Nielsen Recount on Dish Subs Causes Drops for Many Nets

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Many cable networks saw their Nielsen distribution numbers drop—anywhere from 200,000 to 1 million homes—when the ratings company adjusted its figures for Dish Network this year.

The fact that Nielsen had revamped its “universe estimates” for many networks—due mainly to problems tallying Dish Network’s subscriber counts for individual networks—came up during Crown Media Holdings second-quarter conference call Wednesday. Nielsen said it is still working to solve the issue and nail down a way to more accurately track cable-network distribution in direct broadcast satellite homes, where subscribers have a choice of many varied programming packages.

Crown Media is the parent of Hallmark Channel, and CEO Henry Schleiff told analysts Wednesday that at the end of second quarter the family-friendly network had 83.2 millions subscribers, an increase of nearly 650,000 homes compared with a year ago

“We achieved this increase notwithstanding the loss of approximately 1 million subs in the period January to June, due largely to a Nielsen adjustment correcting their overstatement of the number of EchoStar subscribers, which impacted all fully distributed channels,” Schleiff said.

EchoStar now operates its satellite service as Dish Network, with its hardware business spun off under the name EchoStar.

Because of Nielsen’s adjustment, roughly 40 cable networks saw their Nielsen distribution numbers decrease anywhere from about 200,000 homes to just over 1 million homes from January to July. Most of that overstatement related to Dish Network, a Nielsen spokesman said.

“We are working closely with out cable networks to understand some of the changes in coverage that we are seeing in the National People Meter sample,” the Nielsen spokesman said.

“Most of the changes are in the DBS segment of the sample,” Nielsen said. “In the past we used a method which looked at the ‘package’ that the household received. If a household received the package, we would say that all of the networks that were listed for that package were receivable.”

“Now we are checking the receivability of every set in the home and recording the channels and networks which are receivable,” he continued. “This has led to some declines in coverage for some of the networks. We are still working to understand the changes and will be updating clients on our progress.”

In fact, Nielsen did a presentation on the issue last week to the Committee on National Cable Audience Measurement, CONCAM.

Nielsen has been working to resolve the problem, and in fact its carriage numbers for a number of cable networks that had declined earlier this year have increased in August, the Nielsen spokesman said.

“In August we did show increases for many networks that had declined during the April to July period,” the spokesman said.

On March 27 Nielsen sent a memo to clients saying it was taking action “to correct an apparent understatement of the coverage-area universe estimates for approximately 20 cable networks that are received via DBS,” and that the issue was “limited to the 26% of households that receive cable programming through DBS providers.”

Part of the problem tracking the DBS distribution, Nielsen said in its memo, was due to the “rapid growth and the increase in the number of packages and channels available.”

As it turned out, Nielsen found that its distribution numbers for networks Dish Network was offering in many cases were being overstated, not understated.

Dish Network declined to comment Wednesday.

Hallmark Channel renewed its carriage deal with Dish Network in March last year, and that pact provided for a repositioning of the network, resulting in an addition of about 6.4 million Nielsen subscribers in May 2007, Crown Media said in the 10-Q it filed Wednesday. That contract also provided for carrying the Hallmark Movie Channel on a Dish Network package, increasing distribution of that Channel by more than 4 million subscribers.

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