C3 ratings tank, but Nielsen folds in Hulu and YouTube viewers

Nielsen announced this week it will begin including viewership metrics for select programming that’s available on Internet TV services like Hulu Live and YouTube TV into its Digital TV ratings (DTVR) platform so that TV networks can count Internet-based live viewing metrics. Nielsen has been working on a solution for over two years.

Nielsen’s new solution will count programming towards the network’s C3 or C7 ratings, and so will span live streaming, DVR and time-shifted viewing, across PCs, tablets and smartphones. But Nielsen will only count programming whose digital ad load mirrors that of broadcast TV. And anything viewed after the seven day window won’t be included. And in order to take advantage of the new solution, content owners will need to add special tags to the content that’s streamed on Hulu and YouTube TV.

The ratings solution will use a census-based approach for measurement on connected devices, along with Nielsen’s old panel-based approach.
“Live TV represents the majority of time spent watching on the service. Our network and advertising partners will benefit from Nielsen DTVR measurement of YouTube TV,” said Heather Moosnick, Director of Content Partnerships for YouTube TV. It doesn’t sound like it if she continues to pre-judge it.

Even ESPN, which has been rather vocal about Nielsen’s shortcomings in getting cross platform measurement in place – and a network that has suffered significant viewership drops over the past two years – has piled on a nod of approval for the new measurements, with ESPN marketing and consumer engagement SVP Wanda Young saying the inclusion on live and on-demand streaming platforms “represents an important step forward toward complete cross-platform measurement.”

But Nielsen still has a long way to go for unifying viewing metrics across platforms, devices, and consumption modes. The company is feeling added pressure for getting its unified metrics in place as data firms like Kantar and comScore are hoping to chip away at Nielsen’s currency status by offering census-based data measurement, which is superior in measuring viewership than Nielsen’s older, panel-based approach.

Viewership that occurs beyond seven days after the initial broadcast in VoD is counted towards Nielsen’s Total Audience metric. Nielsen has said in the past that VoD viewing can give programs up to a 30% lift in ratings. This week, Nielsen announced it’ll include VoD content ratings for a handful of networks, including Turner and Discovery, into the media planning tools it offers marketers.

The announcement coincides with an investor note from MoffettNathanson tracking the staggering ratings drops in the C3 window during Q2 to TV networks. Broadcast and pay TV networks saw C3 ratings for viewers aged 18-49 drop 12% during the quarter. That follows an 8% drop in Q1.
Ratings dropped across the board for US broadcast networks. Disney-owned ABC saw a 19% drop in ratings and Fox dipped 20%; CBS dropped 10% and NBC’s ratings dipped 9%.

Of the top pay TV networks, ESPN’s owner Disney dropped 15%, Time Warner 14%, Scripps Networks Interactive 10%, as did Fox’s pay TV networks. AMC saw a 9% dip in ratings, Viacom suffered an 8% drop, Discovery was down 7% and NBCUniversal dropped 6%; while A&E Networks also saw ratings slip 5%.

“Things are playing out worse than we imagined, as the second quarter 2017 will mark a record low in prime time,” analyst Michael Nathanson said in the report. “The decline of 12% surpasses the prior weakest 1Q 2015, which was up against a Winter Olympics compare.”

Those ratings drops comes after the TV industry wrapped up a better-than-expected upfronts season. Total ad revenues hit $19.7 billion, according to data from Media Dynamics, up 6% over last year’s upfronts. While most observers had expected an unimpressive upfront this year, with concerns over brand safety, ad fraud and verification in online video advertising helping to give the traditional linear TV ad business a slight bump. And brands were more interested in TV network’s digital advertising opportunities, too.

The newly expanded DTVR metrics aren’t going to give any TV network much of a bump. For one thing, both Hulu and YouTube TV are brand new services, with limited market penetration. And Nielsen’s ad rules will pare down the episodes that can be counted. It’s a small bone to throw a group of ratings-starved networks.