According to a report in Financial Times, some big media companies, fed up with Nielsen reporting, are forming a consortium aimed at challenging Nielsen. Participants in the consortium include the neworks owned by NBC Universal, CBS, Viacom, News Corp and Disney. They expect the consortium, which also includes big advertisers Proctor & Gamble, Unilever and AT&T to be operational by September.
Neither the networks or advertisers are happy with current reporting for viewing across multiple media platforms.
Audience measurement is considered the lifeblood of the media industry. The $70bn spent on US TV advertising each year is allocated according to viewer numbers. The explosion of online viewing has made the measuring of total audiences across all media platforms more difficult.
“The most deficient thing is there’s no single source measurement [for TV and digital video],” Sam Armando, senior vice-president of audience analysis at Starcom Mediavest, told the Financial Times.
It was not a case of “let’s go out to replace Nielsen”, he said, but the consortium’s plan did not require a “leap of faith”.
The story says the consortium expects contracts to be awarded for set-top box data and measuring online viewing as early as the fourth quarter.
The story notes that Nielsen itself has its own "convergence" panel that measures both television and online viewing, but that is not currently part of any of the reported ratings and Nielsen doesn't expect to roll it out fully until 2011.
I'm not optimistic that this will pose much of a challenge, though I'd be delighted to see it result in one. There's a lot of bluster from both networks and advertisers over measurement and it seems to be:
We want good measurement but we don't want to pay a ton of money to achieve it.
It's a pretty tricky proposition. Set-top box data provides a lot of information, but there are issues with it that range from "we don't know who is watching!" (to give the advertisers the demographic data they so crave) to "it counts everything as long as the set top box is on." Speaking for myself since the installation of my first TiVo ten years ago now, I haven't turned off my set top box in a almost a decade. I'd be counted as watching ESPN about 19 hours a day...
Those are solvable problems, but solving them will cost money. A lot of money. The networks and advertisers never seem to want to fund such things. There is always clamoring for out of home measurement from the networks, but, the advertisers don't want to pay for those eyeballs, and the networks don't want to fund the measurement. The challenges here seem much bigger to me.
TV advertising is a huge business - $70 billion -- and it is driven based on ratings. They are the equivalent of stock quotes for TV advertising and though both advertisers and networks kvetch about Nielsen, the Nielsen numbers are the agreed upon standard. Coming up with another standard both sides will agree on is far, far easier said than done, and again, an expensive proposition.
I'd love nothing more than two ratings sources, it would create some contrasts that would be a lot of fun, both for us as a web site that focuses on ratings, and for the fans. But even if successful it will also seemingly result in problems like this:
When the new ratings data says Mad Men has 2.5 million viewers and Nielsen says it has 1.8 million, the advertisers will want to pay based on Nielsen data, but AMC will want to charge based on the new data! If the next week Nielsen says Mad Men has 2.5 million and the new data says it has 1.8 million it will be exactly reversed.
What would Don Draper do?
Sounds pretty ridiculous to me. I’m imagining a bunch of suits not understanding what sampling is, ignoring their business analysts describing how sampling works, and then going “well duh we need online numbers to say more people watch a show, throw some money at it!”
The way people watch things online can’t be the same way they watch them on TV, and that seems to be a given from what we’ve seen so far. Who cares if 700,000 people watch Mad Men online, these aren’t the same 1.5 million that watched it on TV and you aren’t going to have the same commercial breakdown for online that you will for TV, especially when people can’t skip the ads on the computer the way they can on their DVR.
Still, if they need someone to help with their efforts on this new project, as long as I can still work the job in the DC area and they pay me more than I’m getting paid now, I’d be happy to help.
time-warner doesn’t need a set top box. the already know what I’m watching on my digital cable.
Corey, if you’re the only one in your house, that might be true. However, that’s not the Time Warner this is talking about. Time Warner Cable might have set top box data, but the Time Warner owned TBS, TNT, TruTV, Cartoon Network, etc., don’t use that data to sell advertising.
It would be cool if they could come up with a better system to count viewers.
Correct me if I’m wrong, but the complaint seems to be combining TVand online, not how TV ratings are measured. The problem with combing the ratings is that advertising is sold separately. This might help with product placement deals but won’t save broadcast TV. So what do the suits think they are going to accomplish? Considering the completely different advertising structures online vs TV they can’t exactly start selling them as one.
Also, I switched my gravatar. Not sure if I like it.
I’m not entirely sure, but the total number of viewers, live and online, could all potentially be watching it live.
What I would be curious to see if, once they get their methods together (Robert, I agree with your skepticism of how far they are really going to go with this, btw, so I am not planning a welcome-aboard party for their rating counting system), what they would do if their numbers came in as low — or lower — than the ones they are getting from Nielsen. What if they ended up proving to themselves with their system that their numbers are, collectively, heading into a pit and the networks are only 1 step away from being passed by USA, SyFy, TNT, and other networks?
I saw some set-top box software at this year’s NAB that basically assigns users to each member of the family. It’s very pretty, has personalized channel lists, is integrated with social networking sites, etc. Enough of a value added to make each family member want to log in individually. And although it wasn’t demoed, I wouldn’t be surprised if you get logged out after a specified time of disuse.
The hurdle of knowing the demographics of each viewer may be solved, save the headache of strongarming the large cable companies and/or DirecTV into adopting something like this.
They’re “fed up” with Nielsen, but they can’t think of anything better? Sounds a little silly of them. Don’t get me wrong, if they can come up with a better method than those expensive Nielsens I’d be all for that, but their idea sounds like it would give wildly inaccurate numbers. Back to the drawing board for them.
Big article over in the UK a month or so back about Sky, which now has 10 million subscribers, using the new upgraded boxes (which are essentially PCs) to monitor what we’re watching and transmit it back daily. The idea was to track live viewing, as everything comes through the Sky satellites, DVR viewing on our Sky+ boxes, and on demand viewing from the Sky Anytime service. They already release Sky Anytime data on the Sky Media website as they can track this accuratley.
this sounds like a service Rentrak can do with a jt. venture with the content providers
What does this really mean? Is Nielsen going out of business??
“They’re “fed up” with Nielsen, but they can’t think of anything better? Sounds a little silly of them. Don’t get me wrong, if they can come up with a better method than those expensive Nielsens I’d be all for that, but their idea sounds like it would give wildly inaccurate numbers. Back to the drawing board for them.”
If a new system like that provides wildly inaccurately high numbers, they’d be all for it.
One thing that has not been discussed about online viewership is that there are about 1 Billion possible viewers that could watch an episode of Mad Men online. 700,000,000 of those people are outside the US. Would commercial content be the same for viewers accessing the site outside the US? Product names are different across countries in many cases so only major brands like Coke, FedX, etc would make an impact across all countries. I guess there is a way to insert different commercial content based on ISP? I am not sure how that works but it sounds complicated.