Nielsen Shelves Its ‘People Meter’ Plan After Loud Protests

A. C. Nielsen Co., suffering another setback in its television ratings system, has shelved plans to introduce its so-called people meters in local markets around the country.

Such a plan would have meant the eventual demise of the quarterly ratings “sweeps,” when television stations hype their local news programs in an effort to boost viewing levels and advertising rates.

Nielsen had sought to introduce 800 people meters each in New York and Los Angeles beginning this fall but has been forced to abandon the plan after TV stations told the company that they would not back the proposal. Nielsen also planned to introduce an unspecified number of people meters in Chicago.

A people meter delivers overnight ratings of television programs, including data on which members of a household watched a particular program. At present, people meters are used for national ratings but have not yet been introduced into the roughly 210 markets around the country to measure local television newscasts or game shows.

Instead, local demographic ratings are collected during quarterly “sweeps” when selected viewers are asked to fill out a diary of which programs they watch. The method is considered slow, cumbersome and expensive. Advertisers buy commercial time on the basis of how many men, women or children in a particular age group watch a television program.

Nielsen has come under attack by the three television networks, which claim the national people meter ratings system underestimates TV viewing, costing them hundreds of millions of dollars in lost advertising revenue this year.

A Nielsen spokesman in New York confirmed that the company would notify stations next week that it would no longer introduce the local people meter.

The spokesman added that Nielsen would, instead, inform television stations that it would proceed with plans to introduce a “passive” meter into viewers’ homes, but such plans were still “several years away.” A passive meter would automatically register the presence of people in front of the TV set without any manual input--as is required with people meters--on the part of the viewer.

Local TV station executives in New York and Los Angeles told Nielsen that their reservations about the accuracy of the national people meter system forced them to reconsider backing the launch of local people meters.

Withdrawal of support could give Nielsen rival Arbitron a boost in its plans for a local people meter system. Beginning this fall, Arbitron will have a total of 1,000 local people meters in New York, Los Angeles, Chicago, Atlanta and Dallas.

But it is unclear whether local stations will back the Arbitron people meter, either. Most stations, facing a soft local advertising environment, are keeping a lid on costs, and this was seen as part of the reason not to support the Nielsen plan.

Still, the networks and Nielsen may not be as far apart in agreeing to a new ratings system as the networks have suggested. Last week, Nielsen submitted a plan to the networks for a “dual ratings system” to replace the beleaguered people meter.

The networks want a two-tiered system in which simple household data is collected from one source and specific demographic data from another. Now, those two sets of data are collected from a single source.

A Nielsen spokesman said the networks have not yet responded to the proposal.