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Local Nielsens Back in Tussle

Mar 24, 2003  •  Post A Comment

The tug of war between cable and broadcast over the Nielsen numbers and what they mean for local-market advertisers continued last week with the latest analysis from the Television Bureau of Advertising, a broadcast trade organization, of what it calls “alternate delivery systems,” by which the TVB refers primarily to the satellite delivery of national cable networks.
According to the TVB’s analysis of Nielsen’s data, “national ADS penetration reached 16.7 percent in February 2003, up from 14.7 percent in February 2002,” with the direct broadcast satellite component of DBS estimated at “15.6 percent, up from 13.2 percent in November 2001.”
The TVB also contends that “over the same period, wired cable penetration fell from 70.3 percent to 68.6 percent-the last time wired cable was that low was in August 1996.”
What makes the growth of ADS significant, said Susan Cuccinello, the TVB’s senior VP, research, is that, “While a local broadcast commercial is seen by a viewer whether he or she is watching that station over wired cable or satellite, there is no local insertion in national cable programming in homes watching via ADS. Local advertisers need to deduct the ADS percentage of the audience if [it is] included in the cable systems’ submissions.”
Moreover, according to the TVB, 51 television markets now have ADS penetration of 25 percent or more.
The TVB represents broadcast stations and groups, while the Cabletelevision Advertising Bureau, its opposite number, represents advertising-supported cable networks and system operators. Broadly speaking, the two competing organizations see their respective memberships as locked in battle with each other for viewers and advertising dollars.
Last year, Joe Ostrow, the head of the CAB, denied that ADS was an issue for advertisers. Mr. Ostrow, who is retiring from the CAB at the end of this month, cited Personal People Meter test data in Boston showing that the local cable audience increases with the new ratings measurement device. In Nielsen’s traditional diary-based system, errors in local audience measurement actually favored local broadcasters at cable’s expense, Mr. Ostrow said. As for the specific contention that local cable operators bundle their ratings with DBS, “cable operators do not do that,” Mr. Ostrow said. “It is frowned upon and it is not done.”
A CAB spokesman said the organization stood by Mr. Ostrow’s earlier remarks. “For advertisers, delivery is much more important than penetration, and cable’s delivery is at an all-time high. That’s what’s key,” the spokesman said.
Christopher Rohrs, who heads the TVB, said that in 2002 ADS could potentially have resulted in overpayments by advertisers of as much as $700 million. The TVB also estimated that as much as $555 million was potentially lost to ADS overpayments in 2001.
However, the actual-rather than the potential-extent of the ADS overpayment problem depends on how many agencies do not make the ADS adjustment. “It’s fair to say that agencies are beginning to make that [ADS] adjustment,” said Mr. Rohrs, who estimated, however, that “more than half of all agencies” that do local cable advertising do not adjust for ADS.
Last year, Nielsen Media Research announced it would begin publishing cable numbers in late 2003 in their component parts, wired and ADS, but until the change-over, advertisers need to make ADS deductions manually, according to the TVB.
Nielsen does plan to begin breaking out those ADS numbers later this year, “We’re on schedule to begin reporting that data in the fall of this year, probably in October. That’s our intent,” a Nielsen spokesman said. “We’ve communicated that to the TVB.”
The expectation is that, beginning in the fall, Nielsen’s local books will include an ADS penetration chart.
When that happens, said Mr. Rohrs, the ADS problem “will go away.”