Wednesday, November 19, 2014

Nielsen Attempting To Measure Netflix

It is hard to get an accurate count when companies don't want to be counted.  In today's Wall Street Journal article, Nielsen hopes to measure usage of both Netflix and Amazon Prime through its audio feed.  And while it may garner some information, it comes across as half-baked.  First, it only measure on connected TV sets, "Nielsen is still working on a way to measure subscription-video viewing on mobile devices, where such technology won’t work."  And second that it is being done without Netflix or Amazon's support.

Of course, getting good data is key to essentially what content owners want to know, "Is putting content on Netflix impacting the viewership on linear and traditional VOD".  But as more and more Netflix consumption is on mobile devices, the value of the research may be strained.  Common sense may already tell content owners what they implicitly already know.  Viewership is shifting from cable and broadcast to digital streaming media.  Current research already confirms this trend. 

Why doesn't Netflix or Amazon care to be measured by Nielsen.  Their revenue comes from subscription to their services and not from advertising.  Internally, they know who has subscribed and what they are watching.  And so, doing a deal with Nielsen today doesn't seem to be a high priority for either service.  For Nielsen and its customers, the data gleaned from this workaround collection process, via audio, may tell a story, just not a complete one.  Content owners that are doing programming deals with OTT providers see it as another window of revenue opportunity. 

And while it may create an issue of cannibalization that could hurt ad revenue in other windows, it can also help to draw new audiences.  Case in point, Breaking Bad on Netflix of older seasons led new audiences to catch up on the series to then head over to AMC to watch the current season play out.  A win for both platforms.  And one day when Orange Is The New Black sells a cable distribution window, the buzz it has gotten from Netflix should draw large audiences and consequently ad dollars.  And Nielsen needs to find a way to accurately measure all streaming usage.