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This week, Nielsen announced its new "Internet Meter" will be available by the end of the year. But it won't actually be useful until 2011. And the cable companies' plans for TV Everywhere are likely to be put off until 2014. While television companies are talking a lot about putting their premium content online, it could be awhile before this becomes serious business.
Nielsen has long been the leader in television measurement, but networks and advertisers have problems with the way the company collects its data offline. Online their is no set standard to gauge viewership. While companies like comScore, Compete and Quantcast all have online measurement products, networks and advertisers question their methods.
Last month, some of the major networks, together with a few advertisers and media agencies, announced plans to create their own measurement system.
Without an industry standard, companies can cherry pick the numbers that most benefit their purposes. Web video purveyors like to use measurements that increase their audience size (Hulu recently dumped Nielsen numbers for comScore because they estimated a larger audience size. Advertisers prefer measures that make the ads cheaper.
Nielsen has the advantage of impartiality and scale over some of the competion getting into the measurement field and says its "Internet Meter" software will be deployed by the end of 2009 to a test group of households. But full implementation the company's online panel of over 230,000 individuals won't happen until 2011.
Meanwhile, both networks and advertisers are hesitant to jump online with both feet until they have a better picture of the online audience.
If they can prove that viewers are watching online, they can charge decent rates for advertising. But the viewership numbers differ.
Recent statistics from the Conference Board show that online viewing is on the rise. One study this week said that 25% of American households watch TV online. Meanwhile, Nielsen said this Spring that 99% of video viewing is still happening in front of a television set.
While advertising online might not bring in as much revenue at the moment, there are features that make it more beneficials to video creators. For starters, the ads cannot be skipped, meaning that online viewers have to sit through an entire ad before or while viewing video content.
But networks have a reason to be hesitant. One exec tells ReadWriteWeb:
"We're not like cable, which has a second revenue stream from subscribers. We need to amortize these very expensive shows."