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Cable Technology Feature Article

February 25, 2013

Nielsen Expands TV Ratings to Broadband Viewing

By Tara Seals, TMCnet Contributor

You know broadband TV has arrived when the Big Kahuna of measurement adds non-traditional video viewing to its ratings mix. Nielsen has decided to, in September, start keeping tabs on how many people watch TV via a broadband connection—be it connected TVs, Xbox and other gaming consoles or iPads and tablets.

Nielsen said the number of homes without traditional TV service (cable, satellite or IPTV (News - Alert)) is around 4.2 percent — a number that’s on an upward trend. That’s statistically significant enough to start measuring whether broadband TV has filled the gap—i.e. whether so-called cord-cutting is actually happening. But the measurement will also be elucidating when it comes to supplemental viewing habits, with some in the household viewing broadcast content through traditional means, and others using alternate networks to stream content.

According to Brian Fuhrer, senior vice president at Nielsen, the move will add around 160 homes to Nielsen’s current sample of 23,000 metered houses nationwide. However, the company also is adding new measurements within each household, to the tune of about 2,000 more broadband sets.

 “Consumers are accessing content in new ways that fall outside of our traditional definitions and if we don’t expand ... we could be missing an emerging trend,” he told Washington Post.

The new strategy will give advertisers some visibility into how people are watching, but not necessarily what. True ratings data will remain elusive for the time being, thanks to the fact that over the top (OTT) services have their own encoding mechanisms. Absent a standardized encoding approach, as there is in broadcast, Nielsen will have a much harder time gathering granular information, the Hollywood Reporter points out. Thus, it won’t know how many people are, say, watching Girls via HBO GO.

Nonetheless, advertisers (and the industry as a whole) will benefit from knowing how much time is spent viewing video via a broadband connection and who within the household is leading that consumption charge. Studies have shown that broadband TV viewing is disproportionately skewed to the younger demographic, which is a more valuable cohort to advertisers. In some ways, this new measurement wrinkle hast the ability to shift the monetization model for online video.

Over time, networks have seen the median age of viewers increase, according to Brad Adgate, top researcher for Horizon Media, as reported in the Post. Meanwhile, younger viewers have dropped off Nielsen’s radar, he said, as they are more likely to turn to broadband for video content.

Nielsen’s plan also stakes out territory in online measurement, which already tells us the total number of people watching video via the Web. The comScore (News - Alert) Video Metrix round-up for January 2013, for instance, shows that nearly 180 million U.S. Internet users watched 36.2 billion online content videos, as well as 9.1 billion ad views.

Overall, 83.5 percent of the audience viewed online video, and the duration of the average online content video was 5.7 minutes, while the average online video ad was 0.4 minutes. Video ads accounted for just over a fifth of all videos viewed and 1.7 percent of all minutes spent viewing video online. By contrast, in December 2012 ads accounted for 22.6 percent of all videos viewed and 1.9 percent of all minutes spent viewing video online.

Edited by Rachel Ramsey

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