Nielsen certainly has its share of problems. It is trying to keep up
with the moving target of TV as the delivery system morphs to computers,
cellphones and TiVos. Its ratings system is being overtaken by technology, and
while its local people meter (LPM) is an improvement over the old meter/diary
system, it is obviously still a work in progress.
Despite its woes, neither Nielsen nor the industry needs Washington
stepping in to regulate TV ratings, as it is now threatening to do—and with
the complicity of the National Association of Broadcasters, no less, which has
endorsed a bill that would give the federal government say-so over how ratings
and shares are counted. That's the same NAB, we note, that is allergic to
regulation unless there is political or economic advantage to its members in
Meters have been around for almost two decades in Nielsen's national
sample, but they began running into opposition in 2002, when the ratings giant
began its introduction of LPMs. Those are the ratings on which stations live or
Nielsen could have handled the transition far better. But because it is
a near monopoly in the audience-measurement business, it was slow to respond to
As for the technology, the jury is still out. For starters, there are
reports that many viewers can't figure out how to use LPMs. And even more
fundamental, LPM numbers often show many more viewers watching cable than the
old system did—so the numbers are radically different. Broadcasters,
particularly Fox and Tribune Co., have campaigned against the system, arguing
that Nielsen's not counting right.
But there is no justification for inviting Washington to start mandating
some broadcasting version of fairness and balance in the ratings system. Yet
bills introduced in both the House and Senate would make it law that any
ratings service that wanted to do business in the U.S. should be approved by
the Media Ratings Council first. Not only that, but any change to existing
ratings would also have to pass muster with the MRC.
At a time when advertisers and programmers need a nimble and responsive
system to track our mobile-media society, getting the government involved in
this internal business dispute is folly. In fact, getting the government
involved, even if technology were stagnant, would be folly. Capitol Hill has no
reason to be a referee in the television-ratings business.
Our opposition to government intervention does not mean it should be
business as usual at Nielsen either, a reality we hope the ratings monolith is
at least wise enough to recognize. Its move to pay for audience audits of all
future LPM markets and submit them to the established MRC are steps in the
right direction, as are its efforts to improve the meter's fault rates.
If those measures aren't enough, though, more stations should vote
with their feet and their pocketbooks. In fact, several dozen already have
We think the marketplace can solve this problem. The ratings company
should get better or a new service should emerge to scoop up the hundreds of
millions of dollars that a reliable audience-measurement company could
Indeed, networks or ad agencies could fund their own ratings system,
which would get Nielsen's attention in a heartbeat. But inviting those
trustworthy efficiency experts in Washington to fix television's ratings
problems is an absurd solution.