TV/Video Landscape

1985 was an important year in TV measurement history. In that year, Arbitron/Nielsen invented People Meter (Watch this video: https://www.youtube.com/watch?v=7kdzkEP3a78) to measure TV viewership in a completely new way. I certainly agree that People Meter is a much better method than a paper diary to collect viewership information. As a result of this innovation, People-Meter-based TV ratings became the gold standard (i.e., currency) in the TV industry. Today, roughly 90 countries have adopted this system.

When we look back on the audience’s behavior in 1985, we see that 100% of TV viewership was live TV. We have to wait another 15 years for Tivo to debut its first DVR. Since then, the audience’s watching behavior has changed significantly. The pace of change has accelerated in the last five years. 

In the US, TV-Connected Devices account for 16% of the Average Time Spent per day on video. Traditional Live+Time-Shifted TV account for only 77% of this and, in fact, dropped 14% in only the last three years. Separately, about 7% of Time Spent happens on other, smaller screens such as PCs, smartphones, and tablets. (These devices account for roughly 50% of impressions.) Fragmentation is real. No one can stop it. 

The big issue is that the entire industry still relies on TV ratings to transact TV/video inventory as the currency. Based on BARB (UK’s Joint Industry Committee), the unidentified use of the TV set during prime time in the UK has increased from 3 to 87 in the last three years. The global TV/video ad market is about $200 billion. It’s hard to believe that today’s currency cannot accurately measure roughly $50-60 billion worth of ad inventory. 

The MRC (Media Rating Council), as the most important industry body, recognized this challenge three years ago and has been working hard to address it. Last September, the MRC published the Cross-Media Measurement Industry Standards for Video. It requires 

• Person-level granularity 

• Second-by-second reporting

Additionally, instead of using GRP or Impression, it proposes the use of Duration. 

In my opinion, this is the biggest paradigm shift in the media measurement space in the last 35 years. It completely changes the currency for all video ad inventory. Also, it creates unified metrics across digital video and TV. Of course, so far, MRC has not accredited any measurement company for this standard. However, I know that multiple companies, including TVision, are working hard to solve this challenge. 

As the next step, MRC is working on the standard for non-video inventory and business outcome-based attribution solutions. While measurement companies are working hard on these challenges, the gap between what people watch and what we can measure is widening. I will get into some consequences in the following posts.

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