Executives at Paramount Global have warned employees and some media agencies that the entertainment company might drop its reliance on Nielsen data on October 1.
The date coincides with the expiration of a contract between Paramount and Nielsen that involves the latter providing measurement data used by employees of Paramount’s advertising business to set prices for ad inventory on its CBS broadcast network, co-owned cable channels and streaming platforms Paramount Plus and Pluto TV.
Paramount is already looking at alternative currencies, and intends to use VideoAmp for measurement data if it cannot strike a new deal with Nielsen by October, according to trade publication Variety, which first reported on the situation on Thursday.
“Disengaging from Nielsen is not our first choice, and we remain hopeful for a resolution,” John Halley, the President of Paramount’s advertising business unit, wrote in a letter sent to some media agencies this week.
The letter went on to complain that Nielsen “is insisting on substantial price increases across all their products, including linear measurement, despite the changing economic landscape of our industry.”
“Nielsen’s costs as a percentage of Paramount ad revenue have quintupled over significant parts of our business over the last years; in certain instances, Nielsen’s fees already exceed the total advertising revenue of the network being measured,” Halley wrote. “This has led us to conclude that the model, as proposed, is not workable, and that the cost structure requires re-engineering.”
Nielsen is one of the leading measurement firms in the world, supplying viewership data of traditional broadcast and cable TV channels in the form of ratings reports for decades. Its reports have come under fire in recent years as some broadcasters complain that Nielsen’s ratings data doesn’t fully account for other forms of TV, including streaming video services. Earlier this year, Nexstar Media announced it was partnering with Comscore for currency-grade measurement data for its 200 owned or operated TV stations.
Paramount may have another reason for wanting to part ways with Nielsen: The company is looking to cut costs ahead of its impending merger with Skydance Media. Executives are targeting around $500 million in cost savings through restructuring and eliminations, they said
