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Says It Has No Reason to Impose Measurement Standards

By Published on .

WASHINGTON (AdAge.com) -- The Federal Trade Commission said it will not get involved with or monitor Nielsen Media Research's rollout of a new measuring system, local people meters.
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In a letter to Rep. Albert Wynn, D-Md., sent last week but released yesterday by Nielsen, FTC Chairman Deborah Majoras said its staff examination and talks “do not show that Nielsen has engaged in deceptive or unfair practices in violation of the FTC act such as misrepresenting its ratings system or failing to disclose material facts about the omission.”

Nielsen is looking to replace its current paper-based method of tracking audience viewership with an electronic system known as the local people meter in major markets.

Undercounting minorities
Members of Congress, minority groups, Hispanic broadcasters and the Fox Broadcasting Co. have argued since Nielsen unveiled its local people meters that the new system would undercount minorities in major markets.

"The audience for Nielsen's statements about its ratings services consists largely of media companies, many of which are highly sophisticated and capable of evaluating the information Nielsen provides,” Ms. Majoras wrote. She said that any system would have "shortcomings" and that "Absent deceptive or unfair practices, it would not be within the commission’s authority to impose quality standards for accuracy in audience measurement."

Media Ratings Council
The FTC said the best approach to any monitoring problems is a voluntary one through the Media Ratings Council, an audience-measurement audit body. Nielsen has been working with the council since launching the system in Los Angeles last year.

"The commission determined clearly that the marketplace is working and there is no need for government regulation of TV ratings," Nielsen said in the statement. "It effectively confirmed what the California Superior Court ruled last summer -- that there is absolutely no basis for self-serving claims that our ratings are misleading or deceptive, or that we have engaged in unfair or anticompetitive practices."

The Don’t Count Us Out Coalition, which was formed to oppose the local people meters, said it was “disappointed but not surprised” by the FTC action.

“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,” said the statement from Executive Director Cynthia Rotunno-Jasso. “Undercounting and inaccurate reporting of data, particularly from our communities of color, hurts all of us."

New technology
People meters are a new computerized technology designed to replace the old paper diary records that Nielsen has long used to produce U.S. TV program viewership ratings. The ratings, which are used to set the price of advertising, also play a major role in the survival or demise of specific programs, and are crucially important to advertising and media-buying agencies as well as other companies involved in the financing, production and distribution of TV content.

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