end, that will be great.

Sure. This is Ken. I can take those. Between the split, it's probably about $4 million relating to disposed businesses and the balance on the ongoing businesses. And so on a net basis, there'll be some reinvestment, but that's going to give you a sense of how it is. At the end of the year all in, our FTE is 1 1 3 7 from -- at 12/31/12.

Your next question is from the line of Shyam Patil with Raymond James. Shyam Patil - Raymond James & Associates, Inc., Research Division: I just had a few questions. In terms of the revenue, it looks like over 2012, you're expecting about $30 million to $31 million in incremental revenue. Just curious if you could break out how much of that incremental amount is from these new products or newer products, versus the core Media Metrix business.

Sure. This is Ken. I would say probably at about a 2/3, 1/3 mode from that standpoint overall. I mean, we're going to see continued strong growth as Magid mentioned, in terms of double-digit growth, with our core business. But we will see more acceleration, as Magid showed in terms of the contributions on a bookings and that standpoint. So in terms of the 85% subscription, I'd kind of take something in that neighborhood. Then of course, we also have our project business on top of that. Shyam Patil - Raymond James & Associates, Inc., Research Division: Got it. And then in terms of the gross margins, you said you expect improvement in 2013. Just wondering what -- should we be using 67% as kind of the baseline and expect improvement from that level?

Well, I think we ended the year, as you know, at the 65 plus, I think you start dealing with 60 over the course of the year from where we are, the 67 to 68 range makes sense. And just kind of progress up during the year. You might see it tick up a little bit more starting in Q3 because we do have the impact of the social taxes and vacation accruals, which do impact the people cost in cost of goods sold in the first half of the year. Shyam Patil - Raymond James & Associates, Inc., Research Division: Got it. And then on the operating margins, or EBITDA margins, how should we expect those to trend as well throughout the year?

Sure. Again, you have obviously, the midpoint of the 16% in the beginning. If you get up to kind of the midpoint of the 18% or so, I would say it's going to be in the second quarter maybe getting to 17% and then start to expand from there. And the faster we get the expansion, the higher we are in our range as we go through the year.

Ladies and gentlemen, we have no other questions at this time. So I'll turn the call over to Magid Abraham, for some closing remarks.

Okay. Well, thank you and thank you very much for your participation today. We believe our performance in 2012 has positioned us well to deliver improved top line growth in 2013. And that as we drive operation -- operational efficiencies, we can simultaneously deliver increased profit margin. We are focused on that and we look forward to speaking with you again on the next conference call. Thank you.

Ladies and gentlemen, that will conclude today's conference. Thank you very much for joining us, and you may now disconnect. Have a great day.