The process of quantitatively estimating audience behavior. Modeling is usually contrasted with the process of direct measurement in which meters, diaries, surveys or coincidentals are used to measure the behavior.  Typically, when viewing behavior is modeled, a set of measures is adjusted to represent a geographic area, demographic category or consumer target for which there is no direct measurement. Modeling in the broader sense may include any mathematical technique for combining or imputing data, such as ascription, fusion or weighting.

Source:
http://www.nielsenmedia.com/glossary/
http://www.arbitron.com/downloads/terms_brochure.pdf