MiT3: television in transition

Plenary Conversation 1:

The Future of Television

John Dimling, Nielsen Media Research
Charles Ferris, former chair, FCC
Toby Miller, NYU
Moderator: William Uricchio, MIT

An audiorecording of The Future of Television is now available.

SUMMARY

JOHN DIMLING divided the history of audience measurement into three periods. In the first phase, from the inception of television in the late 1940s through the mid 1970s, the era of the three dominant networks was the time of the captive audience. The second phase, the cable era, lasting until 2000, offered many choices for audiences. The last phase, in its embryonic stages in the early years of the 21st century, is an era in which the audience itself will exercise control over television viewing.Dimling discussed each period in terms of its infrastructure, programming and viewer response.

In the first era, television mostly consisted of the "Big Three" networks. Until the early 1970s the typical household could receive an average of seven signals. The average rating for a network was 18.8, meaning it was watched by 18.8% of TV households. An average household tuned in about 6 hours a day. Nielsen obtained data in these ways: a panel of 1,200 households used meters, while 2,400 other households kept tri-weekly diaries.

During the second period, cable networks emerged and began to produce original programming. In 1980, cable penetration was 20%; by 2000 it was 80%. In 1980, a household received an average of 10 signals; today it receives about 102. Although viewers watched more television than ever before, the audience for network programming decreased as the number of cable channels enlarged.

These developments forced Nielsen to increase the size of its sample and change its methods of data collection. The standard method became the use of the "people meter," rather than the diaries. The meter required simply the push of a button to monitor what viewer choices; respondents did not have to identify the source of programming.

Meanwhile, in response to the increasing popularity of Univision and Telemundo, Nielsen introduced a separate system for measuring Hispanic audiences.

Today, the infrastructure is becoming digital. Dimling expects that audiences for networks will continue to decline, while those for cable will increase. The biggest change will be in the degree of control people have over what they watch. Personal Video Recorders such as TiVo allow viewers total freedom from the time schedules of the networks and also permit them to eliminate commercials. In the future, PVR capabilities that are built into set top cable boxes may enable targeted commercials. It is uncertain how fast these changes will occur, but Dimling does not believe these devices will cause the death of the 30-second commercial. Many people fast-forward through commercials, but they will still be around, though decreasing in effectiveness.

Nor will the Internet destroy TV viewing. Streaming video on the Internet is used mainly for information, not entertainment. For example, visits to news sites increased dramatically during the current war in Iraq.

Nielsen is developing new techniques. They have a new meter that can measure multicasting. They are also working with TiVo to put data collection software in the PVR devices.

Discussion

WILLIAM URRICHIO: People move around between programs a lot. Does the meter account for that?

DIMLING: The current meter measures every 3 seconds, which means we don't record every single flip, but we can record what station you are tuned into at every interval.

URRICHIO: Do program makers use this information?

DIMLING: Yes they do; and we think that will increase in popularity. We have always offered a minute-by-minute analysis. Nielsen data increases efficiency in two markets: viewer time traded for entertainment, and producers trading viewer time for dollars. For example, data shows whether TV advertising works. Both markets use the data to operate more efficiently.

QUESTION: Has your client base changed over time?

DIMLING: It's certainly expanded over the 50 years. Networks and ad agencies are traditionally clients. Now cable networks, syndicates, and cable systems are clients as well. Essentially, anyone operating a business in the television industry has use for our data.

QUESTION: Has Nielsen tried to develop new kinds of data?

DIMLING: "No," in the sense that we always measure who is watching TV, but "Yes," in the sense that we offer new ways to look at the data, as well as other demographic information.

QUESTION: How representative is the sample that you take of the total viewing population? Is it skewed toward viewers that advertisers would be more interested in?

DIMLING: This is an important issue that we spend a lot of time and money on. Our sample is quite representative. Our response rate is over 60%, which is high for commercial research. There are various parts of the population that are harder to recruit, but we take extra efforts to recruit them. But we are not skewed. For example, advertisers are generally less interested in people 55 and older, yet we have a representative number of that group, so it's a very good national sample.

QUESTION: Your database has incredible historical value. Is it archived and publicly accessible? Do you collect qualitative data as well, such as through focus groups?

DIMLING: Nielsen has archived most of the basic data. The first 30-35 years are mostly hard copy and is more difficult to access. The later stuff is saved electronically. We will continue our new system that gives people direct access to the database.

We don't have much qualitative data in terms of program preferences, but we get some information about purchase behavior. We have done studies of people after they left the sample, as part of special analysis for special clients, but it's not usually published. We are reluctant to do anything with a household in the current sample that may discourage their participation.

CHARLES FERRIS began with an anecdote. When he first became chairman of the FCC in 1977, the CEO of Warner Cable Gus Hauser demonstrated an interactive cable system that could scan TV sets every 15 seconds to determine what people were watching - and this scared him. Ferris fears there is an increasing loss of privacy today.

Ferris is reluctant to make predictions about the future of television or any medium because some regulators make decisions in order to make their predictions come true, which is dangerous. The real challenge of a regulator is to remain intellectually uncommitted, and to recognize that the technology will drive changes.

Ferris offered a brief historical account of media regulation in the U.S. The regulatory regime established in the 1920s and in the era of radio remained essentially in force until the 1980s. In the beginning, federal regulation was born of necessity. Radio, and later television, was an effective and inexpensive means of mass communication. Before the late 1920s, broadcasting was not regulated. Private entities rushed to fill the airwaves, and Secretary of Commerce Herbert Hoover did not have the power to limit the number of licenses, nor did he want to. He was pro-business and believed the broadcast spectrum should not be controlled by a select few.

By 1927 there was chaos. There were over 700 broadcast stations. Though this is a small number compared to today's 13,500 stations, they were packed into two frequencies and concentrated in the East Coast. People felt federal regulation was the only solution.

The Radio Act of 1927 created the Federal Radio Commission, ancestor of the FCC, and established federal control of broadcasting. Its enabling principle -- to serve the "public convenience, interest, or necessity" -- established the notion that broadcasting should serve a public or civic interest. The principle that the broadcast spectrum belongs to the public was the essence of the regulations to follow. However, as technology provided more TV and radio stations, many believed that market competition would preserve public interest. Thus began a new era of deregulation.

One of the last FCC actions during Ferris's tenure was removal of regulations on radio. One such regulation was a limit of 17 minutes per hour for advertisements. The result, Ferris said, has been a damaging increase in commercials. Ferris believes that broadcasters are not simply economic entities; they are public trustees, and as such they have social responsibilities. Excessive deregulation will be harmful to democracy.

Ferris does not believe that the broadcast world is doomed. There might be a second "Big Bang" of media channels that will be associated with the Internet, and there won't be any gatekeepers. In general, he believes that things will sort out because viewers have a lot of common sense. However, determining the reliability of information will be the real problem.

Discussion

QUESTION: Last week, the CEO of a large broadcasting group lobbied to eliminate the limitations on a group's holdings in a media market. He says that conglomerates are dominant now and small independent stations have no chance of survival. What's your take on that?

FERRIS: Clear Channel is an example: They have about 1,100 radio stations out of 13,000. Meanwhile, the FCC decided in June to lift the consolidation requirements for TV. The mistake is to believe that all decisions are merely economic or financial. Broadcasting must have a public or civic aspect. It's about who's actually going to program the minds of the American people. Around 22% of people get their information from talk radio, but it's largely dominated by a single political viewpoint.

QUESTION: What do you think about the current set of proposed deregulations regarding cross-media conglomeration? What should happen?

FERRIS: It's inevitable that such barriers will come down. My successor Mark Fowler was the first agenda-driven FCC chair. He was open about his anti-regulation bias. That really affected how the FCC worked. Fowler's knowledge in advance of what he was planning got the Congress interested in telecom policy. Now, the FCC and Congress interact too much, as far as I'm concerned.

IAN CONDRY: What lessons do you draw from peer-to-peer music sharing? Will that kind of chaos in file sharing and threat to intellectual property come to TV? Is there something in the regulatory history, VCRs for example, which can offer a lesson for the current climate?

FERRIS: At the birth of the VCR, I used to debate with Jack Valenti, who represented the Motion Picture Association. I argued that the VCR would be Hollywood's best friend, and I was right. Video releases are pushing number one. Most of those issues were based on copyright laws. The philosophy behind copyright law is the notion that a creator should be rewarded for his creativity. The only reason why the government gives long copyrights is to encourage wide dissemination and let ideas be open to the public. Copyright will always be a contentious issue. I cannot predict what the resolution will be.

TOBY MILLER began with two famous statements by past FCC Chairs. The first is by Newton Minnow, who called U.S. broadcast TV of the 1960's "a vast wasteland." Miller believes that this was part of the Cold War rhetoric of the time, and a reminder to the big three networks of their public responsibility.

The other quote is by Mark Fowler, also a chairman of the FCC, who called television "a toaster with pictures." This statement made in the 1980's implied that TV was empty, because it was dominated by Hollywood stories designed to appeal to an array of white ethnic cultures. This reflects the emptiness that a liberal culture can produce, Miller asserted.

He suggested that if television was a wasteland in the 60's and a toaster in the 80's, then today U.S. television is three things: a bank, a couch, and a landfill.

U.S. television is a bank. If you turn to news today, the tendency is to engage in "financialization," or to value in monetary terms of all kinds of activities. This was seen after September 11th in how there was a great deal of time devoted to discussing the economic impact of terrorism. Today, basic economic knowledge is required for all current affairs reporters. On channels such as CNBC and MSNBC, the value of public activities is understood in fiscal terms. Cultural perspectives are subordinated to the monetary.

Television has also become a couch, an environment for the emotionalization of discourse. There is an increasing domestic emphasis in mainstream news. This is part of a wider tendency to ask people how they feel about things. For example, in interviews with NBA players, you might learn that they felt God was with them during a game, but you won't learn anything about tactics or actual performance. This trivialization of mainstream coverage is problematic.

Finally, television has become a landfill. By this metaphor, Miller wishes to call attention to the way in which the physical object of the TV set is made and used: where and how it is manufactured, where it travels, and what happens to it in its afterlife as a cast-off relic, part of a landfill.

Most TVs are made by women under dangerous conditions in Third World countries such as China. After the finished products are consumed by the First World, it is illegal to dump them in most U.S. landfills because they contain dangerous substances. So they go back to China where this time, children of six or eight take the machines apart without wearing any protection; the dangerous, unwanted parts are dumped into a Chinese landfill. This is something almost no one in media studies has paid attention to, because most people concern themselves with the female subjectivities of viewers and consumers, rather than those who are making and disposing our TVs. In talking about the future of television, it is crucial to see it as an environmental entity, not just as programming or technology.

Discussion

QUESTION: We seem to be going toward "fantasy television," where there is no representation of "the other." The representation of the recent war in Iraq seems a lot like a video game, where everything has been created within a specific set. Is there any reality left?

MILLER: The problem with U.S. coverage wasn't so much about simulation, but the myth of objectivity by embedded reporters, when in fact journalists got solely one side of the story. With deregulation and the collapse of a unified audience, and because news and current events had never really made money for networks, foreign news bureaus were closed everywhere. In 2000, only the stories of the second Intifada and Elian Gonzalez were really covered with any seriousness in terms of international issues, but both are, in a sense, domestic issues.

QUESTION: Have you done studies of Latino TV representation? Is more multicultural presence possible?

MILLER: I studied the distribution of Mexican films in the U.S. I found it hard to measure the audience because unlike any other ethnic group, Spanish-speaking immigrants are constantly regenerated with new migrants. The obvious obstacle I found to Mexican cinema was racism among media makers. However, some better things may arise from Miami, which is commercially driven to be the new core of capital linked to media and the Latin community.

COMMENT: I want to add to the issue of TV as a landfill: It's apparent that there will be an environmental crisis around the world. There's a deadline set for the full transition from analog to digital TV, which is currently 2006. Digital TVs will make hundreds of millions of analog TVs obsolete and dumped.

DIMLING: That is a very potent observation. However, I doubt we will be all digital by 2006, despite contemporary enthusiasm. But it is a huge problem.

QUESTION: Are there new advertising models that can support higher quality, diverse news?

MILLER: I hope so. The big money is from national advertisers.

DIMLING: There is a study done by Peter Steiner, which said the more channels you have, the more diversity you have. In general, I think the concept is valid. I don't know the numbers, but I do believe that as technology allows more programs to be presented, the probability of having what you're seeking increases.

FERRIS: I must say that's counterintuitive to me. When CNN came out, I thought that it was an extraordinary distributor of news, akin to the AP wire - no editorializing, just the straight news. But as "diversity" increased, you get a cloning phenomenon: CNN has degraded tremendously since the advent of MSNBC and others. Like talk radio, they're in the business of pandering the worse instincts of people - emotionalism not based upon fact, but opinion. The big problem came with the merger of news and entertainment. Dan Rather tells you on 60 Minutes what's going to be on Monday night's news! How does he do that?

DIMLING: I think we're talking about a couple of different things; all of us may share a common view of talk radio, but it does represent a voice that wasn't in the media before, like it or not.

QUESTION: For John Dimling, how is Nielsen preparing for new changes coming to TV such as video-on-demand? How does the unit of media share change when you have an infinitely growing amount of media to be watched?

DIMLING: It's not easy, but we'll be able to stay on top of what people are watching. If you're accessing an episode from a year ago, if we have a code in that program, we can still pick up on that. How we report it is something we're starting to talk about with advertisers and clients. For example, if Coca-Cola's running a summer promotion, your winter viewing probably isn't worth very much.

COMMENT: This is more of an observation than a question. Regardless of how we measure what people are watching, we should get back to political and economic equation of who produces shows, for whom, and within what movements. We should also compare dominant and alternate programming. And we should think about how you can't always capture certain subcultural activity.

--compiled by Lilly Kam
--photos by Nicole Burkart and Lilly Kam

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