Nielsen Reports Declines in Fault Rates

Nielsen Reports Declines in Fault Rates

Results Show Fault Rates Lower in Local People Meters than in Set Meters

NEW YORK, June 16 /PRNewswire/ -- Nielsen Media Research today reported that fault rates, the percentage of sample homes that do not report complete television ratings information on any given day, have declined markedly from November to May in all four markets where Local People Meters (LPMs) were introduced in 2004.

Nielsen said continued improvements in fault rates would be difficult over the next several months because they usually increases during the summer, when children are home from school, viewing patterns are different, power outages are more common, and families go on vacation or otherwise spend time away from home and Nielsen has difficulty gaining access to sample homes.

LPMs are an advanced system of electronic meters that electronically and continuously record demographic viewing in sample homes. Nielsen is introducing them in the top ten markets, replacing the previous system of paper diaries and set-top meters.

Fault rates are one measure of sample quality. From November 2004 to May 2005, overall LPM fault rates declined in three of the four markets (see Table 1 for more detail):

New York -10.4%
Los Angeles +1.6%
Chicago -24.7%
San Francisco -22.4%

Fault rates declined among African American households in all four markets and among Latino/Hispanic households in three of the four markets. From November 2004 to May 2005, African American fault rate declines were:

New York -22.0%
Los Angeles -14.4%
Chicago -18.1%
San Francisco -22.9%

Among Latino/Hispanics, fault rate results during this same period were:

New York +1.7%
Los Angeles -14.8%
Chicago -14.3%
San Francisco -33.7%

"Faults" occur for many reasons, including the installation of new equipment (television, DVD, or VCR, etc), electrical failure, machine failure, telephone failure, out-of-sync tuning of a television, and, in a people meter, a failure to log in properly. Faulting is generally higher among larger or younger households, households with children, households that watch more television and households with more VCRs, video games and other devices. The more television activity there is in a home, the greater possibility there is for activities that cause faulting.

While fault rates are a component of a sample's quality, they are not the most important one. Other factors that are more critical to a sample's accuracy are the size of a sample, the percentage of targeted households that agree to accept a people meter, or the demographic representation of the sample. Faulting does not significantly affect the accuracy of ratings because, on a daily basis, Nielsen "weights" the contributing sample households in the demographic, thereby moving closer to the true estimate of viewing by that demographic.

Over the past few months, Nielsen has introduced several quality initiatives to reduce fault rates as part of its commitment to continuous improvement in all aspects of sample quality. These initiatives include increased field personnel, personal coaching for demographic groups with the highest fault rates, and the installation of dedicated phone lines.

Fault Rates Lower Under People Meters than Set Meters

Nielsen also announced that in all markets (including Philadelphia and Washington DC, which are about to be launched in July), fault rates are considerably better in the new LPM samples than they were in the set meter samples they are replacing (see Table 2 for more detail).

In the four most recent LPM markets, set faults were lower for all audiences in May 2005 than they were in May 2004, when the set meter was being used (these are direct comparisons and as such do not include personal faulting, such as a failure to log in correctly or fill out a diary completely, since set meter samples do not have persons faults.) The same is true in Philadelphia and Washington DC, where LPM data will become commercially available in July. In these two markets, LPM and set meter were compared for May 2005, when both systems were operational. With lower fault rates representing improvements, the magnitude of overall improvement in these markets was:

New York -31.7%
Los Angeles -17.9%
Chicago -34.5%
San Francisco -19.1%
Philadelphia -22.2%
Washington -8.0%

Among African Americans, LPM fault rates in May were lower than set meter fault rates a year ago in five of the six new LPM markets:

New York -44.1%
Los Angeles +3.7%
Chicago -12.5%
San Francisco -39.2%
Philadelphia -22.1%
Washington -0.9%

Among Latino/Hispanics, LPM fault rates in May were lower than set meter fault rates a year ago in five of the six new LPM markets:

New York -39.4%
Los Angeles -26.5%
Chicago -35.7%
San Francisco +28.3%
Philadelphia -36.0%
Washington -16.1%

About Nielsen Media

Nielsen Media Research is the world's leading provider of television audience measurement and advertising information services. In the United States, Nielsen's National People Meter service provides audience estimates for all national program sources, including broadcast networks, cable networks, Spanish language networks, and national syndicators. Local ratings estimates are produced for television stations, regional cable networks, MSOs, cable interconnects, and Spanish language stations in each of the 210 television markets in the U.S., including electronic metered service in 56 markets.

Nielsen Media Research is part of VNU Media Measurement & Information, a global leader in information services for the media and entertainment industries. The group serves the information and marketing needs of television and radio broadcasters, advertisers, agencies, media planners, music companies, publishers, motion-picture studios, distributors and exhibitors, and the Internet industry. VNU is a global information and media company with leading market positions and recognized brands in marketing information (ACNielsen), media measurement and information (Nielsen Media Research) and business information (Billboard, The Hollywood Reporter, Computing, Intermediair). VNU is active in more than 100 countries, with headquarters in Haarlem, the Netherlands and New York, USA. The company employs 38,000 people. Total revenues amounted to EUR 3.8 billion in 2004. VNU is listed on the Euronext Amsterdam stock exchange. For more information, please visit the VNU website at www.vnu.com

Table 1
Comparison of LPM Fault Rates from November 2004 to May 2005
(Sets and Persons Fault Rates)

Nov 2004 May 2005 Improvement
(LPM) (LPM)
New York
Overall 14.4 12.9 10.4%
HH5+ 23.9 19.8 17.2%
Black 21.4 16.7 22.0%
Hispanic 17.4 17.7 (1.7%)
AOH <35 16.7 16.0 4.2%

Los Angeles
Overall 12.4 12.6 (1.6%)
HH5+ 18.5 15.4 16.8%
Black 18.1 15.5 14.4%
Hispanic 16.9 14.4 14.8%
AOH <35 16.4 14.6 11.0%

Chicago
Overall 15.0 11.3 24.7%
HH5+ 23.9 20.5 14.2%
Black 21.6 17.7 18.1%
Hispanic 18.9 16.2 14.3%
AOH <35 20.2 16.1 20.3%

San Francisco
Overall 13.4 10.4 22.4%
HH5+ 26.3 17.8 32.3%
Black 18.8 14.5 22.9%
Hispanic 24.3 16.1 33.7%
AOH <35 18.1 11.1 38.7%

Table 2
Fault Rate Comparisons between Set Meter and LPM Samples
(Set Faults*)

Set Meter LPM
May 2004 May 2005 Improvement

New York
Overall 12.6 8.6 31.7%
HH5+ 21.0 14.3 31.9%
Black 22.9 12.8 44.1%
Hispanic 19.8 12.0 39.4%
AOH <35 18.4 10.4 43.5%

Los Angeles
Overall 11.2 9.2 17.9%
HH5+ 16.3 10.3 36.8%
Black 10.9 11.3 (3.7%)
Hispanic 13.6 10.0 26.5%
AOH <35 16.4 9.9 39.6%

Chicago
Overall 11.6 7.6 34.5%
HH5+ 16.2 13.4 17.3%
Black 15.2 13.3 12.5%
Hispanic 15.4 9.9 35.7%
AOH <35 14.5 11.8 18.6%

San Francisco
Overall 9.4 7.6 19.1%
HH5+ 13.5 14.0 (3.7%)
Black 14.3 8.7 39.2%
Hispanic 9.9 12.7 (28.3%)
AOH <35 14.1 8.3 41.1%

Set Meter LPM
May 2005 May 2005 Improvement
Philadelphia
Overall 10.8 8.4 22.2%
HH5+ 18.4 14.1 23.4%
Black 15.4 12.0 22.1%
Hispanic 20.0 12.8 36.0%
AOH <35 16.7 12.1 27.5%

Washington DC
Overall 8.8 8.1 8.0%
HH5+ 13.6 14.7 (8.1%)
Black 11.1 11.0 0.9%
Hispanic 14.3 12.0 16.1%
AOH <35 14.6 10.4 28.8%

* The appropriate comparison to the set meter sample is to use set-only
faults, since set meter samples do not have persons faults, as persons
data are collected by diaries.

Contact: Karen Gyimesi, 646-654-8358

Source: Nielsen Media Research

CONTACT: Karen Gyimesi, 646-654-8358, for Nielsen Media Research

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