At an Oct. 16 meeting, Nielsen will open a conversation with clients, hoping it will help content owners figure out how to gain real compensation for the material they make available online and to mobile devices. And crucially for the measurement outfit, it also wants to make sure it remains at the forefront of the effort.
Nielsen is convening 75 top clients to get ahead of measurement issues that are going to come crashing down swiftly as audience authentication initiatives like TV Everywhere and OnDemand Online begin rolling out nationally. The optimistic time frame for pay-TV companies to begin authenticating subscribers across the nation is summer 2010. Of course, Hulu is already there, but competitors and some industry observers argue that while the video site has been a success at drawing audience, it operates without a viable long-term business model.
With the divergent needs of the industry in mind, Nielsen plans to present its wares and listen to how the industry would like to proceed in melding TV and online video measurement. “Nielsen is measuring three screens, but they have to come up with a combined product that meets the industry’s needs and they want to get out in front of it,” says one senior research executive.
Nielsen wants to figure out the best way to move forward with the creation of a single-source measurement service that would give TV companies credit regardless of where their shows are watched, from mobile phones to online devices to TV. The plan is reminiscent of discussions Nielsen held in 2006 to add DVR usage to its national household sample. Nielsen currently tracks TV viewing habits in 18,000 households; 375 of those homes in the national people meter panel are also equipped with an Internet meter to track video viewing online.
“We’re careful not to take any actions that would dilute the reliability of the core TV ratings data,” reads a letter sent to its clients by Nielsen. The company plans to install the Internet meter widely starting this year, with “complete installation in 2010 and full implementation in early 2011.”
As ever, not everyone has the same agenda and there is a list of tricky problems to think through. Many of the participants in the TV Everywhere and Comcast initiatives think the way to preserve their business model and TV ad dollars is to air exactly the same ads that run on TV and gain a C3 rating (the current TV currency). Hulu and Google’s YouTube are already well into a model that eschews 15 minutes of ads per hour of programming in favor of higher-cost ad formats such as pre-roll that are seen as more engaging. Hulu might also want its numbers counted as currency, but that would entail Nielsen changing its rules.
Advertisers, also expected at the Nielsen meeting—which will take place at the Harvard Club in New York, starting at 2 p.m.—have complex software that they use to plan TV buys. They want to employ the software cross-platform to gain what could be called a “video rating” in place of a TV rating, greatly simplifying their research and the deluge of contradictory video viewing data in the marketplace.
Speed is of the essence, and the stakes are high. If online viewership of traditional TV continues to expand rapidly, TV executives could be swapping the proverbial traditional TV ad dollars for digital dimes.
But not everyone is on board. Some sports network executives, for instance, see little need to move forward. They may see limited benefit in adding online viewing to TV ratings since sports events are watched mainly live on TV sets and online access is tightly restricted.
One difficulty is that if ad loads that run on TV are the same as those online, what ads does library content carry? Another research executive suggests that library material might carry the same ads as the current episode of a drama.
A further issue up for debate is the scope of what Nielsen might include in its online viewing measurements. Would Nielsen simply track what its panelists are watching at NBC.com or ABC.com and add that into the TV rating; or would it count people watching clips of Letterman on YouTube or any of CBS’ syndicated material available at any number of places around the Web, including Yahoo?
“Different content providers have different perspectives on the potential of online and mobile as a distribution source,” explains one executive who will attend the Nielsen meeting. “Critical to our monetization effort is the ability to measure the audience that’s accumulated over those screens. Right now, there’s no measurement system to provide accumulated audiences. That’s a major initiative for the industry, and Nielsen wants to get out in front of it.”
Of course, Nielsen isn’t the only outfit attempting to answer such tricky questions. Fourteen founding members of the Coalition for Innovative Media Measurement (CIMM), including a slew of major industry players such as NBC Universal and CBS Corp., are seeking ideas from a wide range of measurement services with the aim of finding the most effective solutions for moving the industry forward. The group is expected to issue requests for proposals (RFPs) in the coming weeks.