While media buyers blast Nielsen for wanting to switch to live-plus-same-day ratings, broadcasters say the new scheme promises to show that their audience is larger than what they are currently getting credit for and that, ultimately, should lead to more revenue. The reason live-only is unfair, they say, is that it doesn’t count viewers who use DVRs sparingly.
On behalf of the 4As Media Policy Committee, Marc Goldstein sent one doozy of a letter to Nielsen last week, blasting away at its decision to make the live-plus-same-day rating the standard audience measure for local and national spot starting Jan. 1.
Goldstein, who doubles as CEO of Group M, demands that Nielsen restore live ratings in his Nov. 18 letter. “Your total disregard for the expressed concerns of local broadcast media buyers, coupled with your adamant refusal to recognize our point of view is totally unacceptable,” he wrote.
According to MediaDailyNews, GroupM is also contemplating legal action. Yikes.
In an open letter to Goldstein, Nielsen’s Sara Erichson defends the decision. “The only side we have taken is one in favor of best depicting contemporary viewing behavior,” she says.
So, where are the broadcasters in this controversy? After all, they’re the ones who stand to gain from the new metric, which would replace the current live-only rating and for the first time give stations credit for time-shifted viewing on DVRs.
According to some estimates, primetime ratings could rise as much as 13 percent. That’s money in the bank for stressed broadcasters.
From what I gather, broadcasters are playing it cool, staying out of the fray and hoping the media buyers come around and accept the live-plus-same-day standard next year.
“The dialog will have to continue,” says TVB President Chris Rohrs. “I think everybody would agree that a consensus currency is in everybody’s interest. It’s just a lot better way to do business. It makes the marketplace more orderly and effective for everyone — buyers and sellers.”
Broadcasters aren’t completely satisfied with live-plus-same-day either, Rohrs points out. They would have preferred live-plus-three-days so that the rating captures more of the time-shifted viewing.
But when Nielsen began focusing on live-plus-same-day in its deliberations, he says, “we accepted and supported that as a compromise metric because we believed it to be the best possible choice — the most accurate and fairest representative of viewing in a DVR world.”
In the best of all possible worlds, Nielsen would have adopted the same so-called C3 metric that is now used in the buying and selling of network time. But that involves measuring the viewership of actual commercials over three days and doing that at the station level is beyond Nielsen’s capability right now.
“Local has no path to C3,” Rohrs says. “It’s not technically feasible.”
Like Rohrs, broadcasters and their reps are willing to accept live-plus-same-day as a compromise.
“A large percentage of DVR viewers do not skip commercials, and this audience has value,” says Val Napolitano, president-CEO of Petry Television. “There is DVR viewing within live-plus-seven-day, and we get no credit for that. The buy-sell process will ultimately determine what the aggregated value is.”
Live-plus-same-day is the least broadcasters deserve, says one TV station group executive. “Broadcasters wanted live-plus-seven, or at least live-plus-three,” she says. “Only 63 percent of viewing is done in the first day a show is recorded. The viewers that we’re losing are phenomenal.”
The reason live-only is unfair is that it doesn’t count viewers who use DVR sparingly, says another station rep. “It’s the elephant in the room.”
In the live-only scenario, if someone views The Oprah Winfrey Show as it is being aired, and pauses his DVR for more than 25 seconds to control his sobs upon learning the show is ending, then resumes playing, he’s eliminated from the live-viewing-only count. I confirmed that “rule” with Nielsen’s Karen Gyimesi.
Rino Scanzoni, chief investment officer of GroupM North America, whom I spoke with at the Media Outlook 2010 seminar organized by the Media Financial Management Association just before the Goldstein letter emerged, says that broadcasters ought to be careful for what they wish.
Stations have been battered over the last year with declining cost-per-point rates in the neighborhood of 20 to 30 percent, he says. A move to live-plus-same-day ratings could further depress rates by increasing the supply of rating points.
In other words, if a program garners a 5 rating and the cost is $100, the CPP is $20. If the rating rises to 10, and the price remains the same, the CPP is $10.
But the broadcasters and reps I spoke with don’t seem to worry about rates.
“I don’t personally think that would happen,” says Rohrs. “This is a limited-impact situation. What tends to get shifted is primetime and a somewhat limited group of programs.”
Even though the CPP rates could be negatively affected, others say, they prefer to show advertisers what they consider to be the true value of their programming with the increase in ratings.
The challenge will be to negotiate higher unit rates to counteract the possibility that CPP rates will decline, they say.
Although the broadcasters are staying out of the public dispute over the new ratings, some are exasperated by the buyers’ uncompromising attitude.
“The broadcasters can’t jump into the middle of this,” says the TV station group exec. “There would be no good getting into a fight with the 4As. But I’m personally tired of listening to the 4As on this.”