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'Gauging' Viewer Data for OTT

Nielson
(Image credit: Nielson)

It was at the 1995 NAB Show that I interviewed Rob Glaser about a new technology that his company, RealNetworks, was introducing to broadcasters at the show. It was called RealAudio, the first “streaming” of audio media over the internet.

The idea of delivering audio programming over the internet was so new to me at the time that it took a lot to wrap my head around this totally new concept. Interestingly, that interview I did back then with Glaser for this publication was his first, and in later years, he called on me first at press conferences because he felt I brought him good luck due that interview in the beginning days of his company.

Within two years, Glaser announced RealVideo, the video version of streaming media. Though it hiccupped and sputtered at first, video over the internet clearly had a future.

NIELSEN PLAYING CATCHUP

Fast forward to the present—26 years later. Streaming media, with all the kinks worked out, has gotten so popular and works so well that it threatens both broadcast and cable television. How do we know that? Nielsen, the TV measurement company, finally—after years of trying—is now able to measure streaming viewership. 

Nielsen recently announced that it now has a new metric that it says allows it to make percentage comparisons of how many people are streaming programs on their home TVs vs. how many are watching traditional cable and broadcast channels. Viewers are still spending more cumulative time watching TV the old-fashioned way—but streaming is gaining fast... very fast. 

This spring, Nielsen reported that 25% of the time American viewers used their television sets to watch broadcast programming, while 39% watched cable TV. However, 26% watched streaming services. This number comes with an important caveat: it does not include tablets or smartphones, which are very popular with the younger demographic. Another nine percent of the time, viewers used their TV screens for things like video games or watching programs or films they had saved on DVR.

“The past year has categorically shifted the television viewing landscape. Even as people begin to dive back into their pre-pandemic activities, based on the changes many made to enable streaming coupled with the variety of newly introduced services, we expect people to keep sampling and exploring their options," said Brian Fuhrer, senior vice president of product strategy at Nielsen. "Maybe just as importantly, as production ramps back up, new content will enter the space, driving additional traction.”

The streaming share is increasing rapidly. It was at about 20% in 2020, Nielsen said. In 2019, it was about 14%. It could go up to about 33% by the end of this year, Nielsen predicts.

Netflix and YouTube are the streaming leaders, the research firm said, with each capturing six percent of total TV time. They are trailed by Hulu (three percent), Amazon (two percent) and Disney+ (one percent).

Nielsen calls its new measuring metric “The Gauge.” It comes in addition to its previous method, which relied on audio-recognition software included in Nielsen devices that are now in 38,000 households across the country. Again, both metrics measure only what is viewed on home television screens and does not count what is watched on phones, tablets or laptops. This means the percentage statistics are low.

For The Gauge’s streaming stats, Nielsen measured about 14,000 households through hardware that watches internet traffic as it passes through a router. Until now, Netflix was not impressed with Nielsen’s measurements. With The Gauge, however, that opinion has changed. “They’re thoughtful people; they’ve been doing this for a long time—I assume it’s pretty good,” Reed Hastings, Netflix’s co-CEO told The New York Times. “They have incentive to be accurate.”

Netflix’s approval comes as a boon for Nielsen. For months, the research firm has been under attack by executives at traditional media companies who have accused it of undercounting television ratings during the pandemic, when most viewers were stuck-at-home.

'ANTIQUATED METHODS'

This spring, David Zaslav, president and chief executive officer at Discovery, who is in line to lead a media giant if its merger with WarnerMedia is cleared by regulators, called Nielsen’s reporting methods “antiquated.” Nielsen acknowledged some undercounting because of difficulties related to the maintenance of devices in some Nielsen homes during the pandemic.

TV networks and distributors represented by the Video Advertising Bureau (VAB) are calling on the Media Rating Council to suspend accreditation of Nielsen’s national rating service, since the undercounting of homes during the pandemic.

David Kenny, Nielsen CEO, said The Gauge is an attempt to give a clearer picture of how American viewing habits have changed, one that better accounts for how people flip back and forth between broadcast, cable and streaming services.

“To the consumer, she’s got her remote control, and she’s moving from live sports over to news down to streaming, and back around,” Kenny told the Times. “We need to bring the whole industry together to a comparable way of looking at this.”

Over the years—as Netflix and others took hold—Rob Glaser and his RealNetworks lost exclusive control of the streaming media revolution. His original business model was based on selling the server software. Early competitors, including Apple and Microsoft, started giving that software away, causing Real’s server sales to falter. 

However, don’t feel bad for Glaser, whose company is still thriving today. RealNetworks, based in Seattle, is now a provider of artificial intelligence and computer vision-based products. The company also provides subscription-based online entertainment services and mobile entertainment and messaging services.

It is safe to say now that Rob Glaser has established a pioneering position in streaming media and his name will go into the history books of television broadcasting. It has been a remarkable run that took only about a quarter of a century for his technology to change the way we watch television. 

Frank Beacham is an independent writer based in New York.