Nielsen hit by antitrust lawsuit in US

MUMBAI: US television ratings provider erinMedia and television network ReacTV have filed a antitrust lawsuit in a US District Court against Nielsen Media Research.

The plaintiffs contend that Nielsens monopoly over television ratings has resulted in a distorted view of what millions of Americans are watching and deprives them of a voice in determining what programming stays on America's airwaves.

The suit seeks to end Nielsens monopoly over television ratings research by, among other things, voiding Nielsens staggered long-term contracts with TV networks and other customers and allowing these customers to take advantage of new interactive set-top box technologies that supersede Nielsens outmoded sampling methods and allow for the counting of every viewer.

erinMedia chairman and CEO and ReacTV founder and CEO Frank Maggio argues that TV networks, advertisers and the American public are all poorly served by Nielsens antiquated methods.

"The American television industry represents not only $60 billion in advertising dollars, but is a $250 billion business that serves 109 million households. Yet today, when service operators can easily capture viewer preferences in a privacy-protected manner, Nielsen still relies on only 7800 of those households to produce national ratings. We believe that the ratings market needs to be opened up to new methods that allow the use of data from every television, every second of every day.

Maggio cited the negative effects of Nielsens monopoly, including wasted advertising dollars, the cancellation of undercounted TV shows, the under-representation of minority viewers, and the homogenisation of American television programming.

It is commonly known that an estimated 10 to 30 per cent of TV advertising is wasted, because Nielsens inaccurate ratings do not allow effective targeting of viewers who might actually buy the advertisers products. Thats $6 billion to $18 billion in wasted ad expenditures that add to the cost of consumer products.

"And until we take advantage of universal data capture from digital set-top boxes, minorities and other viewers will continue to be miscounted, and many of viewers favorite programs will continue to be cancelled. Thats not just monopolistic its anti-democratic.

Set-top data can be gathered today from the 25 million US households that have advanced set top boxes, Maggio noted. As analogue cable and satellite subscribers migrate to these two way boxes, the potential exists to count the votes of more than 85 million households. Nielsens methods largely rely on the self-reported viewing habits of a small sample of recruited and coached viewers. The resulting ratings are presented as fact and do not include error estimates or confidence intervals.

"The other recent alternative is Arbitrons Orwellian Personal People Meters, which are clipped on peoples clothing and measure a persons behavior every hour of every day. Neither is acceptable in our society. Its time to use the digital technology we have today to capture channel changes on a second-by-second, privacy-protected basis.

erinMedias methods, in contrast to Nielsens, use the data captured from digital set-top boxes, of the kind increasingly used by cable and satellite TV networks, to measure second-by-second the choices of every viewer. Individuals personal information is barred from access by erinMedia and the viewing data is captured by the service provider. Demographics are appended to the summarized data using sophisticated mathematical analysis obtained from a second source.

Nielsen has control over every aspect of the ratings process, from data sampling to data collection to data analysis. That allows too much influence and control by a single entity, and the potential for data manipulation by the highest bidder. What America needs instead is a system in which TV networks control access to their customers, a second company captures the data through set-top boxes, and a third company analyzes it Maggio says.

The suit specifically requests, among other things, that the Court award injunctive relief to end Nielsens unlawful monopolisation; that all of Nielsens long-term, staggered contracts immediately become invalidated; and that Nielsen be denied the ability to continue anticompetitive practices such as purchasing its competitors.

Maggio says, The American way is about innovations that let people express their individual preferences. .We dont want to replace Nielsen. There is plenty of room for two players or more. What we do want is a level playing field that allows us and any other players to take advantage of digital technology to reflect the preferences of 25 million people or more as inclusively as possible.

erinMedia is a media research company that focusses on understanding television audience behaviour in all its forms  cable, broadcast, satellite, linear, non-linear, and interactive. erinMedia's methodology combines privacy-compliant tuning data collected from advanced set-top boxes with independently gathered demographic data to produce insights into audience composition and viewing behavior.

With over 135 patent-pending claims, erinMedia states that its proprietary technology produces accurate and timely analysis without the use of personally identifiable information. erinMedia brings experience and expertise in mathematical analysis, statistical modeling, and software development to the science of television audience research.

ReacTV claims to be Americas first creative media production company to develop reactive television programming. ReacTVs patented technology enables interactive gaming networks, where viewers at home compete for prizes, simply by watching and reacting to their TVs. ReacTV has exclusively licensed the patented CRAV Reactive Ad System. This allows broadcasters, publishers and sponsors to create a new level of consumer awareness through reactive advertising.

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