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Nielsen Ratings System Goes Digital

NEW YORK -- Nielsen Media Research said Wednesday that it would integrate TV and Internet measurement, add ratings for viewing on such portable devices as cell phones and iPods, and gave a firm date of 2011 for the end of paper diaries in even the smallest markets.

The scope of Wednesday's news stunned many in the media industry, who had for years told Nielsen that it moved too slow in reacting to the changes in the TV business. It also came months after Nielsen told Arbitron that it wouldn't go ahead with the joint venture involving Arbitron's Portable People Meter technology. While many in the industry wanted to make sure Nielsen could deliver on its new promises, the company was universally praised for its action.

"It's a very bold statement of intent," said Richard Fielding, vp/research director at Chicago-based Starcom.

Nielsen's multifaceted approach will begin to answer many of the questions that are swirling around the industry these days, which is being reinvented around the digital revolution in video. One of the most intriguing is the integration of TV and online measurement, by tracking video programming delivered on the Web through its Nielsen//NetRatings unit, and adding the Internet to its People Meter sample that will give the industry what could be its first comprehensive look at viewing on TV and broadband.

Nielsen also is developing meters that track viewing on portable devices, and will by year's end have a 400-member iPod user panel in place. That, along with the television and Internet measurements, could provide a revolutionary look at the impact of iPod downloads or streaming video on overall television viewing. It's the type of data that is now just speculation.

"For the first time, we will know who's being exposed (to the media) and to what extent they are being exposed," ESPN senior vp research and sales development Artie Bulgrin said. "Does the download make it from the computer to the mobile device, and when does it make it, is that person consuming and watching it and for how long?"

That is a key issue these days because the data currently available is transactional: How many downloads, not how it was viewed. This and other Nielsen proposals will add to the industry's understanding of media consumption, said Brad Adgate, senior vp research at New York-based ad buyer Horizon Media.

"What marketers really want is some sort of single source measurement, to find out what a day in the life of a media consumer is: What they're watching on cell phones, what they are watching on iPods, what they are watching on linear TV and when they are watching," Adgate said.

Nielsen will expand Local People Meters to the top 25 markets and by 2011 will phase out the paper diaries with several types of electronic devices from active/passive meters that aren't wired into the TV set to battery-powered meters and maybe even wearable tags that would be able to tell when their owners are near the TV.

"Television is becoming a more personal medium, and television advertising is bought and sold on a personal basis," said Paul Donato, senior vp/chief research officer at Nielsen Media Research. He said Nielsen has spent the past year working with clients to determine their needs, and that Wednesday's plan was the result of those discussions.

Nielsen also made happier those who had been concerned about the lack of out-of-home viewing in the sample. While Nielsen this year had said that it would count some college student viewing, Wednesday's proposal goes even further, adding it to the People Meter samples by the end of 2008 and eventually adding it to the currencies. Nielsen will do this by one of two methods of capturing programs' audio signatures, one inside a cell phone and the other in an MP3-size device.

Bulgrin, who for years has strongly advocated the measurement of out-of-home viewing, said Wednesday that he felt Nielsen's proposals were a step in the right direction that would benefit ESPN and other networks who have significant amounts of viewing in bars, doctor's offices, college campuses, the workplace and elsewhere.

Nielsen also threw its hat into the ring of the media industry's latest hot topic, engagement. It's undertaking a test under the supervision of some of its clients that involves asking households leaving the People Meter sample to continue in a separate panel with meters to determine commercial recall and other measures.

It is a potentially risky course for Nielsen because no one seems to be able to capture the concept of engagement in a single definition. Nielsen's Donato acknowledged this and said that it wouldn't attempt to define it but perhaps in the future offer products that help agencies and networks measure it better.

"People don't know what engagement is right now, I don't think," Horizon's Adgate said. "What we call engagement in 2006 may not be what we call engagement in 2011. It's really a moving target right now."

Bulgrin also thinks engagement is too complicated to have an easy answer.

"I think there are components to measuring engagement that they can provide and make more turnkey to the industry, but the emotional side of engagement perhaps depends on what network you speak to," Bulgrin said. "There are different recipes and different solutions."

While Nielsen has got generally good reviews for its proposal on first blush, many in the industry want to see how it is implemented before gushing with admiration. Starcom's Fielding said Nielsen had been criticized for dragging its heels as the industry has been asking for solutions to these challenges.

"I think it's Nielsen finally reacting to the reality that it's not television per se, it's video," Fielding said. "Nielsen was also feeling increasingly threatened in its core business, a panel-based smaller sample."

Nielsen is owned by Valcon Acquisition B.V., parent company of The Hollywood Reporter.


Paul J. Gough writes for The Hollywood Reporter.

For more news from The Hollywood Reporter, click here.

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