Can lowly-rated Nielsen bounce back with a buyout?

Once trusted as the gold standard of comprehensive cable and broadcast ratings, Nielsen’s reputation has taken a hit in recent years and was eventually stripped of its Media Rating Council (MRC) accreditation, leaving TV buyers short of a measurement solution fit for today.

However, earlier this week a consortium of investors led by firms Elliott Management and Brookfield Asset Management were rumored to be buying the measurement stalwart, sending its stocks up 30%.

“No one cares if they are public or privately owned – the trust issues have more to do with Nielsen totally breaking during Covid and forcing an out-of-date system on a marketplace that is both able and anxious to evolve,” claims Jason Damata, chief executive officer of Fabric.

At Fabric, Damata oversees a consortium of media strategists representing clients including Paramount, Netflix and Hulu. He says: “Nielsen’s multi-decade monopoly in TV ratings won’t collapse overnight – there are too many systems built on its currency.”

Having a “monopoly" over the TV measurement system means it is slow to adapt to changing market conditions “because it is printing money through the status quo,” says Damata.

As The Drum was writing this article this week, it emerged that Byron Allen, who owns the Weather Group, Entertainment Studios Networks (ESN) and CF Entertainment, is seeking billions of dollars of compensation for “inaccurate” counting and fraud by concealment. Allen’s suit claims Nielsen has been miscounting for years but concealed it. When it rains, it pours for the measurement firm.

In context, the industry has been calling for Nielsen to overhaul its system for years, which it eventually responded to in October by unifying its solutions. This update was recently followed by the introduction of a cross-channel planning tool to a connected TV (CTV), which was previously only available for linear TV.

The rumored acquisition does signal that investors have faith Nielsen can repair the damage and build an up-to-date system. For the industry to trust Nielsen again, president and chief executive at the VAB Sean Cunningham says it needs to deliver “deep disclosures and real transparency, commitment to the modernization that sharply increased competition demands and increased collaboration versus increased collision with their major clients.”

Those solutions could come from Nielsen as it is or after a sale. Either way, Cunningham says the industry is “rooting hard for these near-term outcomes from any version of Nielsen.”

Major changes to Nielsen could spell the end for the panel-based measurement system. Rob Cukierman, general manager for measurement and product partnerships at LoopMe, claims: “We have now moved beyond panels.

“It is essential for all data owners to work together to standardize their data so that it can be used interoperably in an open architecture to offer deduplicated reach so advertisers and their agencies can understand the impact of cross-media campaigns.”

The UK’s rating system Barb has undergone updates of its own by adding subscription video on demand (SVOD) data to its reporting in November, albeit still panel-based. Can additive elements to the panel cut it in the modern day? Barb’s going to find out.

The shift in viewing behavior allows for opportunities for new measurement players to enter the space, Cukierman says. “To that end, it’s not surprising to see Nielsen looking for a buyer to keep up with market innovation and technology,” he adds.

Nielsen saga timeline

• May 2020: MRC conducted an audit that found Nielsen had been undercounting total television usage by adults aged 18-49 by up to 6%

• September 2021: MRC stripped Nielsen of its ratings accreditation

• October 2021: Nielsen unified its various TV solutions and rebranded as Nielsen One

• November 2021: Nielsen unveiled a new framework for commercial TV ratings shifting away from its C3 currency and offering better ad insights

• February 2022: Nielsen introduced its cross-channel planning tool to CTV, which was previously only available for linear TV

• March 14 2022: reports emerge of a potential $15m buyout of Nielsen

• March 16 2022: Weather Channel chief executive officer Bryon Allen files a lawsuit against Nielsen claiming inaccuracies and fraud