us watch0812_us watch 10/12/2015 18:11 Page 1
Testing times for audience
Larry Gerbrandt asks whether new
measurement
audience tracking initiatives save
igital has been a
decidedly mixed
blessing for the
television industry. Digital
compression has led to the
creation of hundreds of new
channels, HDTV, IPTV,
streaming media (from
YouTube to Netflix), videoon-demand and digital video
recorders. It has also made
television viewing
measurement a nightmare.
While much of the recent
growth in the industry has been
driven by subscription-based
services, television programme
creation is still heavily
dependent on advertising, which
in turn is based on usage
measurement—ratings—and
equally important—the
demographics of the viewer.
In theory, digital video should
provide a quantum increase in
the accuracy of media
measurement. Set-top boxes and
DVRs can be remotely polled,
providing second by second
consumption. Web-based video
consumption can be tracked
through server logs. So why are
media executives and research
departments so frustrated by a
medium awash in terabytes of
viewing data?
The first problem is that an
increasing amount of video is no
longer being watched live, either
though VoD, a DVR or webbased streaming media.
Advertisers are reluctant to pay
for time-shifted viewing, though
there is a case to be made that
schemes that allow viewers to
fast forward through
programme content but not
commercials can make this
limited ad inventory more
valuable, especially when more
consumers are deploying adblocking technology on their
D
prime time television.
computers and smartphones.
The second challenge is that
the proliferation of viewing
choices has dramatically
fragmented live viewing. With
the exception of live sports,
virtually every television
programme in prime time on a
major US broadcast network has
suffered a loss of viewers in the
latest TV season. ‘Binge viewing’
has become commonplace.
Viewers are willing to wait until a
Data collected from set-top boxes
often can only report the channel
the box is tuned to, not whether
the TV set to which it is
connected is on or off.
Researchers have attempted to
overcome this limitation by
dropping boxes from the sample
when the box doesn’t change
channels after a specific amount
of time (typically four hours) but
TV season is over so they can
watch all the episodes in a single
sitting, either stored on a DVR or
downloaded from a site such as
Hulu or Netflix, and the latter
doesn’t carry advertising.
The biggest challenge,
however, is that the vast majority
of viewing data being collected is
flawed or lacking criteria that
most advertisers deem essential.
this may undercount certain
channels such as those that cater
to business news and children’s
programming. The biggest flaw is
that neither server logs or set-top
box data can measure how many
individuals may be watching a
screen and their demographics…
and advertisers rarely buy
households, they buy specific
demographics.
Larry Gerbrandt
[email protected] has been a
media analyst for more than 25 years
with companies such as Kagan and
Nielsen. He is a principal at Media
Valuation Partners, which provides
strategic consulting, research, valuation and expert witness
services and is a managing director of Janas Consulting,
which provides management consulting, valuation and
investment banking services.
Throughout most of
television’s history, the viewing
data collected by companies such
as Nielsen from a national sample
of households has been adequate
for the largest networks or the
leading broadcasters in the largest
markets. The splintering of
viewing over the last decade,
driven by the proliferation of
digital technologies, has been
steadily eroding the accuracy of
the data. Part of the solution is to
expand the size of the sample and
to include a wider array of
viewing devices, but that comes at
considerable expense at a time
when advertising revenues are
under pressure (a recent survey
by Advertising Age of 61 returning
US prime time series showed 37
had suffered declines of as much
as 51% in 30-second unit prices).
A major initiative is underway
in the US, led by Nielsen, to track
viewing of television series across
devices for up to thirty days after
being premiered, as long as the
shows are digitally tagged with
the appropriate programme
metadata. The new reporting will
also include the demographic data
on which most media buys are
based.
This may fill in some of the
growing holes in viewing of the
most popular TV series on the
largest networks but the bigger
challenge is the hundreds of SVoD
channels springing up on web
and viewable through webconnected TV sets. Though the
most popular of those channels
are subscription-based (such as
Netflix), the bigger challenge lies
ahead: measuring and
monetising micro-audiences that
cumulatively are becoming a
statistically significant force in
the future of the medium.
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