• by David Goetzl  @dgoetzl, July 16, 2007

The latest Nielsen ratings reflect how many impressions networks lose with the new C3 ratings. They confirm that the Big 4 networks experience a falloff of between 2% and 5% in prime time, while MTV and VH1 each lose about 15% among their younger viewers.

For the four-week period from May 28 to June 24, the best-performing network was Fox--which held onto 97.8% of its 18-to-49 audience on average in the C3 ratings, when compared to live program ratings. The network posted a 2.24 average in C3, down slightly from a 2.29.

NBC--moving up in the early summer to a tie for second place from fourth during the season--held onto 96.8% of its 18-to-49 viewers, with a 1.83 in C3 versus a 1.89. CBS retained 96.3%, while ABC, fourth in the early summer, kept 95.5% on average.

Among the top-10 cable networks in prime time, Lifetime had the highest retention rate among 18- to-49-year-olds, with 96.7% (a .29 C3 versus .30 in live program average). A&E and FX tied for the lowest at 92.6%. The highest-rated cable network over that period, TNT, buoyed by drama hit "The Closer," retained 93.9%.

Although it aired a lot of live events, which the network argues lessens DVR use as well as commercial-skipping, ESPN still lost about 7% of its audience on average.

In the 18-to-34 demo, MTV and VH1 each lost 15% of their prime-time impressions.

The ratings cover only the first weeks of summer--when re-runs are heavy on the Big 4 networks and DVR use is surely down--compared to the regular season, when viewers record first-run episodes. But if the trend holds, networks, as always, could find that through effective inventory management, they can continue to stabilize and grow revenues.

Even the modest drop in impressions caused by C3 makes the CPM growth networks received in the upfront somewhat less jaw-dropping. For example, all things being equal, if ABC loses 5% of its impressions but gets a 10% CPM increase, its revenues might rise only the 5% differential.

Still, while the CPM increases don't necessarily help a bottom line, they do show that buyer demand for television spots is high, since advertisers are likely paying more to reach fewer people.

C3 is the term that emerged during the upfront to reflect the market's new dominant currency, where guarantees are based on average commercial ratings covering three days of DVR viewing. For decades, program ratings had been used. In some cases, they still were in the cable market.

For Viacom's MTV Networks unit overall--which made deals based on a combination of program ratings and commercial ratings--the C3 ratings offer a mixed bag. While MTV and VH1 each lost about 15% of their 18-to-34 viewers in prime time in the May 28-June 4 period, sister channels Comedy Central and Spike performed much better. Among adults 18-to-49, they retained 96.6% and 96.3% of their audience, respectively.

MTV and VH1 might also have a higher retention rate in other dayparts that could help on the revenue front, since the networks do not sell prime time separately.

ESPN, which apparently has bucked the trend toward C3 and is making deals on program ratings, will benefit. The net loses about 7% of its impressions with the C3 ratings.