Inside the Company Behind Netflix's Measurement War
The entire TV industry is aching for any glimmer of insight into viewership for Netflix, which has promised never to reveal audience data for its shows. And one company is claiming it can provide it without Netflix's cooperation.
The company is Symphony Advanced Media, a four-year-old tech firm backed by Romesh Wadhwani and his private equity firm Symphony Technology Group. Led by president and CEO Charles Buchwalter, who spent 13 years at Nielsen, Symphony uses audio recognition to measure traditional and streaming programming viewership across devices.
NBC's research president, Alan Wurtzel, caused an uproar at the Television Critics Association Winter press tour last week when he revealed Symphony data estimating that Netflix's "Jessica Jones" averaged 4.8 million viewers among 18-to-49-year-olds over a 35-day period, "Master of None" averaged 3.9 million in the demographic and "Narcos" averaged 3.2 million.
Netflix Chief Content Officer Ted Sarandos fired back, saying the data is "remarkably inaccurate." But at least several big TV groups are testing Symphony's measurement product.
When Symphony debuted in 2012 its focus was on providing custom research to marketers and ad agencies on cross-media advertising effectiveness, Mr. Buchwalter said.
Then in 2014, identifying a need in the industry to track and understand cross-platform viewing, the San Francisco-based company moved away from custom research and spent the past year and a half creating a subscription measurement service.
"Nielsen has tremendous depth in TV and ComScore has tremendous depth in digital," Mr. Buchwalter said. Symphony is working to seamlessly blend the two, he said.
The result, VideoPulse, debuted in September, with NBC, Viacom, Warner Bros. and AMC among participants in a pilot program. It extrapolates audience figures from panelists who download an app that runs in the background of their mobile devices or PCs, listening to identify the content they watch. A GPS component can track where people are accessing content, whether at home or on the go.
To recognize shows, Symphony partnered with Tribune Media's Gracenote, which compiles audio fingerprints on vide programming that lets VideoPulse to identify a particular series, episode and network. Gracenote ingests programming content from 210 TV channels along with original programming content from Netflix, Hulu, Amazon and Crackle as their shows come out.
While VideoPulse can track viewing that happens in the seven-day viewing window on which a growing number of ad deals are based, its focus is on viewership over a longer period, which Mr. Buchwalter said represents as much as 35% of viewership.
To come up with its rating, Symphony tracks the viewing of any episode of a series over 35 days, then averages that total to determine a per-episode rating. It provides breakdowns by demographic and by viewership within seven days and beyond.
Because it can identify both linear and streaming video, VideoPulse can measure how many people are watching previous seasons of Fox's "Gotham" on Netflix, for example, and then decipher how many of those viewers go and watch the current season live, Mr. Buchwalter said.
Symphony currently has a sample size of about 15,000. Mr. Buchwalter said he expects that to grow to 20,000 by the end of the quarter. The focus right now is ensuring that the panel is representative of the U.S. population, he said.
The passive nature of VideoPulse and its ability to measure across devices has made it attractive to media companies like Viacom, owner of cable networks including MTV, Nickelodeon, BET and Comedy Central.
Viacom is beta-testing Symphony as it searches for ways to account for viewing taking place on platforms and devices that Nielsen currently doesn't measure, said Colleen Fahey Rush, exec VP-chief research officer, Viacom Media Networks.
VideoPulse doesn't require any backend work on the part of TV networks or other distributors, a requirement that has been one of the biggest complaints among TV executives about getting Nielsen's Total Audience Measurement up and running.
Of course, Symphony's VideoPulse product is still very new, and as such has plenty of kinks to work out.
"The methodology is not perfect," NBC's Mr. Wurtzel said. "They have only been providing data for six months. They have hardly been around long. There are plenty of growing pains."
FX Networks CEO John Landgraf expressed doubts over the data at TCA, saying "it doesn't feel rigorous enough."
The biggest hiccup is Symphony's ability to measure time-shifted viewing. While it can recognize whether a person is watching a show on a delayed basis, it cannot identify how the show is being watched -- via video on demand, a DVR or the internet.
When it sees that a program is being viewed out of the live window, it prompts the viewer and asks them how they are watching, Ms. Fahey Rush said. The reliance on panelist responses can lead to inaccuracies.
Mr. Wurtzel said some of the data he has received from Symphony just didn't look right, and he had to go back to the company to reevaluate its accuracy.
While in no way is Symphony anywhere close to overtaking Nielsen as the TV currency of choice, Ms. Fahey Rush and Mr. Wurtzel both said it shows potential, and at the very least provides some picture of the viewership that Nielsen isn't measuring.
"Nielsen isn't going away," Mr. Wurtzel said. "But I am not seeing from Nielsen what Symphony is showing me. They actually have cross-platform consumption data from September."
And as is the case for any budding TV measurement product that even shows an iota of ability to take on Nielsen, the hope is Symphony will encourage Nielsen to raise its game.
As Symphony works to perfect VideoPulse, it is also planning to expand its measurement to commercial viewing. VideoPulse currently only measures shows, but Mr. Buchwalter said he is confident Symphony can replicate the product to encompass advertising as well.
To this end the company has partnered with iSpot, a database of national TV commercials, and will begin testing commercial measurement this spring with clients.
Mr. Buchwalter also sees an opportunity for Symphony to bring its TV data to the world of programmatic advertising. He expects to partner with a data management platform to help power programmatic advertising later this year.