Americans Watching TV Less Due To DVRs - Niesen and MediaPost

For Nielsen to write this, and MediaPost too, and not point to The Internet and video is myopic at best.

Nielsen Finds Drop In TV Usage Is Real, Not Methodological, Impact Greatest Among Heavy Viewers

by Joe Mandese, Monday, Aug 27, 2007 9:00 AM ET

IN AN EFFORT TO ADDRESS client concerns over declines in TV usage this year, Nielsen has issued a report concluding the drop most likely is due to real changes in TV viewing behavior and is not due to TV ratings methods, or new technologies like DVD players, video game systems or digital video recorders (DVRs). But while concluding that "no single factor played a predominant role" in the declines, the Nielsen report found that the biggest impact was felt among TV's heaviest viewing households.

The report does not offer any explicit explanations as to why TV usage has declined, and Nielsen said it did not analyze the impact of changes in programming or in weather patterns that may have been a contributing factor. However, the report includes an ominous finding suggesting that the biggest impact may be among TV's biggest users.
After drilling into data for the 12 TV markets hat have had the biggest losses in TV tuning over the past year, Nielsen found that, "that the biggest losses in tuning appear to be coming from the homes that tuned the most last year."

While the presence of DVRs in and of themselves was not deemed a contributing factor, Nielsen said that the addition of a DVR into a TV household appears to reduce overall usage levels in those households.

"The biggest losses in tuning appear to be coming from the homes that tuned the most last year," Nielsen reported. "Some homes are tuning relatively more this year, these are generally the lowest tuning homes in the panel; the heavy tuners who acquire DVRs tend to tune less, more than offsetting these increases, resulting in overall [households using television] declines."

The report added that the changes in tuning cannot be attributed solely to the acquisition of DVRs, and that Nielsen plans to conduct additional research into how the addition of DVRs impacts TV usage in those households.

Nielsen said the penetration of DVRs in its sample has grew from about 7% a year ago, to 17% this year as a result of actual increases in DVR penetration, as well as in Nielsen's ability to recruit more DVR households. Nielsen's sample is still considered to be slightly lower in DVR penetration than the actual U.S. population.

"While the inclusion of DVR homes in the sample this year has been ruled out as the driving force behind the viewing level changes, it is clear that it has introduced a different viewing dynamic in these homes," the report concludes, adding, "A full discussion of how viewing changes when a home acquires a DVR will be presented in a separate communication that will look at homes in our Local and National People Meter samples."

Joe Mandese is Editor of MediaPost.

Mark Cuban Says Advertisers Have Leverage In Pricing Ads For Video - Really?

In his latest blog post, Mark Cuban takes a look at the impact that Nielsen's release of commercial data has had on the discussion of how ads in videos should be priced.

He says "So riddle me this. If the Internet is the ultimate DVR for video, will advertisers put comparable pricing parameters on internet video that they are trying to put on TV DVR commercial viewing ? If they do, and only pay for videos viewed within 3 days of the video being posted, won't that put a huge crimp in the internet video business ?"

My basic reponse is that there's an apples and oranges comparison here. Videos are ran over and over again each day. Plus, because they're within an optimized webpage, they're looked up in a search engine. Thus, if the video concerns a Paris Hilton issue that is discussed on the TV news, the search for that will go up, and thus cause a new round of views for the applicable video.

For the video meter to stop running in this case would be unfair and not negotiable from the standpoint of the video producer. A commercial withing a video, or a sponsored video is part of the video. Thus, it "moves" with the video -- if the video is found on Mamma.com, the ad will be there, and so on.

This is an entirely new approach to commercial message distribution. I don't think one can compare it to current TV commercial economics. I also don't think advertisers really have a good clue what's going on in new media. Many of them can't even define Web 2.0