• FTC Declines To Jump Into Nielsen Fray; Task Force Issues Ratings Report
  • April 20, 2005
  • Law Firm: Reed Smith LLP - Pittsburgh Office
  • Nielsen Media Research has dodged intervention by the Federal Trade Commission in its efforts to transition to electronic measurement of television viewing habits. But the ratings giant still faces pressure to prove it will employ its new system in a way that accurately reflects the viewing habits of diverse audiences.

    In a March 30 letter, FTC Chair Deborah Platt Majoras responded to Congressional requests that the agency examine Nielsen's implementation of its Local People Meter (LPM) system. The letter concludes there is no evidence that Nielsen engaged in deceptive or unfair practices, and therefore the FTC has no authority to impose quality standards for accuracy in audience measurement.

    Ms. Majoras stated that while audits have demonstrated problems with LPM implementation, Nielsen is working with the Media Ratings Council to correct these problems: "[I]t appears to the Commission that the existing self-regulatory approach is having a significant effect in attaining both extensive transparency and greater reliability in media ratings."

    Task Force Reports

    Also in March, the Independent Task Force on Television Measurement issued its report on the LPM controversy. The task force, formed last year amid protests that the replacement of hand-written diaries with LPMs resulted in under-representation of minority viewers, included New York Congressman Charles Rangel and was chaired by former Illinois Congresswoman Cardiss Collins.

    Nielsen committed to implementing the task force recommendations, which address the composition of LPM samples, employee training, measurement fault rates, diversity within Nielsen and public communications. The report can be viewed at: http://www.everyonecounts.tv/news/0323_taskforce.html.

    Nielsen noted several suggestions by the task force would require support from its clients, and the company stopped short of stating it would act on all of the recommendations.

    Some of the task force recommendations are likely to be controversial. For example, the group recommended oversampling minorities in all LPM markets so that intra-diversity within ethnic groups is more accurately reflected. In addition, the task force recommended the creation of another oversight body, the Independent Review Council, which would work with the Media Ratings Counsel and others to ensure that minorities are proportionately represented in TV ratings.

    The advocacy group, Don't Count Us Out, which has been funded by the News Corp. and has led the fight against the implementation of LPMs, announced it would create a Web site devoted to ensuring Nielsen complies with the task force recommendations.

    Other Nielsen News

    In a letter to community leaders summarizing its response to the task force report, Nielsen also noted other efforts underway to improve its services.

    The company has begun introducing the first Active/Passive (A/P) meters, designed to measure TV viewing in homes with digital video recorders. Nielsen also has begun to analyze data from its Extended Home Study of college dorms and second homes, which indicates that college students watch "significantly" more television than was previously thought.

    Why This Matters: Some in the television industry would like to see greater public oversight of Nielsen, and the company has launched numerous efforts to show industry and public stakeholders that it is responsive to concerns about its ratings practices.