The Problem With Nielsen's Ratings System
Set Meters and Viewer Diaries Are Flawed Ratings Measurement Tools
Oct 11, 2009
Television makes its money from advertising. Companies have to pay so much to have commercials air during the various programs broadcast into our homes. More popular shows have a higher price tag, obviously, because the ads are reaching more people. But how can advertisers be sure which shows will reach the most viewers, and how can television companies be sure how much to charge for air time? This is where Nielsen Ratings come in. For sixty years Nielsen Ratings has measured audience viewing habits and provided this necessary information to television companies. But as technology and viewing habits have changed, it might be time for Nielsen to undergo a major makeover.
A Brief Look At Nielsen
Nielsen Media Research was founded in the 1920's by Arthur Nielsen. He started as a market analyst who transitioned to radio and then television as those technologies entered the cultural landscape. Today, Nielsen uses two forms of measurement to collect data, both which involve audience members voluntarily taking part in the survey.
- Viewer Diaries - Viewer Diaries require the audience member taking part in the process to manually keep track of their viewing habits. They keep a journal detailing what shows they watch, which channels they are on, and what time they are watching them.
- Set Meters - Set Meters are devices that hook up directly to the television in a participant's home. These units transmit information directly to Nielsen. It can detect what is being watched, and can even determine the exact moment a channel is changed. Overall, it is a much more accurate reading than the Viewer Diaries.
New Ways to Watch
There are a few problems with the way Nielsen gathers its data. The most obvious flaw is exclusive to the Viewer Diaries approach. Because participants are aware they are taking part in a survey, the results can be biased towards the shows they like, regardless of what was actually on the television. It it also easy for participants to forget to include entries by mistake. The introduction of the Set Meters has helped to correct these shortcomings.
Unfortunately, the Set Meter has its own set of flaws. Over the past few years, the viewing habits of many television watchers has changed. When TiVo and DVR were introduced to the market, Nielsen was slow in including what people recorded to watch at a later time in their reports. It was big market that at the time was being ignored.
The same is happening now with the internet. More and more viewers are using their computer to watch their favorite television programs. Most channels offer online viewing on their websites, and streaming sites such as Hulu.com have grown in popularity. As more and more people watch shows via the internet, more and more shows are being watched outside of the gaze of Nielsen. This is problematic considering that shows are dependent upon high ratings in order to stay in business. A show with fairly low ratings could actually have a huge online viewership. And since the websites sell ad space on their pages and show commercials before the video begins streaming, it is just as important to the business structure of television as what is being broadcast.
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In order to accurately report on how many people are watching any given show, Nielsen must include new forms of measurement that will take alternate forms of viewing into account. More and more people are turning to these alternate means, and not counting them will create a serious gap between what the reports say is being watched, and what really is. Including them, however, will produce a much more accurate picture of television viewership that will prove crucial to the television market.
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