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Nielsen: SVOD Eroding Traditional TV-Watching Audience

13 Nov, 2014 By: Erik Gruenwedel

Ratings agency calls on industry to adopt new measurement standards in the face of accelerated declines in traditional live-TV ratings

It’s official. Netflix and other subscription streaming devices are indeed television disruptors — no matter how much traditional media publicly denies it.

A Nielsen executive Nov. 13 posted a in response to growing concerns within in the multichannel video program distribution landscape that TV audiences are watching increasingly less live programing.

The venerable ratings institution has come under increased scrutiny this year as traditional TV ratings, including upgraded C3/C7 ratings (to capture viewing three-to-seven days after initial broadcast) for national TV programs, have failed to properly track audience data.

And more importantly, advertisers are scaling back their spending in response.

“Today, consumers have more control than ever before — and media companies are being forced to adapt to the new realities of what people watch, and when they watch it,” Megan Clarken, EVP of global watch product leadership for Nielsen, wrote in the post.

Clarken reiterated what most industry observers already know, but few media executives have accepted: That the growing penetration of new devices and the popularity of subscription streaming services, on-demand and over-the-top viewing options — as well as cord-cutting and cord-shaving — are fundamentally changing the TV industry.

At the same time, Nielsen said renewed efforts to capture viewing habits on portable devices such as tablets and C3/C7 have failed to account for the fact that increasing numbers of viewers watch TV content via different (non-C3/C7) devices, including connected TVs and streaming media devices such as Apple TV, Roku, Google Chromecast, Amazon Fire TV and gaming consoles, among others.

Clarken said the growing shift of audiences is primarily due to time-shifted digital content, including SVOD — which is not included in the current TV ratings under industry definitions.

“We believe that the fundamental changes occurring in today’s viewing landscape call for the industry to adopt a new set of ratings standards,” she wrote.

Specifically, Clarken advocates the industry must track the “total audience,” which combines the entire viewing audience for a program or content regardless of the mode of access, including SVOD. In addition, she said the measurement must include ratings for an ad campaign regardless of where and how it’s consumed, providing flexibility for dynamic ad insertion — the latter a norm at Hulu and Hulu Plus.

Notably, Clarken doesn’t address the nagging reality that both Netflix and Amazon Prime Instant Video do not run ads of any kind in their programing. Nor do they divulge viewing data. Without either, there’s nothing to track or sell.

TV disruptors indeed.


About the Author: Erik Gruenwedel

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