Commentary

TV Ratings Can Be Iffy, Search On For New Metrics

by Wayne Friedman , Staff Writer, January 3, 2019

2018 witnessed big declines in traditional TV viewership — double-digit percentage-like declines.

The stock market for media companies is somewhat lower -- the average media stock-market price is down 6% to 7% or so -- year over year.

Those declining TV ratings -- live plus same day, plus three day, plus seven-day time-shifting -- isn’t enough. The picture is much more complex -- especially when TV content companies continue to find ways to sell and air their programming that doesn’t always correlate with near-term viewership data.

For years, HBO seemed to work on the same premise. Now, Netflix goes one step better, chiefly because it has its own distribution platform. HBO counts on traditional pay TV providers to continually show its value.

Still, maybe all will change -- or disrupt -- again. For example, some believe Netflix will -- at some point -- find a new separate business to sell advertising time along with programming viewing. That could mean new TV measurements.

Netflix adamantly denies it is interested in anything ad-related -- especially when there is Amazon waiting in the wings to pounce on a theoretically better ad-related TV business, perhaps connecting TV viewing to actual sales on one platform.

Maybe Netflix believes Fox got it right: Live TV stuff is the only thing that matters when it comes to big TV advertising unit pricing premiums. Air local and national TV news and all kinds of high viewing sports.

TV network companies have long complained that standard TV ratings -- except for sports and news -- are a waste of time for business journalists to base their stories when it comes to program performance.

Networks want to tout a bigger picture; journalists want the same. But how to really compare one show with another? Media companies need more ways to measure context -- not just new audience segments. Maybe that would include behavorial, cross-media platforms.

The TV marketplace is iffy. But dollars aren’t. How about basing TV shows on how they really do -- in dollars and cents -- across advertising, international and domestic sales.

Even if you don’t understand Nielsen TV ratings, everyone understands money.

netflix, streaming, tv

3 comments about "TV Ratings Can Be Iffy, Search On For New Metrics".

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Douglas Ferguson from College of Charleston, January 3, 2019 at 10:05 a.m.
Those who believe Netflix will kill their success with advertising are just wrong (or whistling in the dark). Box-office receipts and cost-per-thousand are irrelevant to steady subscription revenue, especially for a company with the first-mover advantage. Spot advertising made a lot of sense way back when there was simply no other way to monetize viewing by an anonymous audience. Netflix knows who's paying. Commercial interruptions are no longer essential except to those who sell them.
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Ed Papazian from Media Dynamics Inc, January 3, 2019 at 11:16 a.m.

Wayne, the "big" declines in traditional ( "linear" ) TV usage rates you are probably referring to are mainly for the broadcast TV networks and some cable channels for their primetime content and only for adults aged 18-49, which, in the case of the broadcast TV nets, constitute a minority of the audience. If you take all of "linear TV"s content---early AM, day, fringe, weekends, etc. as well as primetime and all of the audience, not just a so-called demo like 18-49---which is merely a metric for audience guarantees used by about 55% of all TV advertisers---the "big" decline is actually a much more modest one as anyone can see if they bother to check what Nielsen is publishing on its website. Yes, there is ongoing slippage--larger among the young but not so among older viewers---but the primetime 18-49 stats paint a misleading picture of the extent of "TV's" losses on an overall basis.

Paula Lynn from Who Else Unlimited, January 3, 2019 at 10:15 p.m.

And on today's MP, CBS said goodbye to Nielsen. What else is declining ?