Why Nielsen Is Now Measuring Amazon and What That Means for New Streaming Services

As streaming competition heats up, so will the servers at Nielsen’s data collection facilities in Florida

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Like all of us employed by the industry in the “Peak TV” era, Nielsen is working harder than ever.

On Monday, the ratings currency company announced that it is now measuring viewership for Amazon Prime Video shows and unveiled the viewership numbers it crunched for new series “The Boys.” The Amazon addition comes two years after Nielsen first said it was doing the same tabulations for Netflix shows, news that wasn’t well-received by the streaming behemoth, a company that was famously even more secretive about its viewership data back then.

What’s the beef? Both streaming services believe Nielsen numbers severely underrate their shows. After all, Nielsen is only measuring television sets, so mobile, computer and tablet viewing all aren’t counted. That’s true for any platform Nielsen measures, but Amazon, for one, believes the strategy disproportionately punishes the modern way many subscribers choose to consume its programming. Also, both Amazon and Netflix are international companies, and Nielsen only measure U.S. audiences. It’s a piece of a pie, but not a piece of cake to reconcile with a platform’s own findings.

As a result, Nielsen also doesn’t report nearly the same ratings as Netflix does, and their methodologies for measuring a “view” are very different. Guess which version produces way more impressive numbers for Netflix shows? Yup, you guessed it.

One recent example of the chasm between their approaches can be seen in the performance of Netflix’s “El Camino: A Breaking Bad Movie.” Nielsen reported that over its opening weekend, the “Breaking Bad” sequel film attracted 6.5 million viewers on Netflix. Nearly a week later, Netflix reported that within its first week on the platform, “El Camino” was watched in 25.7 million households.

Yes, those are different ways of looking at it, but in no way are the outputs compatible with one another.

And it’s not about to get any less complicated.

As the streaming wars heat up, so will the servers at Nielsen’s data collection facilities in Florida. The digital landscape is about to get even more crowded with upcoming rollouts of new pay-streaming services like Disney+, HBO Max, Peacock and Apple TV+. Peacock will have both an ad-supported option and a subscription option. About a year after launch HBO Max is expected to add an ad-supported option in addition to its subscription option. Apple TV+ and Disney+ will be sans commercials.

Though Netflix is now singing a slightly different tune when it comes to occasionally sharing its own data, the company is still not down with Nielsen, literally. Netflix is not a Nielsen client, though the other subject of this story, Amazon, is.

On Wednesday, when Netflix Chief Content Officer Ted Sarandos was interviewed by Katie Couric at Vanity Fair’s New Establishment Summit, one of the topics was his apparent about-face on sharing viewership statistics — Netflix’s viewership statistics.

“For a long time, I was opposed to doing it because…I think the ‘ratings wars’ were negative on creative,” he said. “Everyone’s focused on opening weekend or the premiere episode viewing. [That] forced entertainment companies to be careful and not want to bet long on people and try new things. So, I thought the longer we stayed out of the fight, the better.”

Sarandos told Couric that traditional Nielsen data, which emphasizes live viewing or (generally) up to one week of delayed DVR catchup, just didn’t make sense for his company. He argued that Netflix subscribers know their content will remain available for a long period of time, which chips away at a sense of urgency still emphasized by ad-supported platforms and rewarded by Nielsen’s system.

But then Sarandos said he had a revelation.

“By not [touting viewership statistics], I think people were missing cultural moments,” he said. “One way that people choose things is popularity, and we were denying people the use of that one tool to help them discover new things.”

“We’ll be more and more transparent with those numbers,” Sarandos promised.

It’s no secret that Netflix has really only released to media its particularly impressive numbers from particularly popular series and movies, something referred to internally there as a way of “celebrating a win.” Creators still see many more Netflix viewership statistics than the press or the general public does, Sarandos and his team says.

Amazon doesn’t share “absolute numbers” with its showrunners, Albert Cheng, the company’s co-head of TV, told TheWrap this summer.

“We do have ways in which they understand how their shows are performing,” Cheng said at the time. “We usually do that after the season has premiered. “We get together with them around the table and we walk them through how it has performed.”

That doesn’t mean a studio ultimately gets intel on how the shows it produces are performing on Amazon. On Friday, one studio told TheWrap that Amazon does not provide them with viewership data.

And you can forget about it for us lowly reporters.

“We talk about this all the time,” Cheng’s boss, Jen Salke, told us during the same summer conversation. “I came from the network business…where you’re used to being able to go out and talk about success in viewership numbers. Our company doesn’t embrace that strategy. We agree that it’s not a strategy for us. We know what the numbers are.”

“We’ll talk about the success of our shows and sort of single out shows that are over-performing, but we’ve yet to embrace a strategy across the company where we want to get out with actual numbers,” she added.

Though those quotes are a few months old, a spokeswoman for Amazon told us on Friday, “We stand behind what was said at the time.”

Amazon, Netflix and Nielsen all declined to comment on this particular story.

There’s another reason Amazon would be particularly averse to have its Prime Video content analyzed by a third-party company that then, in turn, publishes the information either directly or through journalists. While Netflix is strictly an entertainment service that relies on the willingness of a subscriber to pay its monthly rate for content, Amazon is really an e-commerce retailer that also happens to create and purchase series and movies as a promotional tool for its 2-day shipping service.

Prime Video is an add-on to Amazon Prime, a cool perk thrown in for someone who doesn’t want to wait for their batteries, books and toys.

Like Netflix, Amazon does not have an ad-supported option. Neither has plans for one anytime soon — so why is Nielsen, which essentially provides data to help price television commercial time right, focused on those two?

Nielsen will tell you that it can measure anything thanks to its powerful and proprietary panel, which is made up of 100,000 Americans who span demographics and rotate out every two years. They’ll tell you that it takes time to calibrate this process for streaming platforms and that due to the differences in counting up streaming views vs. its traditional measurement process, tallying streaming numbers is a bit more labor intensive.

Netflix and Amazon were easy targets. They’re the biggest, the best-known, awards hogs and, between the two companies, are worth about $1 trillion. It was smart PR for a new product, Nielsen’s Subscription Video On Demand (SVOD) Content Ratings. This was data everyone — including this ratings reporter — wanted.

Plus, there was no such thing as Disney+ at the time. Here comes the wrench — and the stiff competition.

In time, Nielsen would like to measure all of the Maxes and Pluses and birds of colorful plumage. For Apple TV+, which can kind of be considered the Prime Video for the iPhone and iPad maker, Nielsen might wanna get on that whole mobile measurement thing.

Nielsen’s SVOD ratings launched in October 2017 with Netflix as its primary focus. Two years later, it’s finally expanding — and just in time for the coming explosion.

“Adding Amazon Prime Video will provide subscribing clients not only with an ability to uncover and analyze their own content streamed on this additional platform, but also to better understand the total content lifecycle of competing media offerings regardless of distribution model- from live or time-shifted viewing to video-on-demand via set-top-boxes to streaming,” Nielsen said earlier this week, adding that its SVOD “solution” provides clients with “a more comprehensive look into a larger portion of the streaming landscape, helping them to further uncover the relationship this content has in regard to other streaming platforms, as well as how content compares to the television ecosystem as a whole.”

Nielsen says its evolving SVOD product fulfills a need for studio clients that the actual streaming platform does not. Sony Pictures Television’s James Petretti echoed that as part of the Monday announcement.

“Nielsen’s measurement in the SVOD space is invaluable for our studio to understand how our programs perform on these platforms and the audiences they attract,” said Petretti, the senior vice president of U.S. research and analytics at Sony Pictures Television, which is the studio that produces “The Boys” for Amazon. “It becomes even more exciting for us, because Nielsen has the ability to help us understand what these audiences are doing outside of those platforms as well- how and what they are watching on other on-demand and linear services. We are also able to understand the impact of traditional linear advertising driving viewers to these SVOD programs so what Nielsen is providing is extraordinarily compelling.”

Tony Maglio

Tony Maglio

TV Editor • tony.maglio@thewrap.com • Twitter: @tonymaglio



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