Nielsen has asked to take a break from the media industry’s seal of approval, citing “unacceptable” treatment by some publications. The company is asking that it be taken off the masthead of many publications and websites, which will undoubtedly cause a stir in an industry where brands are already struggling with declining readership.
For the first time since the 1960s, Nielsen Holdings PLC has requested the Media Rating Council to suspend accreditation for its national TV rating service, a move that would leave the measuring giant’s main product without the organization’s stamp of approval.
The firm attributed the request to worries about its panel, which assesses ratings in the United States, as well as attempts to update its national TV measurement product.
“At this moment, we think that going on sabbatical is the right course of action,” Nielsen said in a statement. “It will enable us to concentrate on developing our core products, continuing to provide data that the industry can trust, and ultimately building a better media future for the whole industry.”
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The MRC examines and accredits media measuring procedures in order to build trust in the sometimes complicated or ambiguous technologies that are used to track outcomes.
After concerns were made regarding difficulties maintaining its panel technology during the pandemic and other issues that led to an undercounting of viewers, Nielsen’s accreditation was suspended. This may further undermine the trust of Nielsen’s TV network clients and advertisers. However, short-term impacts are unlikely to affect the company’s bottom line, according to Douglas M. Arthur, an analyst with Huber Research Partners LLC.
According to him, Nielsen’s client contracts do not need accreditation, and there is currently little competition for prime-time TV ratings data.
Mr. Arthur said, “I’ve been hearing about competition dangers for the last 20 years.” “So far, nothing.”
Losing such a seal of approval, on the other hand, may give consumers greater clout when a new contract comes up, he added.
The Video Advertising Bureau, which represents several major television networks, asked the MRC in July to revoke Nielsen’s certification, citing the panel’s difficulties during the epidemic as a reason.
The MRC was scheduled to vote on the issue during a meeting on Thursday.
The organization’s television committee voted on Nielsen’s proposal during the meeting, which was nevertheless held. The committee has submitted the issue and its recommendations to the entire MRC board for consideration, according to a statement from the MRC. According to the MRC, a pause period may continue up to six months, and a service can seek a second six-month break.
The VAB has not been pleased with Nielsen’s request to halt accreditation, according to the trade group.
“Just hours before the MRC suspension vote process is activated, Nielsen has essentially announced ‘you can’t fire me, I quit’ after months of very public insistence that there is nothing wrong with their ratings data, but now facing a slam-dunk VAB case for accreditation suspension,” said VAB President and Chief Executive Officer Sean Cunningham in a statement.
Companies have long chastised Nielsen’s ratings system, which underpins virtually all transactions in the $70 billion U.S. conventional TV advertising market. However, when the MRC announced this spring that Nielsen had undercounted TV viewers by much to 6% in February 2021, the accusations erupted again.
According to the MRC study, the audiences who were not originally included should have cost advertisers an extra $39 million to $234 million in February, depending on whether it was a 1% or 6% miss.
According to press sources at the time, Nielsen acknowledged that there were issues with their panel.
The undercount has sparked fresh demands for reform from the media’s top echelons.
During a second-quarter earnings call on Aug. 3, Discovery Inc. CEO David Zaslav stated, “We’re competing with the likes of Google and Facebook, where they have the finest data, the cleanest data, and you compare that to this outdated infrastructure.” He said, “I don’t have a lot of optimism for Nielsen.” “I believe we’re going to have to work our way out of it as an industry, from a technological standpoint, and leave them in the dust because they can’t get it together.”
Nielsen has introduced products to track streaming views and said that by the autumn of 2024, it would have a nationwide product that tracks TV across all platforms, including conventional and internet-connected TV.
Alexandra Bruell can be reached at alexandra.bruell@wsj.com.
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