TV Nets Rally, Fail To Reach Consensus On Controversial Nielsen Expansion Plan

As Nielsen prepares to make the biggest changes to its national TV ratings methods since it introduced the people meter in 1987, some of its biggest customers -- broadcast and cable networks -- held a vote to determine whether they should put pressure on Nielsen to delay the move past this fall when it is scheduled to start.

The vote, which was organized by the newly anointed Video Advertising Bureau (VAB, formerly the Cabletelevision Advertising Bureau), failed to reach a consensus and the bureau resolved to take no official stance, but to continue monitoring the situation as the new ratings begin to impact the marketplace.

The methods, which are part of Nielsen's "NPX," or National Panel Expansion plan, include a particularly controversial one that would expand part of its ratings sample by mathematically modeling viewing behavior to represent the viewing of people not participating in the sample.



Regardless of the soundness of the methods, which Nielsen executives have maintained are necessary given the rapid fragmentation of TV -- and ultimately “video” -- viewing, their impact could be profound, causing some networks to increase or lose share based on the mathematical shifts. Since advertising budgets generally correlate to audience shares, those shifts could create substantial disruption in advertising budgets and so-called “makegoods” -- commercial time given as compensation to advertisers for failing to meet their audience guarantees.

The vote, which the VAB characterized as having “little consistency and no-near consensus,” included four possible recommendation to Nielsen: 1) Do nothing and leave the sample expansion launch in place for this September, 2) delay it until January 2016, 3) delay it to September 2016, 4) or scrap the sample expansion plan altogether. By not reaching a consensus, the group effectively voted for option No. 1, because as one VAB member explained: “Nielsen plans to move forward come hell or high water.”

While the VAB vote would have largely been symbolic, a more important vote is set to take place at some undetermined time in the future, which could have more material impact: The national television committee of industry self-regulatory ratings watchdog, the Media Rating Council. Many of the executives participating in the VAB vote are also members of the MRC committee, which has been in the process of evaluating Nielsen’s sample expansion methods, including one or several audits by independent auditors, to decide whether or not to accredit Nielsen’s national TV ratings.

While it has no regulatory weight, MRC accreditation is recognized as an important stamp of industry approval on the soundness of doing business based on ratings methods audited by the council.

It’s also unclear when the MRC will actually complete its audit of Nielsen’s new methods, but executives familiar with the process say it now seems unlikely it will be completed in time for the launch of the new fall TV season, which would technically mean this would be the first TV season ever to begin with unaccredited ratings since the MRC was created in the 1960s following Congressional hearings on TV ratings and a U.S. Department of Justice review that led to a consent decree that formed the MRC.
5 comments about "TV Nets Rally, Fail To Reach Consensus On Controversial Nielsen Expansion Plan".
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  1. Nicholas Schiavone from Nicholas P. Schiavone, LLC, July 2, 2015 at 10:28 a.m.

    It would seem that the TV, Agency & Research Industries are
    re-enacting a classic scene from a Laurel & Hardy comedy sketch,
    where the indignant Oliver Hardy utters to the pathetic Stan Laurel:
    "Here's another NICE mess you've gotten me into."
    How this comedy routine started remains a mystery.  
    How Nielsen fumbles and bumbles through methodological crises
    remains no mystery and no laughing matter.
    It's time for an examination of conscience,
    once we have had a good laugh.

  2. Leonard Zachary from T___n__, July 2, 2015 at 12:45 p.m.

    Avoiding the Inevitable. The Audience Data and Technology already measures viewing of many people not particpating in the sample. Add the negative growth on legacy business model metrics and it confirms the numbers. Why is mathematically modeling even considered when most Americans are connected via mobile with a device? The data is there.....

  3. Nicholas Schiavone from Nicholas P. Schiavone, LLC, July 2, 2015 at 3:42 p.m.

    Dear Mr. Zachary,

    Let's be clear about a few matters:

    • I do not understand what you have written, but it matters not in the final analysis.

    • There is a truth that almost everyone in "our" business fails to understand, except perhaps for distinguished researchers and thoughtful commentators like Mr. Ed Papazin. Essentially, there are no objective measures for subjective events.  Hence, there has been no real measure of TV (or digital video) Viewing for the past 65 years, even though we have Nielsen TV Ratings.  Such statistical estimates are pleasant, even useful, proxies but not the "truth."  Worse, if Nielsen alters its methods as "threatened," Nielsen Ratings could reach "Half-Truth" status.  (After all, what does one get by adding Fictional Data (i.e., modeled estimates) to Non-fictional Data (i.e., tabulated audience)?

    • Finally, I infer from your words a belief in All Things Digital.  Sadly, then, you, like many, suffer from "The Illusion of Technology" and the "Big Data Delusion."

    Like a man inspired ... or delirious, you close your commentary by proposing that the telefonini (the mobile device) will be our Salvation.

    Well, I propose that the end of media research and TV ratings integrity could be nearer than The Last Judgment.

    Enjoy the Fourth...the Fifth...the Sixth and any other data you can get your hands on.  

    It's time to find something to celebrate instead of fear.

    Onwards & upwards!

    Nicholas P. Schiavone, LLC

  4. Nicholas Schiavone from Nicholas P. Schiavone, LLC, July 6, 2015 at 11:25 p.m.

    Thanks for letting me have the last word,
    but this story is not about me or my business.

    It's about yours.

    Monday has come and just about gone.
    There seldom was heard a discouraging wordAnd the sky was not cloudy all day.

    But why should we be surprised?
    When TV Ratings were born we talked of "statistical significance"
    and "intellectual integrity."  Today, we speak of "Big Data 
    And "Black Boxes"... not to mention "STB Ratings."
    The latter nonsense all; especially if you believe in
    probability-based random sampling & tabulated respondent panel data.

    Perhaps a wise, but unknown, statesman might prophesy by proclaiming:
    "There are three kinds of lies: lies, damned lies, & Nielsen's proposed NPX statistics."
    Or perhaps, such a visionary has yet to speak out.  Keep listening!

    Onwards & upwards.

  5. Nicholas Schiavone from Nicholas P. Schiavone, LLC, July 9, 2015 at 3:31 p.m.

    One week of astounding & embarrasing silence for an critical issue with crisis impact
    The Media, Agency and Reserch industries are acting like the GOP v. Donald Trump.
    The conspiracy of silence ought to end here and now!
    First Recommendation: Prepare for final deliberations by reading the latest from the HBR:

    "What Every Manager Should Know About Machine Learning"
    by Mike Yeomans, Harvard Business Review

    Excerpt: "It’s important to draw a distinction between “out-of-sample” and “out-of-context”. Measuring out-of-sample accuracy means that if we collect new data from the exact same environment, the model will be able to predict the outcomes well. However, there is no guarantee the model will be as useful if we move to a new environment."

    Copyright © 2015 Harvard Business School Publishing.
    All rights reserved.

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