• by Joe Mandese  @mp_joemandese, December 21, 2011

An acceleration in the number of TV stations and networks signing up for Nielsen rival Rentrak’s audience measurement service has gotten Wall Street’s attention, if not Madison Avenue’s. In a note sent to investors this morning, the equity research team at Deutsche Bank called Rentrak’s record pace of TV station contracts during the third quarter “material,” and implied it is likely to push Nielsen to accelerate its own efforts to develop and deploy some form of digital set-top data-based audience measurement service.

Earlier this week, Rentrak announced an important deal with the Post-Newsweek TV station group (MDN Dec. 20), which Deutsche Bank analyst Matt Chesler noted brings the number of new stations signed up to 30 during Rentrak’s most recent fiscal quarter, and bringing the total number of subscribing stations nationwide to 113 across 27 station groups in 59 local TV markets.

“That, we believe, is material,” Chesler wrote, adding that the securities firm nonetheless remains “cautious” on investing in Rentrak’s shares, especially given Nielsen’s strong dominance in the marketplace, and the fact that it is nurturing its own “return-path,” or digital TV set-top data-based service, which Nielsen executives are expected to unveil early next year.

The Post-Newsweek deal is especially intriguing from Madison Avenue’s point-of-view, because the group indicated it plans to utilize Rentrak’s data as the basis of “currency” for selling advertising time. To date, only one major agency, Aegis Group’s Carat, has signed up for Rentrak data as the basis of negotiating advertising buys.

While upbeat on Rentrak’s prospects, the Deutsche Bank report indicates that its recent momentum is not expected to have a significant impact on Nielsen’s near-term revenues, though it is likely to put pressure on Nielsen to move forward with its digital set-top initiative.

“Nielsen is not standing still,” Chesler writes, noting that last Spring Nielsen released results of the second phase of digital set-top data studies in St. Louis and Reno, and that it will conduct a broader “hybrid pilot” in 2012.

“The current plans use a hybrid approach in which return path data improves upon the existing currency, are centered around local only, and will be delivered on a market-by-market basis and led by clients,” Chesler explains, adding that while such data is the primary model for Rentrak, it still is being positioned only as an “alternative or secondary currency” for Nielsen.