• by Joe Mandese  @mp_joemandese, May 6, 2011

Three years after the national TV advertising marketplace shifted to C3 ratings as its de facto currency, the Nielsen TV commercial audience estimates were finally accredited by the media industry's self-regulatory watchdog. That was nearly a year ago, but nary anyone knew about it, raising questions about the role of media accreditation, and the need and responsibility of making people aware of it. The Media Rating Council, which conducted an extensive audit of Nielsen's convoluted C3 ratings and accredited them in June 2010 says it was Nielsen's responsibility to announce it. Nielsen executives say it was the MRC's responsibility.

Whoever's responsibility it actually is, the reality is that few people in the industry actually know the C3 ratings have been accredited, even though billions of TV advertising dollars are planned, spent, and validated on the basis of those estimates.

That revelation came to light recently during a panel discussion on the state of TV audience metrics at MediaPost's Outfront conference, during which Turner Broadcasting Chief Research Officer Jack Wakshlag disclosed that he thought the C3 ratings, which were introduced in May 2007, had actually been accredited by the MRC. Asked afterward by MediaDailyNews Wakshlag said he wasn't sure when the MRC completed its audit and accredited the MRC, even though he was a member of the committee that accredited the service, and went back to the MRC to confirm the details. As did MDN, which was told by MRC Senior Vice President Anthony Torrieri that Nielsen had received accreditation for its C3 ratings in June 2010, but the disclosure "may have gotten lost" as part of another announcement Nielsen made in July 2010 about receiving MRC accreditation for all 25 of its local people meter ratings.

A Nielsen spokesman said the C3 accreditation was disclosed in that announcement, but that Nielsen was mainly focused on getting word out about its local people meter service, which had been fighting a contentious battle with local broadcasters about their rollout in several major markets.

The local people meter accreditation release included the line: "This decision follows a similar MRC vote to renew accreditation for our national ratings service." But that technically was not an accurate disclosure, because the MRC wasn't simply renewing accreditation of an existing service, but had to conduct an extensive audit of new processes and methods to accredit C3 ratings, which are a hybrid of two sources of Nielsen data: its conventional people meter audience measurement ratings; and its Monitor-Plus commercial occurrence data. The C3 ratings, which are ratings for the average audience during commercial breaks, are computed by integrating Monitor-Plus' estimates of where and when TV commercials air with Nielsen's overall audience estimates for the TV programs they appear in.

The MRC's Torrieri says Monitor-Plus has never been audited and accredited by the MRC, but that the components of Monitor-Plus' data that are used to compute C3 ratings, and the process Nielsen uses to integrate them with its TV audience estimates were, and that was what received accreditation in June 2010, meaning it was not a renewal of an existing TV ratings process.

Asked a week ago if the obfuscated reference in its July 2010 local people meter ratings release was all Nielsen has done to date to let the industry know that C3 ratings had been accredited, a Nielsen spokesman said he would look into it, but so far has declined to comment further. Speaking off the record, a senior Nielsen executive acknowledged that the company could have done more to inform the industry, but said it wasn't clear whether it was Nielsen's responsibility or the MRC's.

The MRC's Torrieri and Turner's Wakshlag said it was customary for the ratings company to announce the accreditation.

The whole process raises question about the role of accreditation, which is intended to give the users of media ratings confidence that they have been reviewed, audited and given a stamp of approval by an objective, self-regulatory industry body. Historically, most ratings were distributed via hard-copy reports, such as Nielsen's so-called pocketpieces, which would bear the MRC's accreditation stamp on their covers. But these days, ratings are mostly distributed electronically and devoid of such stamps.

Accreditation isn't necessary for a ratings service to be used and accepted as a form of media currency by the advertising industry, and there are plenty of examples of ratings services that serve that role without accreditation. Usually, they are new services that have either yet to apply for or completed the MRC's accreditation process. Occasionally, they are services that the MRC has withdrawn accreditation from, such as what happened last November to Nielsen's local TV diary ratings services. The diary service, which is the basis of ratings for most local TV markets in the U.S., failed to meet the MRC's standards, but continues to be used by local advertisers, agencies and broadcasters as the currency for local TV advertising buys in those markets.

Meanwhile, the tepid way in which Nielsen's C3 ratings accreditation was announced raises important questions about the role of accreditation. The MRC was established in the early 1960's at the behest of the U.S. Congress following a congressional investigation into questionable TV ratings practices back then.

The MRC's bylaws state that its mission is to, "secure for the media industry and related users audience measurement services that are valid, reliable and effective; to evolve and determine minimum disclosure and ethical criteria for media audience measurement services; and to provide and administer an audit system designed to inform users as to whether such audience measurements are conducted in conformance with the criteria and procedures developed."

That said, the results of the MRC's audits remain confidential to the MRC and the rating service, and there no explicit bylaw describing how, or whether the industry should be informed about them.