Key U.S. Senator Wants Federal Government Involvement in Media Ratings

Proposed legislation Aims at
Nielsen People Meter System

July 28, 2005      By: Ira Teinowitz

WASHINGTON (AdAge.com) -- A key senator on the Commerce Committee yesterday
said he would push ahead with legislation that would effectively make the federal government a regulator of media ratings accuracy.

“We are going to move. ... We are going to move forward on the legislation,” said Sen. Conrad Burns, R-Mont., after a hearing of the Senate Commerce Committee “It may change in form a little [but] Nielsen needs some kind of effective oversight.”

Mr. Burns referred to Nielsen Media Research, a unit of VNU, which for years has supplied networks, media buys and advertisers with ratings of most consumed media. Nielsen is looking to replace its current paper-based method of tracking audience viewership with an electronic system known as the local people meter in major markets.

Divisive technology
The local people meters have been divisive, scorned by the larger broadcast companies such as Fox Broadcasting Co., Tribune Broadcasting Co. and Gannett Co., while praised by the ad industry and smaller broadcasters for providing quicker local ratings and more audience data.

Mr. Burns' legislation, which is supported by Fox, requires TV ratings systems to be accredited before they are used. The bill would give the Media Rating Council, a private, nonprofit industry association established to ensure that measurement services are valid, a government role in conducting the accreditation.

Fox has been upset with Nielsen’s introduction of local people meters, arguing the technology undercounts minority viewers and shouldn’t be used until its accredited by the MRC. The complaining broadcasters allege Nielsen is in a rush to “monetize” people meters and have called on Congress to ensure Nielsen acts in the public interest, claiming the new meters undercount minority viewers in major markets, such as New York and Los Angeles.

FTC keeps out of debate
The Federal Trade Commission in April said it will not get involved with or monitor Nielsen
Media Research's rollout of the new measuring system. The FTC said the best approach to any monitoring problems is a voluntary one through the Media Ratings Council. Nielsen has been working with the council since launching the system in Los Angeles last year.

Ad groups and media buyers, who have been largely on the sidelines, are now warning against government involvement, claiming the legislation could seriously damage ratings, delay improvements and prevent new competition. They also say any problems are better handled by private industry negotiations.

All those views came out in yesterday's hearing, which also had some elements of theater as both sides rushed out packets of information and dueling minority ministers -- the Rev. Jesse Jackson on behalf of Nielsen, and the Rev. Jacques DeGraff, pastor of New York’s Canaan Baptist Church, for the Don’t Count Us Out Coalition, which was formed to oppose the local people meters.

Advertisers have been waiting
“Advertisers have been waiting for 15 years to get daily ratings,” said Kathy Crawford, president of local broadcast for WPP Group's MindShare.

“I am very concerned that this bill will make it harder for clients to buy advertising with any confidence that they are spending their money wisely [and] will turn back the clock on the progress we have made in developing an effective TV ratings system.”

She also complained that the legislation gives too much authority to the Media Ratings Council, whose voting procedures, she said, needs “to be seriously overhauled.”

Pat Mullen, CEO of Tribune Broadcasting, complained that after Nielsen introduced people meters in New York, it rolled them out in Philadelphia and Washington before rectifying problems showing up in New York.

“In the absence of competition, we are left to plead for fair treatment and reliable results. Time and time again, Nielsen has turned us away,” he said. “The keys to our success—our ratings—are held by a monopoly.”

Nielsen's president-CEO, Susan Whiting, said Nielsen has agreed that additional people meter markets audits will be completed before the switch from the old paper method to the new technology is made.

Don't slow ratings innovation
“Given the progress we have made and the inherent conflicts within the industry, we do not believe legislation is necessary or advisable. In fact, we feel it is unwarranted and harmful,” she said. It “would slow ratings innovation to a crawl. Vital new systems for measuring all forms of digital television could remain idle while MRC members debated.”

Mr. Burns, for his part, said his proposed legislation has produced some of its desired effect in getting both sides to work closer together and suggested at one point that he would still prefer voluntary industry moves.