Refereeing the Streaming Wars: The Regeneration of Third-Party Audience Metrics

Curator's Note

[See the full video “Frontline at the Streaming Wars” from the 9th Annual Cross-Platform Video Measurement and Data Summit]

In a television ecosystem conventionally reliant on a shared currency of audience analytics, the rise of streaming sites like Netflix and Amazon Prime that collect hordes of their own data about viewership on their platforms while keeping it close to chest, trickling out only selective intel for promotional purposes, have changed the game. 

But as the streaming landscape becomes increasingly competitive, the shroud of secrecy around viewership might start to fade away. This is evident in recent conversations with Netflix CEO, Reed Hastings, where he’s backed down from his disavowal of Nielsen’s new SVOD ratings, admitting that third party measurement will play a key role in refereeing success during the streaming wars. While Netflix is used to relying on subscription rates as its marker of success, Hastings explains (2:00) that in the streaming wars “you’ll hear some subscriber numbers, but [Apple and Disney] can just bundle things in, so that’s not going to be that relevant.” He says, “The real measurement will be time. How do consumers vote with their evenings?...Starting Q1, we’ll start to see a breakout from Nielsen and others.”

No doubt, Hastings’ change of tune has been motivated by the advantage that incumbency gives Netflix in Nielsen’s metrics—having a third-party referee legitimizing Netflix’s wins fits into the streaming giant’s plan to up its promotion of original content. Netflix’s Ted Sarandos has described viewership data as cultural metrics: “Being able to share some of those numbers gives people a better sense of what things they might be interested in as well.” Amazon Prime has become similarly looser-lipped about it viewership numbers in the past few months, and looking forward, the streaming wars may likewise provide incentive for other subscription-supported sites like Disney+,  ESPN+, and Apple to participate in the third-party measurement game merely to be part of the conversation. 

Certainly, for ad-supported streaming sites, the need for a third-party currency is more imperative. In the above segment from the “Frontline at the Streaming Wars” panel at the 9th Annual Cross-Platform Video Measurement and Data Summit, representatives from Hulu, NBC Universal, CBS Interactive, and Warner Media discuss the stakes of a shared audience ecosystem and the importance of continued collaboration with third-party measurement firms like Nielsen and Comscore.

AVOD platforms are banking on the lower price point that they can offer due to their partial reliance on advertiser funds being their advantage over Netflix. Advertisers are eager to take advantage of the addressability capabilities afforded by connected-TVs, where 70% of streaming occurs. Magna Global predicts that the streaming advertising market will grow by 30% in 2020, surpassing $5 billion. But to take advantage of this new landscape, advertisers need to be able to compare services holistically in order to match content to impressions across the streaming ecosystem as efficiently as possible. Nielsen’s recent move into SVOD ratings and acquisitions of Gracenote, an automated content recognition system, and Sorenson Media, which provides technologies for executing addressability, indicate that the firm is positioning itself in an effort to meet this demand.

To be sure, the role of shared audience currency will never be what it was— it is unlikely that a firm like Nielsen will ever have the refereeing power that it had during the broadcast era. More likely, what will emerge is a television landscape where platforms will leverage their own data for development and attribution and to highlight their own strengths—whether it be audience breadth, loyalty, or demos—while also participating in a shared audience ecosystem, managed by a third party firm like Nielsen or Comscore, that enables advertisers to plan across a variety of streaming platforms. 




Really interesting post Jennifer, on how audience numbers and subscriber numbers might be measured more transparently by third party metrics such as Nielsen.

But for me, also the video addresses the significant issue that individual streaming platforms have distinct business models – Disney+ as a Walled Garden as I argue, even Hulu as explicitly mentioned by Julie DeTraglia, whilst Amazon Prime Video is a loss leader for the delivery service. So Reed Hastings might be keen on the public availability of comparable viewing figures for Netflix Original series against The Mandalorian or the future Amazon Prime Lord of the Rings series, since Netflix’s current investment in exclusive Original content is its principle focus (aside from its long established proprietary algorithmic recommendation system of taste cultures). And it’s the market leader. Whereas the legacy media conglomerates are still defined by their film and television libraries and Intellectual Property. In the case of Disney this is exemplified by the Disney Vault titles, as well as the MCU, Star Wars, Pixar and live-action reimaginings that have enabled the company’s dominance of the theatrical box-office for the last few years. These underpin the company's franchising and synergy, driving the company's other divisions, and exemplify the Long Tail model on which the company has, at least partially, grown during the Home Entertainment era.

Really useful conclusion that each platform will emphasise different measures for different purposes - audience breadth, loyalty, or demos - whilst also exploiting their internal data analytics to respond to the changing ecosystem and differentiate their offering.  

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