Nielsen Gets Bought, CNN+ Launches, But Only On Amazon and Apple
1. Nielsen Gets Bought
A group of private equity investors led by US-based Elliott Investment Management and Canada-based Brookfield Business Partners spent $16 billion this week to acquire Nielsen and all its debt.
The buyout was not unexpected—Nielsen has been on the market for a while—but it again raised all sorts of questions about what the company’s ultimate path is and how the industry will react to their ACR and set-top-box data-driven Nielsen One which is due to launch in 2024.
Why It Matters
Given that Nielsen’s ability to pull off a successful Nielsen One launch in that time frame is a topic of frequent debate, the biggest question I’ve been getting all week is “what does this mean?”
And the short answer is “I have no idea.”
None.
Much will depend on what the PE guys do when they take over and beyond making some noise about keeping David Kenney in place, we really have no clue.
Best case scenario (for Nielsen) is they invest more money into the company with the goal of getting Nielsen One up and running a full year or so prior to 2024. That could help stem the tide of networks and agencies shifting to include alternate currency providers, but it’s just as likely that by this point it’s too little too late. At which point the launch of Nielsen One would mostly be about keeping them in the game on the streaming side.
There’s also that pesky no more MRC accreditation thing, something the new owners will want to make go away ASAP. Provided they actually can.
The thing to remember about Nielsen though, is that despite the widely held belief that no one actually watched linear TV anymore, the truth is most people still do, and a recent report from Leichtmann (whose research I actually trust) shows that 76.1 million homes still have some form of pay TV (vMVPDs and MVPDs) and while they may not watch it all the time, advertisers sure do spend a lot of money on it and they rely on Nielsen to provide measurement for all that viewing and ad spend.
As I noted last week, there are two schools of thought on Nielsen.
One is that they are like the U.S. dollar, providing a solid currency the entire (TV) world can transact off of, and that said world would fall apart and devolve into sheer chaos with them.
The other is that they are early 1980s Ma Bell, a lazy monopoly under no pressure to change or evolve, despite a wave of technological advances and deserve to be dethroned.
So there’s all that, and then there’s the fact that when my industry peers and I get together, one of the main topics of conversation is how clueless most Wall Street investors are about the changes brought about by streaming, how they really don’t seem to understand the business models that have emerged as companies own both the interface and the advertising on streaming. Not to mention the hardware and the software.
I do not know the PE group that bought Nielsen, so I have zero idea what their grasp of industry dynamics is and what their plans for the company will be.
So right now it’s just a waiting game, one whose rules will no doubt change again after this year’s upfronts.
What You Need To Do About It
If you’re Jesse Cohn and Marc Steinberg, the two guys who seem to be leading the PE charge, slow and steady. Nielsen is still the currency for most of the industry, but rushing Nielsen One to market before it is fully baked would be a disaster for the company’s future plans.
OTOH, you may be anticipating that and figuring that like AOL and Yahoo, Nielsen’s linear customer base is more like a very slowly deflating balloon, that there will be massive amounts of money to be made in the decade(s) to come, given that linear pay TV isn’t going anywhere—cord cutting has a very definite floor, somewhere around 30% to 40% of viewers will only give up cable when someone pries the remote out of their hands. So you can definitely profit from Nielsen while hoping to sell off what remains to whichever alternate measurement platform becomes the Big Kahuna. (Haven’t used that phrase since the 90s but it fits.)
If you’re iSpot, VideoAmp, Comscore, Innovid/TVSquared, Conviva et al, this is the textbook “wait and see” situation, but it probably isn’t bad news in the grand scheme of things, so keep on keeping on, and you can react when you see what the PE guys are up to.
If you’re an advertiser and you’ve been burying your head in the sand because all this streaming stuff is too confusing, time to de-ostrich. The hybrid world is here, it’s not going anywhere and you’ll just have to deal with it.
2. CNN+ Launches But Only On Amazon and Apple
CNN+ launched this week for the intro lock-it-in-for-a-lifetime price of just $2.99/month, though the only people who can watch it on an actual television set are those with an Amazon Fire TV stick or Apple TV puck. Which, according to Conviva, account for just 19% and 6% of all streaming TV viewing time, respectively.
That’s going to severely impact the number of people who sign up, even at the super low intro rate, because, well, CNN already has a really good website and smartphone app that works well even if you’re not a cable subscriber, and the new service is all about the sorts of lean back shows (Anderson Cooper on parenting) that you probably would not watch on a laptop.
Why It Matters
There are a host of unanswered questions about CNN+, both existential and practical.
The existential questions are about the actual future viability of cable news. On the one hand, the news out of Ukraine might have many people feeling good about having access to CNN via their pay TV provider and/or wishing that they did have access if they don’t.
On the other, the major print-based news sites—the New York Times, Wall Street Journal and Washington Post—have all done a stellar job of updating us on war news in something close to real time.
And unlike CNN, they are not overrun with painful pharma commercials.
So that’s the big question: one month in, are people looking to the Times, Post and Journal for the latest war news, or are they still tuning in to CNN?
Are they watching clips of the Ketanji Brown Jackson hearings on social media or are they tuning in to CNN?
My gut says that after an initial bump, most people went back to the web—you can only watch videos of shelling so many times before they all start to blend together and live Congressional hearings can be unbearably slow.
Add in too, the fact that cable news viewership trends very old, 60 and up, and its seems as if maybe there isn’t much desire for cable news anymore. Especially given how partisan it’s become, and how un-newslike: the top shows are all essentially higher production value equivalents of podcasts, with hosts opining on the news rather than actually, you know, covering it.
So those are my existential questions and then there’s the practical one: will CNN+ be offered as part of a bundle with the newly combined Maxcovery+ app? Will it be an add on to that app? And if so, does my $2.99 early bird special carry over?
That’s got to be stopping a lot of people from signing up, especially those who are already HBO and/or Discovery subscribers, and it seems like TPTB should have thought that one through and come up with an answer for it.
The other practical question is how close is CNN+ to signing a deal with Roku, Samsung, VIZIO, LG and Android?
Next week close or months from now close? Obviously, that too is going to affect the number of early sign-ups.
Finally, it’s been curious too to see the focus on Roku and Android, given that more and more viewers are ditching the dongle and watching directly from their smart TV’s OS and that CNN+ is not on VIZIO, Samsung or LG at launch either. That’s likely a matter of the non-trade press media catching up to the reality on the ground, but it is worth noting.
What You Need To Do About It
If you’re CNN, you should probably explain how that lifetime offer works if you do indeed become a part of Maxcovery+. Though I 100% understand why you might not want to lock yourself into a position today that you might come to regret tomorrow.
And of course you’ll need to get carriage deals struck with more operating systems, but you don’t need me to tell you that.
If you’re the rest of the TV industry, now is the time to get out the popcorn and see what happens: will millions of people find the need to have access to 24/7 cable news in times of crisis worth an extra $3/month? Will people who suspect they may someday become cord cutters take advantage of the deal? Are there millions of people out there who want the type of more intelligent news/lifestyle nonfiction programming that CNN+ has on offer?
And of course, will they do a good job marketing it, given that (a) it is a unique category and (b) cable news has become such a culture war touchpoint?
We will know soon enough.
