 "Two TV rating systems difficult to manage: Prashant Singh")
The saga around TAM ended last month with the formation of a joint venture with Broadcast Audience Research Council (BARC). TAM is owned jointly (50:50) by the $6.3-billion US-based Nielsen Holdings and the £11.52-billion UK-based marketing services group WPP. Vanita Kohli-Khandekar spoke to Prashant Singh, managing director, Nielsen India, on what the venture means for TAM's business in India. Edited excerpts:
What is the joint venture about and what was the reason behind entering it?
For Nielsen and other stakeholders, it was obvious that two currencies (for television ratings) are not sustainable as it causes confusion in the industry, especially if the numbers differ for the same spot.
The BARC and TAM will form a company to manage the combined meters these two firms have in 32,000-odd Indian homes. For now, the working title is The Meter Company.
But wasn't there talk of a buy-out of TAM?
A substantial amount of TAM's business (top line) comes from its non-TV services - S Group Consulting, Eikona PR, Adex and so on. The Meter Company as a JV focuses only on the TV business and this helps both remain sustainable.
What is the JV's structure?
The Meter Company (as it is called for now) will be co-owned by BARC and TAM. The legalities on name etc have to be decided. This company will take all of BARC's and TAM households with meters and manage the panel. BARC will give the design. The Meter Company will give BARC raw data, which then BARC will put through its software system.
Aren't the meters totally different, how will that be reconciled?
Any meter technology captures what is being watched and who's watching that in which household. The way BARC works is, it designs the methodology and then a third-party does the work. In this case, the meters are with BARC and Hansa does the panel management. These 32,000-34,000 panels could be managed by The Meter Company. Therefore, operationally there is no difference. The challenge is how soon this can be done. We may need to redeploy many meters, change households.
What is Nielsen's role in this joint venture?
Nielsen provides the backbone of the technology that TAM uses. There have been many articles suggesting that Nielsen's technology is archaic, that people have to go to the households to collect data. That is incorrect. All the households' data is collected remotely and deposited into a server. The two platforms will continue to exist up to the data collection point. If TAM's shareholding in The Meter Company is X per cent, X/2 will be held by Nielsen. The Meter Company is a subsidiary of BARC and TAM and a vendor to BARC.
How long will it take to become operational?
Currently, it is just an agreement. It will take a few months to set up a new firm. So, it will take some time before The Meter Company is operational.
Has such a structure been tried in any other market?
No, wherever we have a joint venture it is with Kantar or a Kantar company, never a three-way JV with the joint industry body (in this case BARC) in the mix.
What is the joint venture about and what was the reason behind entering it?
For Nielsen and other stakeholders, it was obvious that two currencies (for television ratings) are not sustainable as it causes confusion in the industry, especially if the numbers differ for the same spot.
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Two TV measurement systems in any country are difficult to manage and there are only a handful of countries with two systems. Given that, we had to come together for several reasons. First was to ensure there is one standard and it is the unequivocal currency. Second was to expand the panel size faster. Third, BARC gets to use the experience of the team at TAM. We are all part of the same industry; the whole idea was to figure out a way to pool our resources.
The BARC and TAM will form a company to manage the combined meters these two firms have in 32,000-odd Indian homes. For now, the working title is The Meter Company.
But wasn't there talk of a buy-out of TAM?
A substantial amount of TAM's business (top line) comes from its non-TV services - S Group Consulting, Eikona PR, Adex and so on. The Meter Company as a JV focuses only on the TV business and this helps both remain sustainable.
What is the JV's structure?
The Meter Company (as it is called for now) will be co-owned by BARC and TAM. The legalities on name etc have to be decided. This company will take all of BARC's and TAM households with meters and manage the panel. BARC will give the design. The Meter Company will give BARC raw data, which then BARC will put through its software system.
Aren't the meters totally different, how will that be reconciled?
Any meter technology captures what is being watched and who's watching that in which household. The way BARC works is, it designs the methodology and then a third-party does the work. In this case, the meters are with BARC and Hansa does the panel management. These 32,000-34,000 panels could be managed by The Meter Company. Therefore, operationally there is no difference. The challenge is how soon this can be done. We may need to redeploy many meters, change households.
What is Nielsen's role in this joint venture?
Nielsen provides the backbone of the technology that TAM uses. There have been many articles suggesting that Nielsen's technology is archaic, that people have to go to the households to collect data. That is incorrect. All the households' data is collected remotely and deposited into a server. The two platforms will continue to exist up to the data collection point. If TAM's shareholding in The Meter Company is X per cent, X/2 will be held by Nielsen. The Meter Company is a subsidiary of BARC and TAM and a vendor to BARC.
How long will it take to become operational?
Currently, it is just an agreement. It will take a few months to set up a new firm. So, it will take some time before The Meter Company is operational.
Has such a structure been tried in any other market?
No, wherever we have a joint venture it is with Kantar or a Kantar company, never a three-way JV with the joint industry body (in this case BARC) in the mix.