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Ratings War in India Reaches Settlement

Advertiser strike is averted after compromise, but measurement systems need replacement

A rift over ratings that had split the Indian TV industry was seemingly settled today. But for how long?

India’s TV channels were never going to go dark, but they might have been forced to air without commercials, as a dispute raged between advertisers and broadcasters over ratings for the past three weeks.

Some 20 leading consumer goods manufacturers threatened to pull ads, while the top broadcasters said they would opt out of audience measurement.

The standoff had been sparked at the beginning of July by TAM Media Research, a centralized audience measurement service run by AC Nielsen and Kantar Media Research, that it would cease supplying weekly ratings and instead shift to monthly data.

Advertisers howled, arguing that this was a regressive step, and that in other countries daily audience data is available.

The settlement announced Thursday means TV audience data will chiefly be supplied in absolute numbers, known as Television Viewership in Thousands (TVT). This will be the only data in the public domain. However advertisers and ad agencies will still be able to request old style weekly television ratings (TVR).

TAM will also offer four-week rolling TVT averages, which are thought to be more stable and reliable for measurement of niche channels, news channels, regional language networks and English-language services.

Although the settlement today puts more data on the table, it only represents a stopgap measure. TAM is likely to be replaced by a measurement system organized by a joint industry group called the Broadcast Audience Research Council (BARC). But BARC is not expected to be operational for at least 12-18 months.

Thursday’s settlement between advertisers and broadcasters and the proposed establishment of BARC both reflect the fact that almost nobody in Indian media finds TAM satisfactory.

The problem is that India is too large and disparate for easy measurement. At the most advanced end of the spectrum, India is powering ahead with competing direct-to-home (DTH) satellite services that accelerate the development of pay TV services (and lessen the need for advertising). In major cities the compulsory installation of digital set-top-boxes has begun in a move intended to eliminate cable piracy and increase the number of households who pay the legal providers.

At the other end, much of rural India has extremely low levels of television penetration. In a country of 1.2 billion people, the estimated number of TV households is a modest 153 million, according to accountancy firm KPMG.

TAM is one of two TV data providers in India, but is usually referred to as a monopoly because of its dominant position and has been criticized from all sides. It operates one of the world’s largest survey groups, some 33,000, as well as over 8,000 Peoplemeters.

The major channels groups complained that TAM’s weekly data was unreliable and often subject to unexplained fluctuations. This month, their impatience reached a critical point and eight groups asked TAM to refund their subscriptions and for the organization to cease measuring them. (Discovery initially joined the move to monthly data, but it quickly did a U-turn, leaving the leading seven broadcast groups that account for 80% of TV ad revenues, pressuring TAM.)

The networks argued that ratings trends rarely change in less than a week and, besides, that much advertising is bought on annual contracts. Advertisers responded by saying that they need quicker data on which to base their spot-buying decisions.

Specific complaints included those from state broadcaster Doordarshan and Bloomberg. Doordarshan/Prasar Bharati last year began legal action against TAM, claiming that TAM under-represented its channels’ rural audiences. Bloomberg said its business channel is primarily watched in offices, an area that TAM barely touches.

“We are delighted to have reached this agreement. We believe it is important for the industry, and from the perspective of our social responsibility, we must reflect both the growing television audience and the data in a more stable and useful manner,” said Manjit Singh, president of the Indian Broadcasting Foundation, in a statement.

BARC is widely seen as the next solution for the TV industry’s current measurement woes. But the fast rise of online and mobile media is already drawing substantial advertising dollars away from the traditional staples of print, outdoor and television and may mean that the next generation audience measurement system will need to be more flexible, and likely just as contested.

(Naman Ramachandran in London contributed to this report.)

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