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comScore Idea Proposal (SCOR, NLSN)

comScore Idea Proposal (SCOR, NLSN)
 

Will comScore’s cross-platform measurement technology challenge Nielsen and lead the company to revenue growth?

Report Available: May 19, 2017

 

Blueshift’s initial research found SCOR scrambling to deal with internal accounting issues that have temporarily halted trading of the company’s shares. At the same time, SCOR is facing off against NLSN and others as demand grows for measuring TV audiences across platforms and devices, where many content owners have been unhappy with the accuracy of NLSN’s rating system. SCOR’s acquisition of Rentrak – with its measurement system based on set-top box data – could put the company in position to challenge NLSN. Separately, there is an opportunity for SCOR in measuring the effectiveness of digital video advertising after several scandals surrounding the inaccuracy of FB’s internal tracking data.

 

Observations

  1. SCOR is grappling with internal turmoil. NASDAQ suspended trading of its shares in February because of the audience-tracking company’s continued inability to file required financial disclosures. SCOR has been re-working three years of financial statements after discovering last year that it had overstated 2015 revenue and understated its operating loss. In the wake of the accounting scandal, SCOR brought back its founder to run the company as CEO and is trying to file the necessary accounting statements with an aim of resuming trading on NASDAQ this summer.
  2. As SCOR tries to get its financial house in order, the company is locked in a battle with NLSN and others over the future of measuring audiences for content and advertising across different devices and platforms. SCOR said its cross-platform measurement technology, which is being rolled out for testing this spring, “will have person-level reporting across linear TV, time-shifted TV, [video-on-demand], over-the-top and digital video with advanced demographics.” Following SCOR’s 2016 acquisition of Rentrak, which tracks audiences using set-top box data from pay-TV operators, the combined company could pose the first real threat to NLSN in decades. For its part, NLSN claims its Total Audience Measurement platform is gaining traction.
  3. For years, TV networks have complained that NLSN’s panel system does not accurately measure total viewership of their content, hurting the rates they can charge advertisers. In March, Fox, Turner and Viacom – three of the biggest national media companies – announced the creation of OpenAP, a system of targeted TV advertising, as they seek audiences beyond those measured by NLSN. Data sets from both NLSN and SCOR will be part of the consortium’s effort.
  4. The battle over measuring digital audiences is a crucial one. A SCOR study released this month shows younger consumers moving heavily towards digital content and away from traditional TV. Digital ad spending in the U.S. is expected to top $82 billion in 2017, while TV ad spending is projected at $72 billion, according to eMarketer.
  5. Another key factor in the race to measure the effectiveness of digital advertising revolves around video ads on FB. After the social media platform was hit with several accusations last year that some of its ad statistics were off, the company said it had expanded its relationships with SCOR, NLSN and other data companies to improve measurement accuracy. Last month, SCOR announced that it could provide key viewability metrics for ads running on Facebook, Instagram and external publishers in the Facebook Audience Network.
  6. In Blueshift’s Jan. 6, 2016, report on NLSN, sources were mixed on whether NLSN or SCOR had the lead in digital video measurement, but most were waiting until more information was available about NLSN’s Total Audience Measurement and SCOR’s Xmedia. Four sources said developing a cross-platform measurement was the right strategy, but five were skeptical that it could be done accurately.

 

How does SCOR’s cross-platform measurement system compare to NLSN’s? Do advertisers want what SCOR is selling? Does SCOR provide better audience data for TV network-backed efforts like OpenAP? Can SCOR grow revenues in its ad measurement business? Are new competitors in the ad measurement field a threat to SCOR and NLSN? To answer these and other questions, Blueshift will gather data and issue a market research report from independent sources in the following areas: Television networks, TV advertising executives, Digital advertising executives, and Industry specialists.

  

Companies: comScore Inc. (SCOR), Facebook Inc. (FB), Alphabet Inc. (GOOG), Nielsen N.V. (NLSN)

 

Research Begins: May 1, 2017