The changes were prompted by Nielsen's transition from analog to digital TV, and the fact that its new digital TV metering system - the so-called A/P meter - cannot identify channels unless they are digitally encoded. As a result, all channels that are not encoded will be lumped together as a single channel. Similarly, Nielsen said all video-on-demand channels programmed by cable and satellite TV operators will be listed as a single channel
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Channels Receivable Methodology: Example
Old Count New
Count
6 VOD Channels 6 1
4 Non-Monitored/Non-Encoded Channels 4 1
4 HBO 'Plexes' 4 4
6 Broadcast TV Stations 6 6
Source: Nielsen Media Research.
Aside from being a technical solution to a digital metering problem, the decision represents a smart tactical move for Nielsen, giving all TV outlets an incentive to become encoded if they want to be included in the Nielsen universe.
The effect on the TV universe is mainly symbolic. Advertisers and agencies don't plan media buys based on Nielsen's channels "receivable" data, but it has served as a useful chronicle of U.S. TV viewing environments. When combined with a second piece of data, the number of channels actually "tuned" by an average household, the impact of a burgeoning multichannel TV marketplace became evident.
As a result of the change, 20 years worth of historical data go out the window, marking another in a series of redefinitions and recalibrations of TV viewing and the TV universe Nielsen is adopting as it makes the transition to digital TV. Other big changes include the inclusion of digital video recorder households beginning this year, and a plan to begin prompting people meter households based on time intervals, as opposed to when they turn on the TV set or switch a channel.
Meanwhile, Nielsen's new TV channels method indicates the average TV household received 92.6 TV channels in 2004, up from 85.8 in 2003. However, the average household only tuned in 15 of those channels, meaning they watched them for 10 or more continuous minutes during the week of Aug. 30 to Sept. 5, 2004, the week Nielsen surveyed them. That means the average TV household watched only 16 percent of the channels that were available to them. The new data also indicates that the more channels a household has available to it, the lower the percentage of channels tuned. In the most channel-rich TV households, those that have an average of 157.3 channels available to them, only 19.4, or 12 percent, were actually tuned.
Average Number of TV Channels Receivable
New Method Old Method
1985 NA 18.8
1990 NA 33.2
1995 NA 41.1
2000 61.4 74.6
2001 71.9 89.2
2002 79.7 102.1
2003 85.8 100.4
2004 92.6 NA
Source: Nielsen Media Research's "Television Audience 2004" report.