Nielsen Ratings

The system has been updated and modified extensively since it was developed in the early 1940s by Arthur Nielsen, and has since been the primary source of audience measurement information in the television industry around the world. Since television as a business makes money by selling audiences to advertisers, the Nielsen Television Ratings are the single most important element in determining advertising rates, schedules, and program content.

Nielsen Television Ratings are gathered by one of two ways; by extensive use of surveys, where viewers of various demographics are asked to keep a written record of the television programming they watch throughout the day and evening, or by the use of Set Meters, which are small devices connected to every television in selected homes. These devices gather the viewing habits of the home and transmit the information nightly to Nielsen through a "Home Unit" connected to a phone line.

Nielsen Television Ratings are reported by ranking the percentage for each show of all viewers watching television at a given time. There are an estimated 112.8 million television households in the USA. A single national Nielsen ratings point represents 1%, or 1,128,000 households for the 2006-07 season.

Nielsen ratings Media Research also provides statistics on estimated total number of viewers, and on specific demographics. Advertising rates are influenced not only by the total number of viewers, but also by particular demographics, such as age, sex, economic class, and area. Younger viewers are considered more attractive for many products, whereas in some cases older and wealthier audiences are desired, or female audiences are desired over males.

Television Nielsen ratings are not an exact science, but they are a powerful force in determining the programming in an industry where millions of dollars are at stake every day.

Because ratings are based on samples, it is possible for shows to get 0.0 rating, despite having an audience; CNBC talk show McEnroe was one notable example.

Nielsen provides viewer-ship data calculated as the average viewer-ship for only the commercial time within the program. This “Commercial Ratings” first became available on May 31, 2007. Additionally, Nielsen provides different “streams” of this data in order to take into consideration delayed viewing (DVR) data. Nielsen ratings clients now have access to all the data they need to develop individualized minute-by-minute ratings of national commercials by demographic group for all national television programs, including DVCPRO playback at any interval up to seven days.

Much of the Nielsen ratings system, however, still consists of the completion by viewers of ratings diaries, in which a viewer records his or her viewing habits, generally for a week, in exchange for being advanced a nominal amount $5 in the United States.