Nielsen faces a ratings battle

News that a host of companies may unite to create a new TV and media ratings service felt like an old story to St. Petersburg entrepreneur Frank Maggio.

That's because Maggio spent more than $10 million developing his own ratings system in 2006, directly taking on the corporation which dominates the TV ratings game, the Nielsen Co.

The new effort, according to a report published in the Financial Times Friday, will cut across major lines in the media industry — including broadcasters such as CBS, NBC and Fox owner News Corp.; cable companies such as Time Warner and AT&T; cable channels such as Discovery, Viacom and Disney and advertisers such as Procter & Gamble.

The idea is to create a system for measuring viewership using data from cable set-top boxes that includes traditional TV watching and digital sources. Which is exactly what Maggio tried to do years ago — even suggesting a plan for buying Nielsen and replacing its system with data collected from cable set-top boxes and smaller surveys.

The competition brings special interest locally, because Nielsen operates a huge data collection facility in Oldsmar employing many hundreds of people.

"The bottom line, is there should not be a single provider of ratings — particularly in an industry as large and varied as television," said Maggio.

He tried to develop a company to present a gaming channel on cable TV using a new ratings system for more precise viewership data. But when cable companies declined to provide the anonymous viewership data he needed, his effort failed.

Now Maggio notes the consortium members the Financial Times identified included major players in almost every stage of the TV industry, from broadcast networks to advertisers, cable companies and media buying companies.

At the very least, the project may be a shot across the bow of the Nielsen Co., which has faced a growing chorus of complaints from customers about incorrect or late ratings reports. "Some people say, if you want better TV ratings, you sue Nielsen," Maggio said. "That's only something you say when you're facing a monopoly."

Back in May, Nielsen cited "server issues" as the cause for a delay which kept customers from getting ratings data for days. Earlier this year, Miami-based Sunbeam Television filed a lawsuit against Nielsen alleging a new measurement system implemented there cut viewership figures for WSVN-TV in half.

Representatives for Fox, NBC and CBS declined to comment on the Financial Times reporting. Likewise, Nielsen director of corporate media relations Marisa Grimes said, "It's all speculation now. The only thing I can say on the record is that we don't have a comment on speculation."

Maggio isn't the only upstart to challenge Nielsen. Radio ratings service Arbitron's attempts to develop a TV ratings service ended in 1992 when the company couldn't sign up enough big industry players.

Critics note that having companies which sell TV advertising involved in creating the ratings used to value those commercial spots may be like asking a fox to guard a hen house. But Maggio, who settled a lawsuit with Nielsen last year, said the TV ratings company's monopoly on the industry has allowed long term problems to grow into serious issues as advertisers seek new outlets.

"Both Nielsen and TV networks are paying the price for not having competition sooner," he said. "Advertisers have no faith in their ratings. When times are tight, where do you put your money? Somewhere where there's more accountability."

Times staff writer Michael Kruse and Times researcher Shirl Kennedy contributed to this report. Eric Deggans can be reached at (727) 893-8521 or deggans@sptimes.com. See his blog at blogs.tampabay.com/media.

Nielsen faces a ratings battle 08/14/09 [Last modified: Friday, August 14, 2009 11:00pm]

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