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The Ratings Game

On a recent episode of the public radio show This American Life, Alex Blumberg discussed how, growing up, he always assumed that the Nielsen Ratings – the ratings used to measure television viewership – got their name from the fact that all of the viewers sampled shared the last name Nielsen.

"I think I'd figured [as a child] that they'd done some research and found that the name Nielsen, because it was a common name maybe, that seemed to cut across class and economic lines, actually came pretty close to a representative sample," he said. Twenty years later, he was speaking to someone who said her friend had been selected as a Nielsen family. "Isn't it weird that they're all named Nielsen?" Blumberg asked. He was met with an uncomfortably long silence.

The moral of the story? We know less about the Nielsens than we think. (And no, the sample isn't made of people named Nielsen. The name comes from the much-more-mundane fact that system was developed by Nielsen Media Research.) If you want to go "Inside TV Ratings," the company has a page on their website that takes you through how it all works. (Blumberg may want to check out the section tagged "The first crucial step? We scientifically select a group of households that mirrors the population at large. Learn how."

The Nielsens impact how billions of dollars in advertising money will be spent each year, and, not surprisingly, they've faced their fair share of controversy. Last year, the company came under fire when minority groups and networks like Fox and Univision charged the Local People Meter, an electronic set-top box the company wanted to use to measure audiences instead of the written diaries that had been in use since the 1950s, undercounted minority viewers. The campaign against the Local People Meter was an aggressive one, led by a group funded in part by Fox that represented more than 100 advocacy groups. (Many Fox programs, a number of which were geared towards minorities, took a ratings hit under the new system, which meant less advertising dollars for the company.) Rupert Murdoch lambasted Nielsen CEO Susan Whiting in front of network executives, Al Sharpton criticized her in her office as reporters waited outside, and a Senate subcommittee grilled Whiting on whether Nielsen, which is a monopoly, needed government oversight.

Whiting's company won the battle, however, in part because, as Business Week put it, "Nielsen wasn't counting minority viewers out: It was counting them elsewhere." The ratings points were going to cable under the new system, and outlets like Black Entertainment Television showed huge increases. (Presently, both meters and diaries are used to measure ratings. The diaries are most important during "sweeps" periods, when the entire national audience is measured. Meters are used primarily to measure viewership in large markets. More on sweeps here.)

Nonetheless, there have been charges that the system continues to undercount minority viewers, particularly Latinos. As the Los Angeles Times reports today, the company has now made a change that should please it's critics. "Nielsen Media Research will include in its national ratings shows aired by Univision Communications Inc. starting next week, a move that is expected to better measure the nation's growing Latino audience," writes Meg James. Univision executives predict "tens of millions of dollars in additional ad sales" as a result. (Previously, "Nielsen has estimated the audiences for Spanish-language shows through a separate audience panel, releasing those numbers with little fanfare." Many advertisers focus only on shows in the traditional ratings framework.)

And as USA Today pointed out this week, "Nielsen is finally entering the TiVo age." As of yesterday, the company offers three different ratings depending on when a viewer watches a program – increasingly, viewers are recording shows on Digital Video Recorders and watching them later. It's a move TV networks have been pushing for. CBS research chief David Poltrack told the paper that research shows that "people who have DVRs are watching more television and watching proportionately more network television, particularly the top shows. Their exclusion has been hurting the broadcast networks, and we're obviously anxious to get them in the sample."

Despite these changes, the Nielsens remain an imprecise measure. Like a poll, the system is based on a sample that isn't necessarily representative. And viewers who know they're viewing habits are being recorded might report that they're watching different shows than they actually are – PBS, say, instead of Fear Factor. (I talked to Poltrack about this issue in October.) In addition, it's virtually impossible to measure television audiences in shared spaces like dorms and airports.

Still, this week's news suggests that Nielsen is trying to change with the times. We'll see how far they go – and, in the meantime, ponder the scary thought that more people are actually watching Fear Factor than we thought.