Nielsen to begin counting broadband viewing homes

NEW YORK (AP) -- The company that measures television viewership said Thursday it will soon begin counting people who watch programming through broadband in addition to the traditional broadcast or cable hook-up.

Nielsen's move is a significant step toward recognizing a world where the definition of TV viewing is swiftly changing and toward satisfying clients concerned that the company isn't keeping up with those changes. Separately, Nielsen is developing ways to track content on tablets and mobile phones.

For many years, roughly 99 percent of homes in the U.S. had televisions that received service through broadcast, cable or satellite signals.

Now the number of homes without such service is 4.2 percent — and growing each year. About three-quarters of those homes still have TVs, however, and their owners watch programming through game consoles or services like Netflix and Amazon. Starting September, Nielsen will have meters that can monitor viewership in those homes, said Brian Fuhrer, a senior vice president at Nielsen.

This will add roughly 160 homes to Nielsen's current sample of 23,000 houses nationwide with meters monitoring viewing habits.

More significantly, Nielsen will return to its sample to find homes that have cable or broadcast, but also separate TV sets hooked up through broadband. This will add an estimated 2,000 more broadband sets, significantly increasing the sample size, Fuhrer said.

"Consumers are accessing content in new ways that fall outside of our traditional definitions and if we don't expand ... we could be missing an emerging trend," he said.

Under Nielsen's old definition, there are an estimated 5 million homes in the U.S. without working TV sets, up a total of 3 million from 2007. Nielsen and the industry studied this to see whether people were pulling their plugs because of the recession; instead, the bulk of the new "non-TV homes" were simply watching TV in a different way.

The changes aren't likely to quickly boost the ratings of your favorite program, however. Most of the programs shown through broadband don't have the same encodings as shows watched traditionally, primarily because they often have different advertisements. As a result, Nielsen will be limited in tracking what particular shows are being watched, at least until more universal encoding standards are developed.

Some broadband services have the ability to measure how much individual programs are seen but keep that information private. It is why, for example, there have been no estimates of how many people have seen Netflix's well-reviewed new series "House of Cards."

Even without those specifics, Nielsen will still be able to collect information such as who in the household is watching through broadband, and how much they watch. That is data that will at least be valuable to advertisers and marketers trying to target specific consumer groups. Nielsen's change was first reported in The Hollywood Reporter.

When the industry will be able to see how much people are watching through broadband, it will increase the pressure for universal encoding — networks and advertising agencies will want to know what those new viewers are watching, said David Poltrack, chief research executive at CBS.

If, as expected, broadband viewing continues to increase, Nielsen's change at least ensures that this won't be ignored, Poltrack said.

"All of these things are designed to keep them ahead of the game," he said.

Brad Adgate, top researcher for Horizon Media, noted that several networks have seen the median age of their viewers increase significantly over the past few years. In the way television does business, older viewers are less valuable to advertisers. Presumably, younger viewers are more likely to be watching through broadband — and many had dropped off Nielsen's radar, he said.

Nielsen must also develop a separate metering system for tablets and mobile devices, and Fuhrer said that work is ongoing.