Nielsen Over-Reports Small Cable Nets’ Coverage Areas

Nielsen has faced a couple of months’ worth of occasional reports of glitches in the company’s measurement systems that have caused over- or under-reporting of audiences.

The most recent is a miscalculation concerning household coverage of small cable networks on satellite distributors, which might have caused more advertising money to go to those networks than they deserved, according to MediaPost.

Nielsen didn’t name the 20 or so small networks that got higher-than-deserved coverage areas, which could have caused them to sell more viewers to advertisers. The official line from Nielsen was that, “Our field procedures, which require manual assessment of channels received, were not followed in all cases in DBS homes.”

Nielsen claims it cannot keep up with the multiple new networks on satellite distributors. “Given the rapid growth and the increase in the number of packages and channels available, this process no longer provides the necessary level of reliability to accurately define household channel receivability,” the company said.

Back in January, Nielsen reported a glitch with its A/P (active/passive) coding system. The glitch happened during several New England Patriots games, causing two TV stations to under-report ratings.

About the problem, Nielsen said, “In evaluating ratings for the December 3, 2007, October 1, 2007 and October 30, 2006 New England Patriots games carried on WCVB, WMUR and ESPN Network, determined that a technical problem existed with the stations’ encoding equipment.” It was the second time since in as many months that Nielsen reported a glitch with its A/P coding system. The system was purposely designed to be redundant so such problems could not happen in the ratings process.

Despite indications that both buyers and sellers of television have become increasingly frustrated with Nielsen’s measurement processes, the company has consistently been able to fend off competitive challenges from others, such as Arbitron, AGB, R.D. Percy & Co. and SMART, who have hoped to enter the television measurement arena.

The most recent success is the settlement of erinMedia’s antitrust suit against Nielsen Media Research, another MediaPost article reports. Terms of the settlement are not known, but it seems that erinMedia did not receive the kind of relief that would have forced Nielsen to alter its business agreements with the major television networks - which would have made it easier for other competitors to enter the marketplace.

The settlement suggests that the only true competition facing Nielsen at the moment is TNS Media Research and Google, which is trying to gain access to digital set-top data in order to measure TV viewer behavior. Nielsen is also experimenting with gathering data via set-top boxes.

ErinMedia was suing Nielsen for false advertising and unfair trade practices.