Lucent, the AT&T spinoff that includes the highly regarded Bell Laboratories, and Nielsen will work on three projects: technology for encoding digital TV; low-cost data collection to increase TV viewer sample size; and measurement of TV commercials, said an executive close to the companies.
The deal comes as Statistical Research Inc. is in final stages of deciding whether to take its fledgling SMART technology and use it to develop a national competitor to Nielsen in TV measurement and ratings.
SRI has met with IBM Corp. to see if it is interested in becoming a partner or investor in the proposed new service, insiders said.
SRI declined comment.
Nielsen believes advertisers, agencies, TV networks and TV stations would all be interested in getting more comprehensive demographic data about TV advertising than Nielsen routinely provides.
"They feel it can be a very lucrative service," said the executive close to both companies.
Lucent also is expected to help Nielsen find a way to increase its sample size through use of low-cost metering technology. A number of TV network and agency managers have complained that Nielsen's panels are too small.
Another area where Nielsen plans on exploiting Lucent's expertise is in the encoding and decoding of TV signals as the industry moves to a digital world.
"The new agreement enables Lucent and Nielsen Media to combine our professional resources to develop technology with broad applications for our respective businesses," said Victor Lawrence, Lucent's director of advanced communications technology. He said they will share their "expertise in analog and digital audio and Internet communications to create new business opportunities."
"Lucent is the world-class company in communications technology, and they are very involved in many facets of digital technology," said John Dimling, Nielsen president-chief operating officer. "It's the perfect marriage of our expertise on the media side with their communications technology capabilities."
Lucent has contacts outside the U.S., and future joint services could become international in scope. Nielsen Media Research, though a division of a global company, Cognizant Corp., has mostly confined its business ventures to North America.
Mr. Lawrence said he was impressed with Nielsen's development of its active/passive meter, designed for measuring both coded and uncoded digital TV signals.
One of the challenges facing any company measuring TV viewing in the digital age is figuring out what shows are being watched in the household.