comScores’ Big Acquisition of Rentrak Shifts Measurement’s Tectonic Plates

I have to admit that I was surprised by the news that comScore was acquiring Rentrak. While I expected more consolidation in the media measurement space, I didn't envision that it would be two big players joining forces but rather the continued ingestion of smaller companies by larger companies. But this acquisition is not only a brilliant tactical move, it is also strategic. This might finally move analytics and insights in such a way that the industry shifts from the proxy metric of age and gender and into a more standardize-able cross platform measurement.

The news has caused the otherwise politic and polite “non-competition” between Nielsen and Rentrak to publicly flare up during a panel at Advertising Week. This indicates to me that the measurement space is receiving a boost of attention beyond the usual suspects and even perhaps a needed ‘kick in the pants’ to get long-planned initiatives that are ‘still in the development stage’ out into the industry. I believe that competition is good and even welcomed in the audience measurement space today. It encourages evolution, fresh thinking and experimentation in an industry that is undergoing massive transformation with new challenges (and opportunities) to capture media usage behavior.

The Players

Serge Matta, CEO comScore and Bill Livek, CEO Rentrak released a joint statement in a press release saying, “The time has come to build this measurement system of the present and future, and that’s what the merger of comScore and Rentrak will allow us to do.” At the Rentrak Investors Day meeting this past Thursday, October 01, 2015 Livek announced that the joint efforts of comScore and Rentrak “brings two companies together with complementary assets – products, data, people and innovation. This helps us define the future of measurement.”

Upon the news, Nielsen released an official statement to all media outlets which said, "Nielsen has the only Total Audience measurement, comparable across all screens. All of our data is fully representative of the U.S. population, and we deliver truly independent measurement. There are myriad analytics options for the media industry, but Nielsen’s focus is on delivering the actual currency ratings data used for trading billions of dollars in advertising. This requires superior quality, industrial-strength delivery, and gold-standard audited processes and methods."

Industry Reactions

The reactions from the industry to the acquisition ran the gamut from elated to resigned. Some who did not want to be quoted for attribution felt that “despite the perceived benefit to the industry of an emerging Nielsen competitor and possible currency expansion to include consumer demos, from a methodological soundness perspective, it's a pretty unholy alliance.” 

But there were many who saw the acquisition as the opportunity for healthy competition and continued industry innovation. Here are a few quotes spanning networks, agencies, measurement companies and organizations:

Geri Wang, President ABC Sales said: “We support all industry initiatives that get us closer to a true cross-platform measurement solution. Increased resources and healthy competition are always positive things and the expertise of these two firms has great potential. We look forward to continuing and growing our relationship with this new enterprise." 

Alan Wurtzel, President of Research and Media Development for NBC Universal said, "Competition in the measurement space offers the opportunity to foster greater innovation among all the players. The introduction of a new measurement service which would offer a different way to crack the cross-platform code would be enormously beneficial to the entire media industry. It can't come too soon."

Colleen Fahey Rush, EVP, Chief Research Officer, Viacom said, "This merger paves the way for innovation in cross platform measurement to capture how audiences are consuming content on every screen and platform."

Howard Shimmel Chief Research Officer, Turner Broadcasting System, Inc said, “We are excited about the announcement and believe that competition is great and sorely needed. In the past, we have been vocal in our belief that there isn’t any one company that solves all of this. Like many in the industry with diverse portfolios, we need two different cross platform measurements – for a network like CNN, we need to accurately measure total reach across all platforms, including TV, Digital and Mobile. comScore offers that now and our hope is that the product gets better with the Rentrak data. But we still need the ability to see individual shows like “The Last Ship” on TNT and how they perform in live, DVR, C3, VOD, SVOD, which seems to be the focus of the Nielsen Total Audience initiative. Each product has a strength applicable to our business and it may be that we use both services for our insights and sales needs.” 

Dave Morgan, CEO and founder of Simulmedia said, “The comScore/Rentrak merger is certainly good for both of those companies. They gain scale and have a product set that complements each other well. The combined company will get more attention and grow faster than they could have on their own. It’s also good for Nielsen. The merged companies bring more attention into the marketing data and media measurement space and Nielsen will now get credit for the work that they've been doing in cross-platform that the market hasn't noticed. Plus, having a noisier comScore/Rentrak around will give Nielsen more firepower to push back on legacy media clients who may have slowed down some of their attempts to drive more innovation in the past.

Andy Brown, CEO and Chairman, Kantar Media said, “Separately both comScore and Rentrak are good partners in the US and globally. I think the merger of the two companies will only accelerate our current initiatives”  

Brad Adgate, SVP, Research Horizon Media “I think this will be the biggest challenge to Nielsen since AGB rolled out their People Meter sample nearly 30 years ago.” 

Jane Clarke, CEO, Managing Director of the Coalition for Innovative Media Measurement (CIMM) said, “CIMM congratulates comScore and Rentrak on their announced merger which will help bring needed competition into the field of cross-platform audience measurement. This area is undergoing significant pressure to innovate in response to quickly evolving consumer content consumption habits.  The proliferation of available measurement options will help innovation.  But at the same time, we cannot have a fractured approach to measurement.  While the technology that companies such as the combined comScore and Rentrak will bring to cross-platform measurement are greatly needed, it is still the cooperation and coordination of our industry that will enable effective measurement systems to be adopted.  CIMM, as the industry’s R&D body to advance cross platform measurement, was created to help foster that communication and cooperation so collectively we can address the needs and challenges that await the industry through a unified approach.”

George Ivie, CEO and Executive Director at Media Rating Council said, “I congratulate both organizations and wish them well. My hope is that comScore/Rentrak will continue to pursue accreditation of their existing products which remain very important, and that they will submit whatever cross-platform products they develop to the MRC process timely.  Project Blueprint (comScore’s initial cross platform measurement project) for example was not submitted to MRC, and there is a clear need to audit/accredit these types of new methods. Notably, the new combined entity clearly has a "big data" heritage but I caution about generalizing all of their data assets as "census."  Some sources are census, such as tag-based impression records (these require other actions such as IVT filtration), but others are not census and require specialized adjustments.”

Gayle Fuguitt, CEO & President ARF said: “We at the ARF issued a measurement mandate over a year ago, challenging the industry to deliver common GRP and ROI Metrics.  A valuable advancement is to see industry leaders like Comscore and Rentrak merge to connect their measurement onto one data management platform instead of relying on advertisers to stitch it together. We know that the fastest growing media are the least well measured today, especially mobile.  Further advancements are needed now in mobile measurement and measurement precision across the board for true GRP and ROI metrics for speed to decisions.”

Conclusion

I think that as an industry we should welcome this new paradigm of Nielsen as established measurement of television now getting into digital and a cross platform service versus comScore/Rentrak as established measurement of digital with TV measurement capabilities via STBs and a cross platform service. May the best solution become the standard!

This article first appeared in www.MediaBizBloggers.com

TV is Not Dead But It Is Evolving. A Look at On Demand

In this increasingly complex media world, on demand is emerging as the connector of viewing experiences that appear to be keeping television relevant and robust. That is according to the recent B&C Multichannel Summit which looked at the state of the television industry through the lens of on demand. Panels of content providers, data / measurement companies, advertisers and programmers offered their perspectives on how to best adapt to changing consumer behaviors.

Fighting market change is futile; The consumer is in charge and it is up to the industry to evolve. As Louis Hillelson, VP/Group Publisher Broadcasting and Cable/ Multichannel News noted, "Accessing on demand, anywhere, on any device is what the consumer demands."

TV is Not Dying ... But C3 Is

Rentrak CEO Bill Livek showed data that demonstrated that TV viewing was not declining. According to Livek, there are currently 57 million homes that are on demand enabled. The average household now spends 9.3 hours watching television with the time spent viewing primetime programming on demand doubling in the past five years. And that is because 100% of broadcast content is now available on demand. So in sum, "TV viewership is largely unchanged" he said, "Everyone is talking about the death of TV and the birth of digital but that is not so." 

But what is happening, according to Livek, is the erosion of Live TV viewing. He continued, "Fewer are watching live TV. They are using DVR and on demand platform and are segmented by time." In fact, "The majority of prime VOD viewing happens after 3 days of air."

This impacts the TV selling model which sells off C3 ratings. Further, when you view the Rentrak data through the prism of playback, it shows that certain programs are generally viewed at different playback intervals. Advertisers might benefit from placing ads in programs according to playback behavior which is something that Livek calls, "Time as a demographic."

The Business Model is Changing

For major content creators such as Ron Sanders, President Warner Brothers, Worldwide Home Entertainment Distribution, a “digital sell through opportunity” is emerging as the fastest growing home entertainment segment. What it offers is an early window to feature films in the home. Sanders said that “It is a way to keep consumers inside your cable system and keep them from ordering Netflix and Amazon.” He explained, “Once you buy it, you can download it or stream it to any device. And you can experience enhancements with a dynamically updated content structure. Now through digital we can add additional content over time such as interviews or extra directors content for example. It is a new digital service that expands the relationship with content that we've never had before. You can even copy and send your friends your favorite scenes.”

For Laura Fortner, EVP Marketing and Business Development, Whistle Sports, combining proven stars with emerging YouTube celebrities can not only be enjoyable for audiences, it can also produce unexpected fans. She explained, “We are learning how to combine the power of YouTube stars with other represented athletes. We tried an unexpected combination of talent in bowling trick shots with an amateur from Australia sharing his expertise with a professional bowler. The audience loved it and we had 21 million views. Millennials loved it even though bowling is an older sport.”

Embrace Technology or Die

Whether it is IP STBs or an initiative to expand TV everywhere, many companies are adapting to the changing technology and using it to improve the customer experience and satisfaction. Embracing technology is proving to be a very profitable way to sustain and enhance your business. The failure to embrace technology may prove to be your downfall.

Kevin Conroy, Chief Strategy & Data Officer and President, Enterprise Development at Univision, summed it up, “Choice always wins. The industry has not always offered the greatest choice or flexibility. It is all about choice and convenience. Brands that get it, that accept the new features of new technology and embrace the attributes of that new technology are in a position to win. It is never too late to get ahead of the curve. If you have audience and a value proposition and a willingness to innovate and push and are not be afraid to fail, take advantage of and continue to fuel the same level of innovation that made you great to begin with.”

Q&A Interview With Bill Livek, CEO Rentrak

Data and consumer segmentation has become pivotal in the current media landscape and there are several companies who are well positioned to offer insightful information on viewer behavior. Rentrak, with its deep database of VOD, movie and set top box activity is one of these companies. Charlene Weisler interviews Bill Livek, CEO of Rentrak. Bill discusses his background, Rentrak’s business model, segmentation, changes in the industry and some predictions for the next five years.

The five separate videos in this interview are:

Title                                              (Length in Minutes)
Background                                     (1:39)
Rentrak, Privacy and Standards     (4:16)
Measurement and Segmentation    (4:11)
Changes in the Industry                  (5:27)
Innovations and Predictions           (4:59)




Bill Livek, CEO Rentrak discusses his background, career philosophy and work experience.

CW: One of the big discussions about research in set top box data, consumer usage behavior today is the issue of privacy. How is Rentrak addressing that?

BL: We take privacy very seriously. The future is phenomenal for the American consumer because in America brand owners can produce and distribute products very effectively and very efficiently because they create mass markets (this means the consumer gets great value because efficient advertising actually lowers the product cost). Advertising and relationships with consumers are very important. That whole relationship gets destroyed if you violate the bond of privacy between a consumer and companies like ourselves. Therefore all of the systems we utilize merging databases, we’re doing in a privacy compliant way with complete respect for the American consumer.

Bill Livek, CEO Rentrak discusses Rentrak, the issue of privacy in monitoring comsumer behavior and measurement standards.



Bill Livek, CEO Rentrak discusses measurement, segmentation and the multi screen impact on research.

CW: Can we talk about standards in measurement? We have several companies working with set top box data and we have a company like Nielsen that has the standard of the industry in terms of rating, VPVH and share. How can we best develop standards that can be accepted on a platform basis, for example in the measurement of set top box data?

BL: In my opinion, standards don’t get developed within committees. Standards get developed through billions and billions of iteration of trial and error and then over time understanding what should be done as a best practice. As an example: the data that a  digital set top devices can distribute are very different depending on when they were built, by what company and the retrieval systems that companies  that own the set top devices have. Rentrak has been doing this for years now and we have processed on a daily basis more information than American Express processes with their transactions. So literally billions of transactions where a dynamic set of editing and processing rules have had to be developed. Those have been developed by Rentrak and they continue to evolve. It is my view that Rentrak has a responsibility, being the leader in the business, to share  with our customers and with the industry in a process through an industry group like the MRC (Media Research Council). Rentrak has a commitment to be completely transparent.

 

Bill Livek, CEO Rentrak discusses the most dramatic changes in the media industry over the past five years and the impact of the current economic environment on businesses and spending.

CW: Can you give me three predictions for the next five years?

BL: Wow. My crystal ball is usually broken but I will give it a shot. Databases will become essential in our business. Day to day advertising decisions will be reliant on databases. Second prediction – research will find its role in a different spot in conjunction with databases. And the third prediction is that as we come out of this great recession and the brand owners increase their profitability, the media companies that are providing content across all traditional and digital platforms will do extraordinarily well, in part because they will use systems like what Rentrak is providing today to communicate with advertisers. 

Bill Livek, CEO Rentrak discusses innovations in the industry, big screen television and the evolution of television.