• by Joe Mandese  @mp_joemandese, March 11, 2004

If the comments of top media researchers at a TV advertising conference on Wednesday are any indication, the TV audience research business is becoming a tale of two - or possibly even three - worlds.

The current world, which is dominated - indeed essentially controlled - by Nielsen Media Research, likely will fall under even more of its control, its chief researcher told an audience of advertisers, agencies and network executives gathered at the Association of National Advertisers' Television Advertising Forum in New York.

Less than a week after Nielsen made a unilateral decision to fundamentally alter how it measures, estimates and reports TV audience viewing, Paul Donato, senior vice president and chief research officer, revealed more of its new, go-it-alone strategy.

"There really will not be time to get the kind of consensus that we've gotten in the past," he said, alluding to a research "renaissance" that would necessitate Nielsen act more quickly and decisively to deal with rapid changes in TV technologies and audience behavior than it had in the past.

It was just such a move by Nielsen that has elicited an outcry from clients on all sides of the negotiating table during a series of annual national client meetings being held in major markets this week. In particular, Nielsen clients said they were taken back by the researcher's decision to rush ahead with a plan to begin measuring viewing via digital video recorders next year and to delay the introduction of its new digital TV metering system by a year. Nielsen said it made the decision to avoid the long, drawn-out harangues that typify its client approval process.

Donato noted, for example, that even a relatively simple plan to begin weighting its national ratings sample to bring it into balance with the U.S. population - a move he said would affect TV ratings by only "tenths of a point" - was delayed by three years due to jostling and infighting by its clientele.

Nonetheless, the move comes at a time of supreme frustration in many of the ways Nielsen does business, and not just how it gathers and reports ratings, but how it deals with its customers. In fact, that behavior has triggered an investigation by the Federal Trade Commission, following complaints by clients - particularly Madison Avenue - that its practices are predatory and anticompetitive.

Nielsen's Donato said the company is simply being proactive in the face of critical market changes. "Half of our clients say we are going way to fast. Half of our clients say we are going way to slow," he said.

Nielsen's marketplace approach is proving a stark contrast to Arbitron, which has competed with Nielsen in the past and is collaborating with the TV researcher on the development of a promising new portable people meter system that would measure both TV and radio - and possibly other media and even consumer purchasing behavior.

Even though many in the industry feel the Arbitron system may be the most immediate solution to many of the most vexing media research issues, Arbitron has taken a slow, methodical and judicious approach to its development. It's also a development process that has been slowed down by its erstwhile partner Nielsen, which retains an exclusive right to utilize TV ratings data generated by the system in the U.S.

Linda Dupree, senior vice president for portable people meter/new product development at Arbitron, noted the process has been slowed down by requests from Nielsen to conduct two engineering tests of the system. The system has already been deployed in other markets, including one by Canada's BBM, which is showing some promising results.

Meanwhile, Dupree unveiled just how far Arbitron is willing to bend over backwards to placate its clients in the development of the PPM. During Wednesday's ANA session, she said Arbitron has agreed to fund a study, to be conducted by a third-party market researcher, on the "economic impact" the PPM would have on the radio industry.

Arbitron has not yet retained that third party and is working with the Radio Advertising Bureau to set the project's goals. Among other things, radio broadcasters are concerned that while PPMs will generate vastly more credible data than their current paper diary system does, it will radically change the relative audience shares of radio and television. Arbitron's and Nielsen's PPM tests have shown that radio usage remains relatively flat via the new system, while TV ratings are about 60 percent higher - mainly because the PPM captures out-of-home usage of TV, something that is implicit in radio's measurement.

She noted that Arbitron has also developed some fine-tuning of the PPM, including a new version that will enable Arbitron to discern when consumers are exposed to media inside their homes or out of their homes.

"If we're trying to wait for the perfect system, that day may never come," observed Dupree.

And while it may not be a perfect system either, the promise of a third scenario for TV audience measurement - a census-based system derived from the expanding sea of digital TV set-top devices - showed some promise on Wednesday, when Jonathan Sims, vice president-research for Comcast Corp.'s advertising sales unit, left the door open that the company might someday release the highly refined data on TV viewing behavior generated by the company's set-tops.

But if and when that time came, he said he would recommend, "our company to get away from the process and get a third party company in there."

Meanwhile, Sims said Comcast's own research program has been heading down two distinct paths: One is a "diagnostic path" designed to understand how cable subscribers are viewing TV, especially via advanced TV services such as video-on-demand. "The other path," he said, "is the business of currency ratings" that are used for the purposes of conventional advertising sales.

One other surprising development to be announced during the session, was a plan by Nielsen to test a new, "cheap" TV metering device that is inexpensive enough to be mailed to sample households and reused over and over again.

Nielsen's Donato said the new device promises to be a solution to the economic issues that require Nielsen to use paper diaries in most of the nation's TV markets.