Why Measurement Is A Key Issue for the Streaming Industry in 2022
Audience measurement is a vital tool that allows streaming providers to understand how their viewers are watching, to learn what content is resonating with them, and—most importantly for ad-supported services—to sell ads.
Yet despite its importance, audience measurement is not easy, and the data gained often does not accurately reflect reality. This issue has been a big focus of the industry in the latter half of 2021—especially since September, when Nielsen (whose measurement of TV viewership has been trusted for decades) lost the endorsement of the Media Rating Council, as many people believe Nielsen’s measurement tactics are no longer accurate.
At the same time, Netflix has received some criticism for how it has historically measured viewership. The streaming giant’s formula has been that if someone watched for two minutes, it counted as a view. Yet, given Netflix’s focus on longer form content, this method likely inflated numbers, as stream abandonment can often come after the two minute mark and long before a video is finished. Some have even compared this to Facebook’s much maligned tactic of counting 3 seconds as a view.
These problems, unfortunately, don’t have an easy or obvious solution, but the media industry is working to solve them in a few different ways.
Nielsen is working on updating how they measure TV and streaming viewership in an attempt to regain the approval of the MRC and the TV and advertising industry. In a statement, the company said it will “focus on innovating our core products and continue to deliver data that clients can rely on, ultimately creating a better media future for the entire industry.”
In lieu of Nielsen’s trusted leadership, companies across the industry are coming up with their own ways to measure audiences. Replacing its outdated and potentially misleading two-minute view count, Netflix has released a new measurement platform that will have “total hours viewed” as the key metric. On TVREV, Alan Wolk points out why this is good for Netflix.
“They know that their sizable international presence is going to make those 'total hours viewed' numbers seem really impressive. Especially when there’s nothing to compare it to because no one else uses that metric … Mostly though, they know why viewership metrics in general are important to them even though they don’t sell advertising. It’s all about creating the impression that lots of people are watching.”
Wolk adds that this helps attract not only new viewers, but talent for new movies and programs.
Other companies are working on alternate ways to measure. WarnerMedia, for example, recently announced that it’s on the hunt for new measurement partners, vetting new companies to work with in addition to Nielsen. Similarly, NBCUniversal has put out an RFP to measurement companies “to find metrics that accurately reflect consumer behavior and value content fairly.”
As the fight for viewership and ad dollars grows between TV and OTT, and between streaming platforms, there’s a new urgency for accurate data to reflect how and where people are watching. Solving this issue will be a huge focus for the industry in 2022.