WPP-Nielsen JV plan fuel rivals’ concerns

by Phoebe Liu, Media Asia 04-Jun-04, 10:46

Media agencies have reacted nervously to reports that WPP is planning to launch a joint venture company offering TV ratings measurement with VNU, parent of Nielsen Media.

"The prospect of a large supplier of syndicated research being owned by an end-user company is always unsettling," said D Sriram, Starcom's CEO for Southeast Asia. "Having said that, it all comes down to what exactly they end up doing and how they communicate the separateness of the research company from any other WPP companies."

A UK newspaper reported that WPP and VNU have been discussing the potential tie-up since March, and expect to iron out the final details by the end of June. As part of the deal, WPP would reportedly increase its minority stake in TV measurement firm AGB to buy the company outright and then merge it with Nielsen's TV ratings service outside the US.

Neither side would comment on the deal, which has a precedent in India, where J. Walter Thompson research subsidiary IMRB runs a TV audience measurement service with VNU-owned research company ORG-MARG, an arrangement that has discomfited Indian media agencies.
"This cannot continue in the long run," commented R. Shrivathsa, associate business director at Carat India. "The ideal scenario is that it would be spun off into an independent body with some money given to WPP."
AGB provides viewing figures for two Asia-Pacific markets, Australia and the Philippines, while Nielsen Media provides TV audience figures in 11 markets across the region.
Meanwhile, Nielsen Media is streamlining its Media Index readership survey in Hong Kong, cutting the number of readers it interviews by almost a third, but adding booster samples for two key audiences, non-Chinese and high-income readers.
The smaller sample will increase the number of publications which fail to make it into Media Index reports because not enough people mentioned them, although Nielsen anticipates the drop-off to be "negligible".
Nielsen monitors 62 newspapers and magazines in Hong Kong, about half of which currently garner enough replies to feature in its report. The research company will review the survey's position in the city again at the end of the year.
"We are in the process of reviewing the whole plan with clients," said Nielsen Media Asia-Pacific managing director Forrest Didier.
The company is also increasing the number of Media Index reports it publishes each year in Hong Kong from two to four. Hong Kong revenues from Media Index have declined in recent years, because agency mergers and media fragmentation have reduced the number of potential buyers. There are no plans to make cuts to Media Index outside of Hong Kong, where Nielsen has upped investment in new analysis and delivery systems, and expanded the scope of the study.