No, it doesn't
The SRD's entry for Contact Entity is in error. The following paragraphs does not exist in the Horror Adventures, page 111 for the sidebar and 113-114 for the spells:
Each intelligent creature in the spell’s area takes 1d6 points of Wisdom damage as their perceptions of reality realign with yours for the spell’s duration. Listeners with at least 5 HD can attempt a Will save to negate the effects. Your targets view you with a friendly attitude and respond to criticism of you with irritation.
Bluff, Diplomacy, or Intimidate checks to create doubt about your purpose in those affected by the spell take a –4 penalty. The attitude of your targets regarding any creature that criticizes you or your vision automatically changes one step toward hostile; a Diplomacy check that fails by 5 or more reduces their attitude further. Your targets retain the same alignment and their prior beliefs, in addition to the ones you force on them. You can’t force beliefs on a target if such beliefs would be necessarily against the nature of its alignment and prior beliefs, but targets are otherwise able to hold contradictory beliefs.
If your campaign uses the sanity system, your sanity score decreases by 2 (and thus your sanity edge decreases by 1) instead of taking Wisdom drain each time you cast this spell. Only greater restoration, miracle, or wish can remove this decrease. A single casting of greater restoration removes one decrease in sanity from casting compelling rant, while a casting of miracle or wish removes them all. Affected targets take sanity damage equal to half your caster level (maximum 10) instead of Wisdom damage.
The targets might actually change alignment and beliefs if their loss of sanity afflicts them with an appropriate madness, in which case those effects last even after the spell’s duration has ended.
This text is actually from the Compeling Rant spell (missing the first paragraph and being completely out of context), which is on the same page as Contact Entity's sidebar (112) and got copied over by accident.
Assuming there are any creatures to be contacted in the first place, the spell will alert them that there is someone that wants to make contact, which they may answer or not (up to your GM), but it does very little other than that.
Keep in mind that the spell's Casting Time, 1 minute, makes this not be a viable combat resource, even if the GM takes the (erroneous) SRD text into consideration.
Compeling Rant on the other hand, works exactly like you describe. It has a 1 minute Casting Time, and affects any number of creatures in the "spell area", which isn't actually defined, but the spell has a Range of 100 ft + 10 ft/level (which is pretty huge), so the "area" would actually be all creatures that you decide to affect. You do take 1d4 Wisdom drain, and is a valid target for that 1d6 Wisdom damage as well, depending on wether you include yourself as one of the target's or not.