FTC won't interfere with Nielsen

WASHINGTON — The Federal Trade Commission has declined to play any regulatory role over Nielsen Media Research’s new digital audience measuring system, spurning an intensive lobbying effort by News Corp. that prompted 22 members of Congress to ask the agency to do so.

In a letter to Rep. Albert Wynn (D-Md.), one of the 22, FTC topper Deborah Platt Majoras said claims Nielsen’s Local People Meters are inaccurate and unfair are groundless. Moreover, an agency inquiry showed that Nielsen has been responding to concerns raised by recent audits of LPMs, she said.

“Nielsen has not challenged the results of the audits,” Majoras wrote. “To the contrary, it has been working … to correct the problems.”

The FTC found no evidence Nielsen had engaged in any unfair or deceptive trade practices, “such as misrepresenting its ratings system or failing to disclose material facts about the system. … It appears to the Commission that the self-regulatory approach is having a significant effect in attaining both extensive transparency and greater reliability in media ratings.”

Nielsen began testing LPMs in Boston in 2002, followed by tests in New York, Los Angeles, Chicago and San Francisco two years later. Among shows that received low ratings were a handful on Fox-run UPN stations that targeted African-American and Hispanic viewers. Fox parent company News Corp. charged the LPM ratings were inaccurate and accused Nielsen of undercounting minority viewers. At stake was ad revenue for those shows. If the numbers were accurate, Fox could not charge rates needed to keep the shows on the air, the company claimed.

Shortly thereafter, Don’t Count Us Out, an org funded by News Corp., made the same charges, joined by various community leaders and elected officials. In response, Nielsen created an independent task force in 2004 to examine the system. Last month, the task force issued a 62-page report that recommended changes to better measure minority auds. Recommendations focused on sampling techniques, field operations, fault rates, diversity and communications.

Majoras acknowledged LPMs are not yet perfect, but concluded federal regulation was not necessary.

“The commission determined clearly that the marketplace is working and there is no need for government regulation of TV ratings,” Nielsen said in a statement. “We believe the very small number of media companies who favor government regulation would do a real service to the TV industry if they’d drop their self-serving fight against Nielsen and work cooperatively with us.”

At least one company won’t be doing that. “A fair and accurate ratings system is a vital public interest that is not being served by the Nielsen monopoly,” said Cynthia Jasso-Rotunno, exec director of Don’t Count Us Out, in a statement. “We are disappointed but not surprised by the FTC’s response. We remain confident that working with our allies in Congress, as well as community leaders and representatives of the media industry, we can achieve meaningful oversight of this industry.”

Similarly, Sen. Conrad Burns (R-Mont.) wrote back Wednesday to Majoras, saying he was “somewhat disappointed” in the FTC’s inquiry because it was “too narrow.”

He said he plans on holding hearings on the subject later this year, adding, “I will not hesitate to introduce new legislation should the evidence indicate that it would be in the public interest to do so.”

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