November 19, 2017

How Many People Watch Netflix? Nielsen Tries to Solve a Mystery

Nielsen announced the initiative on Wednesday morning, but it has been collecting Netflix viewership data over the last two months in a kind of test run.

The company said it was able to determine how many viewers were streaming Netflix content through audio recognition software in the 44,000 Nielsen-rated homes across the United States.

Nielsen has been releasing its Netflix data privately to media companies that have subscribed to the service, including the Walt Disney Company, Warner Bros., Lionsgate, NBCUniversal and AE Networks.

Nielsen executives said that those companies would now have the ability to access viewership figures for shows they licensed to Netflix, like “Friends” from Warner Bros., as well as originals like “Orange is the New Black” and “Stranger Things.”

Nielsen executives said the company had not yet begun collecting data from other streaming services like Hulu or Amazon.

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The move is a necessary step for Nielsen — and one that many in the industry have said is long overdue. Some entertainment executives have criticized the company as being a relic of the channel-surfing era while more viewers take to streaming content.

Netflix has long played by its own rules, and it is not likely to hand over its streaming data to an outside party. The new ratings figures, which Nielsen did not release to the news media, are likely to result in some pushback from the digital giant, which announced that it will spend $7 billion to $8 billion on content in 2018.

And there are likely to be questions concerning Nielsen’s accuracy. Though the ratings are drawn from its much-ballyhooed television panel, the numbers include only viewers who are using a television set. If someone watches a Netflix show on a laptop, tablet or smartphone, it is not included in the count.

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Additionally, Nielsen’s data comes only from customers in the United States, and Netflix has made an aggressive play in international markets. Of its roughly 104 million paying subscribers, a little more than half live outside the United States, according to Netflix’s third-quarter earnings.

Earlier efforts to sleuth out streaming ratings have faced criticism. Last year, NBC executives released some Netflix ratings data from a company called Symphony Advanced Media, which similarly used audio fingerprinting technology from a panel of 15,000 people who downloaded a special app.

Netflix’s chief content officer, Ted Sarandos, said the numbers gathered that way were inaccurate. Moreover, he said, because the company relied on subscriptions and not advertising, they were irrelevant. (The 2016 measure focused on the 18-to 49-year-old demographic coveted by advertisers.) Symphony stopped measuring Netflix ratings earlier this year.

Nielsen said its numbers would be more reliable.

“It’s far, far superior,” Ms. Clarken said. “Symphony was a small panel. It wasn’t recruited in any kind of capacity to the gold standard that we recruit, so there’s no representation in there. And it was very small.”

“It provided interesting analytics,” she continued. “Our goal is to go well beyond interesting analytics. This is about providing a ratings equivalent to a high quality ratings service.”

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Article source: https://www.nytimes.com/2017/10/18/business/media/nielsen-netflix-viewers.html?partner=rss&emc=rss

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