India tv ratings controversy: the emm analysis

TV violence in India has recently been on the rise. And that’s just the audience measurement system!

A noisy public dispute has broken out between an Indian TV network, the TV ratings service measuring national TV viewership, and assorted advertising trade bodies. Now India’s government is weighing in. EMM is concerned at these developments, and has suggestions for how to resolve differences between the parties to this escalating dispute. We all need to put the brakes on a runaway train before it smashes into the buffers.

For several weeks, an acrimonious fight has been conducted in Indian TV news reports, business press and advertising trade publications. A row that has simmered for years has abruptly boiled over. It concerns television audience measurement and the Indian national TV ratings service supplied by TAM (a Kantar company in the WPP Group) for over a decade. Powerful TV interests (notably the NDTV network) have been accusing the TAM service of corruption and systematic rigging of audience results.

Conflict has rapidly escalated into multilateral finger-pointing and lawsuits, in an atmosphere of increasing hysteria and mutual vituperation. Broadcaster NDTV has filed a 160-page lawsuit against TAM in a New York court, alleging flawed methodology and corrupt manipulation of their ratings service, aimed at systematically depressing NDTV reported audiences by around 60%. Allegations of bribe-taking are implicit in the suit. Kantar/WPP, TAM’s proprietor, has repudiated the lawsuit and the accusations, but has presented a six-point action plan to address concerns about its ratings data.

Meanwhile an industry technical committee is being formed to oversee the design of an audience measurement system for television in India, under a newly-constituted Broadcast Audience Research Council (BARC). This tripartite body is a joint entity comprising broadcasters, advertisers and advertising agencies, owned in a 60/20/20 ratio, though its funding ratio is still disputed. Selection of ratings suppliers and ancillary services will in future be a BARC responsibility. However, as of this writing BARC is not yet operational, pending ratification of its articles of association, partly because of money wrangles between its constituent members.

Now broadcast interests have called on the government to intervene, to conduct a third party audit to evaluate the current ratings system, and to suspend the TAM service indefinitely while the matter is investigated and resolved. A council set up by India’s Information and Broadcasting Ministry has responded by calling for TAM to be replaced by an alternative service.

It seems to EMM that, at virtually every level, all this has more to do with grand-standing than problem-solving. Those responsible for the smooth running of a vast national TV advertising market have chosen a dangerous and potentially damaging course of action. Accusing the official ratings supplier of lying can certainly draw attention to a grievance, but it can only debase the currency on which the buying and selling of TV airtime depends. Upholding such accusations without the benefit of proven facts can only aggravate that danger.

As a leading international media management consultancy, EMM has many years’ international experience of TV audience ratings disputes, and offers the following advice to the warring factions, as a way out of an ugly confrontation and its potentially destructive consequences.

TV ratings are a basic currency of advertising buying and selling, and throughout the world they are mostly supplied by an industry-nominated monopoly. The provision of ratings is somewhat similar to the functioning of a stock market, of which most countries have only one. If there were two competing stock exchanges, and traders could pick and choose the valuation of a company’s worth, the result would be chaos and a loss of confidence in market values.

For the same reason, TV ratings provision is one rare business in which a monopoly supplier is not only allowed, but actively mandated by the ad industry in most countries. Self-evidently, such a monopoly can be highly lucrative, and should not be given away lightly. Nor should its licence be renewed without periodic scrutiny of the supplier’s performance, a watching brief on methodology, and every so often a review of alternative suppliers.

However, it seems to EMM that abandoning overnight a long-standing system when there is no reliable alternative in place is a recipe for disaster. A TV advertising industry without trusted ratings from a professional source is a ship without a rudder. Furthermore, setting up a new ratings system with new panels is a major undertaking, vastly expensive and time-consuming, and prone to protracted teething problems. It is not to be approached in a heated moment.

There have been a number of cases internationally in which disgruntled TV stations tried to “shoot the messenger” and repudiate the official ratings supplier. They rarely worked out the way the aggrieved broadcasters imagined. The law of unintended consequences generally applies:

1. 
   Early disputes over the accuracy of rival rating systems in the UK were eventually resolved by the creation of a JIC, a joint-industry committee comprising representatives of broadcast companies, advertisers and advertising agencies. The committee set up BARB, the Broadcasters' Audience Research Board, which in its turn awards and supervises TV audience measurement contracts. This system is still regarded as a worldwide industry gold-standard. The Indian equivalent to BARB is BARC.
   
2. 
   In the USA in the 1990s, the TV ratings monopoly supplier AC Nielsen was coming under fire from national TV networks, for alleged discrepancies in the way it reported audiences. The British ratings company AGB mounted a long, expensive and bitter battle to unseat and replace Nielsen in the USA. The end result was that Nielsen overhauled its systems and retained its monopoly position, while AGB lost its investment and retired from the battlefield defeated.
   
3. 
   In Colombia recently, the TV ratings monopoly-holder IBOPE was denounced by terrestrial TV broadcasters for allegedly mis-reporting their audience size. A boycott of IBOPE was mounted, and a group of broadcasters threatened to replace its service with their own new system. That effort collapsed after about a year, when it was realized that cost and logistics would prevent the alternative service from being viable.
   

1. 
   The issue should be dealt with by Indian trade bodies in India itself, avoiding unnecessary cost and delay in the courts (especially foreign courts), but with the benefit of precedent and experience in other markets.
   
2. 
   All participants to the dispute should consider carefully whether litigation is the correct avenue for seeking solutions.
   
3. 
   Public accusations of lying and bad faith tend to lower the debate and debase the currency. It would be better for all parties to draw back from the current finger-pointing, and hammer out their differences equitably through an expert-driven debate on samples, methodology etc.
   
4. 
   A Joint-Industry Committee (JIC) like BARC needs to be fully constituted to oversee TV ratings supply in its entirety. Its deliberations should cover not only today’s TV audience measurement requirements, but tomorrow’s too. This will be particularly important in terms of emerging demography, TV service fragmentation and proliferation, and technical advances.
   
5. 
   Once constituted, BARC should mandate that TAM’s methodology should be validated, and a representative sample of TAM ratings reports examined by independent experts. Though ‘doctoring’ average audience deliveries might be relatively easy, it is in fact fiendishly difficult to manipulate all the details of a weekly viewing record so as to give a falsified overall result. If such trickery has indeed been perpetrated, expert eyes will detect it.
   
6. 
   TAM’s new proposals for improving their system deserve serious examination by a competent committee of experts, as well as the parties concerned. If agreed, they should be implemented as soon as possible. The idea of suspending the TAM service, however, would leave the market without a currency to operate by, which could quickly inflict serious commercial damage on India’s ad industry. TAM should continue to operate in the interim period.
   
7. 
   Serious tenders from alternative suppliers should in due course be invited, under a disciplined system to be agreed by BARC. However, it has to be said that setting up a new service with a new panel, equipment, processing and administration is an immense undertaking, not to be undertaken lightly or for short-term reasons. Anyone attempting it should be clear about the money and time required. As an example of the potential pitfalls, new ratings panel members’ viewing records are often considered unusable for the first few months, since one early effect of living under the research microscope can be to distort reported viewing patterns; viewers who normally watch variety shows may temporarily switch to highbrow or religious programming to impress the researchers.
   
8. 
   As a preliminary step, BARC should consider instituting an Establishment Survey of Indian television audiences. This is an interim procedure that defines the TV universe, sets the size and composition of the national sample required, dictates panel recruitment procedures and timelines, and mandates durable quality controls. To ensure the necessary checks and balances, BARC should assign this task to a different research organization from the one(s) which will eventually be candidates for gathering and propagating the viewing data itself.
   
9. 
   Ratings-service funding issues should be dealt with separately from the controversies over supplier choice, trust and methodology. The industry should continue to aim for a tripartite funding system. Broadcasters should probably shoulder the main financial burden, as they do now in India and in other countries; they plainly need a selling currency to continue in business. But if advertisers and their agencies dodge all financial commitment, they risk ending up isolated and voiceless. Only joint funding preserves a tripartite voice over time, and helps to keep the system honest. It would be a pity to abandon it.
   
10. 
    Finally, a solution based on the above obviates government intervention.
    

There can only be one national TV ratings supplier. It needs the support of all branches of the industry, it should be answerable to a permanent Joint-Industry Committee comprising broadcast companies, advertisers and agencies, and it should ideally be jointly funded by those three parties.

As Daniel Patrick Moynihan, the late US senator and onetime ambassador to India once said, “Everyone is entitled to his own opinion, but not his own facts.” Those wise words seem particularly relevant to this dispute.

For further information contact:

Stephen White