• by Wayne Friedman , Staff Writer, June 13, 2005

Small local TV stations already find themselves in a death spiral of competition, and some say Nielsen isn't helping by cutting the engine.

Increasingly, many are losing ground to local cable operators on one side and the Internet on the other. So, a number of small market stations - from DMA's ranked 50 to 140 -- are canceling their Nielsen Media Research contracts, according to a Broadcasting & Cablearticle.

B&C doesn't put a count on it, just an assumption, that stations increasingly can do without Nielsen. Nielsen says that stations drop off the grid periodically, then later get back on.

But this environment may not be business as usual.

For years, Nielsen's credibility has been called into question, especially its handwritten diary method, which can be rife with inaccuracies, according to research experts. More recently, bigger markets complain its new local people meter (LPM) technology - intended to replace its diary - undercounts young and minority viewers; some bigger market Univision stations didn't buy Nielsen for six months.

So, if you are in a small-market, say the 75th designated market area or below, struggling to even reach fourth place, what do you have to lose by cutting back some costs? Small market stations pay anywhere from $50,000 up and major markets pay upwards of $1 million. These stations say they can use other research tools, other selling points such as program 'environment' to entice advertisers.

Walking into a small local agency when your station is in fourth or fifth place, with a Nielsen book under your arm isn't much help in gaining business or increasing share. Local ad agency or media buyers are already buying up Nielsen - and using it against you.

Ironically, local stations hope to benefit from the competition's future technology tools. Local cable operators' digital set top cable boxes promise to offer a more accurate assessment of viewer information. And yes, by the way, both have mutual interests -- local stations, lest we forget, are carried on those cable systems.

Poor Nielsen. It gets it on both ends. Not just for its age-old problems of the diary method, but with LPMs, the supposedly new and improved technology that will rid the business of the out-of-date diary method. Viewers still don't fill them out correctly, sometimes Nielsen has recruitment problems, and diaries sent out by Nielsen sometimes don't get to the intended Nielsen homes in time.

Years ago, one TV consultant who was working for WPIX in New York told me an eye-opening story about an old New York City woman who was a 'Nielsen home.' She couldn't get her TV to work and was a little befuddled. But she didn't call up Nielsen to fix the problem. She called WPIX. That's when a consultant - sort of tongue-in-cheek - gave her some interesting self-serving advice:

"Well, the first thing you need to do is leave your TV set on 24 hours a day on WPIX," he said. "It'll clear things right up."