Worries linger about Nickelodeon's ratings slump

Wall Street analysts peppered Viacom management Thursday with questions about the mysterious ratings slump at the company's premier children's television network Nickelodeon.

Nickelodeon's audience levels have fallen nearly 30% this season, prompting much speculation about the reasons behind the troubling drop. The issue is far from child's play. Nickelodeon is one of the most valuable channels in television as well as within the Viacom universe. 

Some analysts have theorized that the weak ratings could be attributed to shifts in viewing behavior. More children are watching Nickelodeon shows on demand through Netflix and Amazon.com digital streaming services, rather than watching the channel. 

Earlier this week, Time Warner Inc. Chief Executive Jeffrey Bewkes added his support to that theory, noting that his company's Cartoon Network, which competes with Nickelodeon, doesn't have that issue. In fact, Cartoon Network's ratings were up 14%.

 "We think part of the reason is that we don't have our programs sitting on an SVOD [subscription video-on-demand service] where parents can park their kids," Bewkes told analysts during Time Warner's earnings call Wednesday. "Obviously, that's taking some viewing away from some of the other animated channels."

Viacom executives pooh-poohed the theory.

"Netflix is present in less than a quarter of television households, and since we get the streaming data on our content, I can tell you that the time spent on Nickelodeon content on Netflix is approximately 2% of the time spent on our Nickelodeon channel," Viacom Chief Executive Philippe Dauman told analysts Thursday during his company's second-quarter earnings call.

"It would have a minimal impact here," Dauman said.

Instead, Viacom traces much of the ratings nosedive to a September change in the composition of the audience panel that Nielsen uses to derive its ratings. New participants in the Nielsen panel apparently watch less Nickelodeon than those they replaced.

Still, analysts are concerned.

"Nickelodeon has fallen to levels that you've never seen before," said one prominent analyst, Michael Nathanson of Nomura Securities, observed during Viacom's call. 

Nickelodeon's problems failed to dent investors' enthusiasm for Viacom's stock. The company's widely traded B-shares closed Thursday at $49.02 a share, up $1.59 a share.  Viacom reported a profit increase of 56% over the year-earlier period.  Revenue was up 2% to $3.33 billion.  

"We're going to focus on ways in which we can affect the Nickelodeon brand positively," Dauman told analysts before the opening bell. "Our pipeline is extremely strong. We're developing more new [episodes] of our popular series and more exciting new series. And of course, we're particularly excited about the revival of the [Teenage Ninja] Turtles franchise."

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Photo:  A scene from an older episode of "SpongeBob SquarePants." Credit:  Nickelodeon 

Nielsen study finds 'second screen' viewing enhances TV experience

 

When viewers watch a TV program with a tablet device, they tend to check their email, hunt for sports scores or seek additional information about the show or a commercial they were watching on the big screen.

A new report by Nielsen Co., released Friday, underscores what network television researchers have been preaching for more than a year: that "second screen viewing" appears to augment the TV viewing experience rather than steal away viewers.

Nielsen's State of the Media: Advertising & Audiences report found that men, when watching TV and using a tablet simultaneously, were more likely than women to look for information related to a TV program they were watching (39% versus 34%). Women were more inclined to seek information related to a television commercial  (24% versus 21%).

Not surprisingly, teenagers with tablets were far more apt to visit a social media site while watching TV than were older baby boomers and seniors (62% versus 33%). 

The report also found cultural differences in TV watching and the use of digital video recorders. Nielsen said that white TV viewers use digital video recorders on a daily basis twice as much as any other group, while Asian Americans appear to spend a higher proportion of their overall TV time watching their previously recorded programs.

Adults age 25 to 54 appear to be heavily influenced by advertising. Nielsen said that demographic group was 23% more likely than the average U.S. Internet user to follow a brand through social networking sites, and 29% more likely to purchase a product online that had been featured on TV.

Finally, teenagers used a game console for eight minutes a night, on average -- more than twice as much as the general TV population.

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-- Meg James

Photo:  Klarysa Clark, a teenager from Eagle Rock, checks out a 3-D television at the Atwater Village Best Buy in Los Angeles in June 2010.  Credit: Jay L. Clendenin / Los Angeles Times

Nielsen study finds that dramas are recorded at higher rates

In a new study of television audience trends, ratings giant Nielsen found that viewers recorded and watched scripted dramas at a much higher rate than sitcoms, sports and reality shows.

Hourlong dramas accounted for 58% of time-shifted viewing, according to Nielsen's Advertising & Audiences Report released Thursday. Comedies made up 16%, reality shows accounted for 14%, sports represented 8% and news, 4%.

Network executives are closely monitoring audience trends now that more than 40% of all TV households in the U.S. are equipped with digital video recorders.  Many viewers fast-forward through the commercials, which have long generated the dollars that support the high cost of television production.

The Nielsen report found that nearly 43% of people who digitally record shows watch the episode the same day. Nearly 88% of people who recorded a program watched it within three days. 

The finding is significant because advertisers currently pay the networks for viewers who record and watch an episode within that three-day window. Some network executives are lobbying advertisers to extend the period to seven days.

Nielsen said that dramas drew 41% of the viewers in prime time and generated 35% of the television advertising dollars. Reality shows, once red-hot, have cooled slightly. In 2011, they attracted 15.5% of the prime-time audience, down from 17.4% in 2009.  Meanwhile, sit-coms have become more popular.

Last year, $72 billion was spent on TV advertising in the U.S., with $14 billion allocated for the five leading prime-time genres: dramas, comedies, sports, news and reality shows.

Advertisers spent $4.1 billion last year in prime-time sports, which accounted for 29% of the total. 

And not surprisingly, more than half the product placements on the major networks during prime time occurred in reality shows (4,664 occurrences).

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Graphic: Advertising and audience trends in prime time.  Credit:  Nielsen

Nielsen's new Digital Consumer Report examines 'Generation C'

At the start of the decade, Nielsen talked about "Generation C," or the connected generation.

It was a group of teens and 20-somethings who came of age in the time of Myspace and Facebook, who used mobile devices and social media platforms to remain constantly in touch with their "tribes" --  people who share common interests, causes or movements.

Nielsen's and NM Incite's newly released State of the Media: U.S. Digital Consumer Report underscores just how connected this group truly is. Americans ages 18 to 34 make up just 23% of the population, but they represent an outsized portion of consumers watching online video (27%), visiting social networking/blog sites (27%), owning tablet computers (33%) and using a smartphone (39%).

Radha Subramanyam, Nielsen’s senior vice president of media analytics, said this group is instantly recognizable: They're the ones furiously texting, even while sitting in a roomful of people. They don't think twice about pulling out their mobile phones in a fancy restaurant.

"When we start marketing them, we have to think differently," Subramanyam said. "They're consuming all different kinds of media, and they expect a direct relationship with brands.... This voracious device usage, which is almost an extension of their fingers, is tied to [their] expectations for instantaneous gratification and instantaneous response from brands."

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Photo: A group of friends play on iPhones and an iPad outside the Pasadena Apple store in October 2011. Credit: Irfan Khan / Los Angeles Times.

Viewers watching more streaming video on game consoles

Video game consoles aren't just for gaming anymore.

Increasingly, people are using their Xbox 360, PlayStation 3 and Wii devices to stream movies and TV shows, according to a survey released Wednesday by the Nielsen Co.

Because all three consoles readily connect to the Internet, viewers can use them to access video-on-demand services like Netflix, Hulu Plus, YouTube, Major League Baseball Network and ESPN to watch on their TV screens rather than on small computer monitors.

And that seems to be just what consumers are doing. Streaming video accounted for 14% of the average time spent using Microsoft Corp.'s Xbox 360 in October, up from 10% a year earlier, according to a Nielsen survey of 3,000 people.

For Sony Corp.'s PS3, the share of streaming video was 15% this year, up from 9% last year. The shift was even more dramatic for Nintendo Co.'s Wii, which jumped to 33% from 20%.

Xbox and PlayStation users also spent an additional 5% of their time watching movies and television shows they paid to download, an option not available on the Wii.

That's good news for studios looking to make more money through digital distribution. Game consoles, along with the Apple TV, are the most popular ways to reach people who want to watch video on their high-definition televisions.

It's more troubling for television networks seeking to boost their ratings and ad revenue, however. The new data emphasize that consoles aren't stealing viewers' attention just with video games but also with content that serves as a direct substitute for traditional TV watching.

Game consoles have proved particularly effective for Netflix. An earlier Nielsen survey found that half of the users who utilize its streaming offerings do so on the PlayStation, Xbox or Wii.

Two of the consoles are also popular as DVD players. People spend 15% of their time on PS3s watching DVDs or Blu-ray discs. Sony's device is the only console that plays Blu-ray discs and is the best-selling Blu-ray player on the market. Xbox 360 users spend 9% of their time watching DVDs. The Wii does not play movies on discs.

Below is a Nielsen chart summarizing the survey results.

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Photo: The Netflix interface on Xbox 360. Credit: Netflix Inc.

Cable is the only cord getting cut

For the last year, top cable industry executives have dismissed the idea that consumers are cutting the cord and opting to get their content online.

Turns out they're right. Consumers are cutting the cable cord, but not for the Internet. Instead they're signing up with satellite companies and phone companies offering the same services.

According to a study released by Nielsen, the media research company that tracks television viewing trends, 91% of U.S. TV households had a subscription service in the first quarter of 2011. Of that 91%, 53.8% had cable subscriptions, while 30.2% had satellite television and 6.7% used a service from a telephone company such as Verizon Fios.

That is about flat with the first quarter of 2010. However, both satellite and telco video distribution services saw growth, while cable fell by almost 2%.

While that 91% figure is reassuring to multichannel video programming distributors, there are clouds on the horizon. The Nielsen study warns that younger Americans are spending an increasing amount of time watching content online. Kids between the ages of 12 and 17 spend a third of their time on the Internet watching video. The largest group watching content online are adults 35 to 49. By ethnicity, Asians watch far more video online than do whites and other ethnic groups.

Concern about competition and the economy starting to pose a threat to the cable industry is a theme at the National Cable & Telecommunications Assn.'s annual convention this week in Chicago. At a panel filled with top industry executives, there was acknowledgment that the gravy train of subscriber fees is not a sure thing.

"There clearly is a growing underclass of people who can't afford the services they want. It would behoove all of us to work together to meet the needs of that population," said Time Warner Cable Chief Executive Glenn Britt. "Most of the people want everything, but not everyone can afford it."

Television remains the dominant platform, and small-screen viewership jumped 22 minutes a month for the average consumer to 158 hours and 47 minutes for the first quarter of this year compared with the same period last year. Nielsen said African American households continue to consume the most television, watching 212 hours and 53 minutes per month. Whites are next with 155 hours and 33 minutes, followed by Hispanics with 135 hours and 42 minutes and Asians with 100 hours and 25 minutes.

-- Joe Flint

 

 

Nielsen study: We're still a nation of couch pumpkins

TV watching continues to be America's favorite pastime.

In its "State of the Media: TV Usage Trends," the Nielsen Co. said Thursday the average person watched more than 143 hours of television a month during the second quarter of 2010. (Nielsen, however, stopped short of exploring potential causes of airwave rage. This week a Wisconsin man shot his television after Bristol Palin advanced to the final round of ABC's "Dancing With the Stars.")

And while the rate of TV consumption was "essentially flat compared to the same period a year ago," Nielsen said that people are indeed watching a little differently.

"The emergence of the DVR as a widely distributed device has changed viewing behaviors in many homes," the research firm said. The average person who has a digital video recorder watches more than 24 hours a month of recorded shows.

Not surprising is that younger viewers -- particularly those aged 25 to 34 -- were more apt to use DVRs.  "That demographic watched 29 1/2 hours of DVR playback per month," the Nielsen report said. That represents a 20% increase over older viewers' usage.

The trend suggests that traditional network scheduling patterns eventually will become less important. Broadcast networks have already begun to feel the pinch as dramas running in the 10 p.m. hour have been getting smaller audiences. Ten o'clock appears to be prime time for DVR viewing.

Similar to past findings, teenagers watch fewer hours of television. Viewing increases as people get older and more settled. Nielsen also said that women watch more TV than men, 54% to 46%.

Nielsen did not offer corresponding statistics on the size or fitness of American TV viewers. But given recent studies on eating habits and obesity, it seems appropriate to replace couch potato with couch pumpkin.

-- Meg James

Ohio: brutal winters and political ads clogging TV airwaves

Ohio has earned its reputation for being a politically restive state. The Nielsen Co. on Friday offered more evidence in its analysis of political advertising during this past election season. 

Nielsen found that Cleveland and Columbus had the highest concentration of political ads of any metropolitan area -- more than cities in other key battleground states including California, New York, Nevada and Colorado. 

American TV viewers, according to Nielsen, were exposed to nearly 1.48 million political commercials in October -- an increase from 1.41 million political ads that ran during October 2008, leading up to the presidential election. "It was the largest political ad output on record in what is traditionally known as the busiest month of the year for political messaging," Nielsen said.

The ratings giant tabulated commercials transmitted by local broadcast stations in the top 128 television markets. "Cleveland stations aired the highest proportion of political and issue advertising," Nielsen said. "About one out of every four paid TV ads aired on local Cleveland stations was placed by a political candidate or outside political group."

Columbus, the state capital, came in second in the Nielsen ranking with an estimated 23.37% of paid ads bought by political entities.

Interestingly, the next speaker of the U.S. House -- Republican John Boehner -- also hails from the Buckeye State.

Three West Coast cities -- Portland, Sacramento and Seattle -- rounded out the Top Five. The Nielsen data might come as a surprise to viewers in Los Angeles. Analysts determined that more money was spent on campaign ads in Los Angeles than in any other market, including New York. An estimated $120 million was spent on campaign commercials run by Los Angeles TV stations.

Cities with the lowest political ad saturation levels were Jackson, Miss.; Richmond, Va.; Lincoln, Neb.; Salt Lake City; and Tyler, Texas.

-- Meg James

 

 

Nielsen's deal with ABC on iPad application: The referee joins the game

Nielsen, the company that the broadcast and cable channels pay to provide ratings for their programs, is getting into a side business to help the networks promote their shows.

In a deal announced Thursday, Nielsen is teaming up with Walt Disney Co.'s ABC to create an application for Apple's iPad for the network's new drama "My Generation," which premieres next Thursday at 10 p.m.

Here's how it works. A person watching "My Generation," a drama about a group of high school pals 10 years after graduation, turns on the application during the show. The iPad then gets fed material about the show, which could include a poll about a particular plot point, additional content or social network features. The application will also be able to be used as a marketing device for advertisers in "My Generation" as well. ABC is not getting any data on the users, although Apple will tell the company how many times the application is downloaded.

The "My Generation" application is, of course, just the latest technological twist aimed at generating greater viewer interest and making people feel more involved in the shows they watch.

What makes this interesting, though, is Nielsen's involvement. Nielsen is basically the referee of the television business. Like a referee, the company calls ratings as it measures them in a neutral fashion.

Now the referee is, in a sense, setting up another operation to help teams promote their favorite players. 

A Nielsen spokeswoman stressed its Media-Sync Platform is "not a research product and is completely separate from our ratings service." 

ABC's deal with Nielsen is by no means exclusive. Nielsen said it had contacted other networks and gave them a heads-up and there were no issues. Company Town contacted three other networks; two seemed less than thrilled with the Nielsen-ABC deal and the third was unaware. Come early next year, the platform will be available to all Nielsen clients.

Is this a road Nielsen should be going down? The company's reputation is based on the perception that its sole interest is in providing accurate ratings for the industry and stay neutral on what the numbers mean. Nielsen usually goes out of its way not to comment on ratings and in fact made some waves earlier this year when one executive did offer an opinion on World Cup ratings.

In that case, Stephen Master, a vice president at Nielsen, was quoted calling the World Cup ratings "phenomenal." That may not seem like a big deal, but what if he said the ratings were really bad? Everyone in the industry would be screaming that Nielsen has no place offering an opinion -- especially a negative one -- on the ratings and that its job is to leave the judging to others.

Now it wants to help networks hype shows (and make a buck in the process). It seems like it could be the beginning of a slippery slope. Perhaps, just as Nielsen doesn't want to offer opinions on ratings, it should also leave the promotion and marketing of shows to others as well.

-- Joe Flint

Photo:  "My Generation." Credit: ABC.

World Cup viewing sets two impressive records in the U.S.

You say Americans don't have soccer fever?

You're wrong!

Saturday's nerve-racking match between the U.S. and Ghana was the most-watched soccer game in U.S. history, according to Nielsen Media. The game, viewed by 19.4 million viewers on ABC and Univision, topped the Italy vs. Brazil World Cup final in 1994,  watched by 18.1 million people on those two networks.

Of the 19.4 million who tuned in to ultimately see the U.S.'s soccer dreams slip away this weekend, 4.5 million watched on Univision -- which is on fire during this tournament.

Sunday's Argentina-Mexico match attracted 9.4 million viewers to Univision, making it the most-watched program in Spanish-language television in U.S. history, according to Univision. That's right -- el mas grande!

If you've been watching it on ABC, here's a little taste of what you've been missing on Univision -- a few things we heard from the commentators during the Argentina-Mexico matchup:

"Silence, frogs, the toad is getting ready to speak." (This was about the ref!)

"The ball is very high, very long, ugly and very fuchi." (About a missed goal by Mexico. Fuchi is slang for "stinky").

"He kicked it with soul, life, heart, rancor, potency, energy, hope, faith and, in addition, his right leg!" (About Argentina scoring).

You don't hear anything like that during NFL broadcasts!

-- Maria Elena Fernandez
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