DVR Measurement Hangs in Balance

Feb 28, 2005  •  Post A Comment

Nielsen Media Research’s decision to delay data about digital video recorder viewing and its surprising plans to fund an outside research and development project have agency and network executives responding two ways: with head-scratching and with relief.

“How it will affect us is all unknown,” said Jack Wakshlag, chief research officer for Turner Broadcasting System. “It depends [on] how we negotiate through this process.”

Of immediate concern is how advertisers will plan TV media buys for the 2005-06 upfront market with regard to DVR viewing data. That’s because in January 2006, the middle of the next broadcast season, Nielsen will start filtering anywhere from 600 to 1,000 homes equipped with DVRs into its almost 8,000-home sample. Originally, Nielsen was going to start that process in September 2005, at the beginning of the 2005-06 broadcast season.

All this is giving media agency research executives headaches.

“It’s getting harder because the methodology changes [don’t] allow for apples-to-apples comparison,” said Lyle Schwartz, senior VP and director of media research for Mediaedge:cia, New York. “Still, it’s incumbent on us to accurately project what we think is going to happen, because it does have an impact on the marketplace pricing-even if it’s a rough estimate.”

DVRs are in about 4 percent to 6 percent of U.S. TV households, representing anywhere from 4 million to 6 million homes. Though that number is small, industry experts said minor adjustments in Nielsen’s methodology can mean big changes for programs such as those on cable that live or die on just a matter of tens of thousands of viewers.

“Right now small changes for a TV program-a tenth of a rating point-can mean the difference between success or failure,” said Mediaedge’s Mr. Schwartz.

TV measurement issues are so difficult that one senior network television research executive, asked by his top management about his five-year viewership projection, had only one response: “I don’t know-I can’t compare apples and oranges.”

That’s because there are no measurement sources available other than Nielsen, a company that has had its share of struggles recently with such issues as the underreporting of minority viewers and the lack of capability to measure new technologies.

For all TV programs, Nielsen originally plans to offer clients three different streams of data. The first is live data, which is regular TV program ratings. The second is live-plus-seven-day data, which includes DVR viewing of a program up to seven days after its scheduled airing. The third, arguably the most important, is live-plus-same-day viewing, which covers DVR viewing of programs on the same day they are telecast. Research shows most DVR homes view recorded programs on the day they are recorded.

Hitting Rewind

Why does that matter? Mr. Wakshlag pointed to the 2004 Super Bowl ratings and what they would look like just after the halftime presentation in which Janet Jackson’s breast was exposed. “All of a sudden a lot of homes are rewinding,” he said. “Pure live ratings would suddenly drop. But then they would climb back up when viewers fast-forwarded back to the live airing.” The live-plus-same-day viewing data would account for those viewers who stopped to rewind.

Betsy Frank, executive VP of research and planning for Viacom Cable Networks, Film and Publishing, said, “Just like the overnights [the national Nielsen ratings], the same-day data is important [to see immediately], rather than waiting seven days for the final ratings. It helps us to program, schedule and market.”

Nielsen will start releasing local station DVR data in April 2005.

A midseason start of the national DVR data is somewhat good news because researchers can compare first-quarter 2006 data with non-DVR fourth-quarter 2005 ratings data, Ms. Frank said.

In an unusual move, Nielsen also announced it will start a $2.5 million re-search and development effort to examine wide-ranging issues. An outside panel of experts will run the R&D effort.

Media research executives said Nielsen’s move is in response to an Advertising Research Foundation meeting in New York some weeks ago during which media executives essentially said Nielsen’s U.S. consumer satisfaction performance is well below that of European customers with the TV research systems in Europe.

“That is what underlies the frustration of the [ARF] meeting,” said Alan Wurtzel, president of research and media development for NBC Universal. “They weren’t talking about ratings; they were talking about service -the quality of the software, the analytical capability and core things, like sampling. For the first time there was a real feeling we weren’t being served well. The real concern, in a much more complicated and challenging media environment: Is Nielsen up to the task? I take them at their word.”

“Clients have research questions they want addressed,” said Paul Donato, chief research officer of Nielsen Media Research. “They have significant influence. It’s a way of empowering clients.”

Researchers said Nielsen’s R&D project is part of an effort to explore a system giving networks and advertisers more involvement in the creation and technical aspects of new re-search methodology.

Overall Mr. Wurtzel and other executives were pleased with Nielsen’s efforts. But many are holding back a full endorsement. “Nielsen is headed in a right direction,” Mr. Wakshlag said, “but this really took a long time. I would like to see them be a bit nimbler.”