Counting couch potatoes has turned into a mishmash for Nielsen, the venerable ratings measurement giant, because of the explosion of new media consumption devices. And the result may impact how big companies spend their advertising dollars.

The Economist reported consumers’ media-viewing habits have changed so rapidly, and in such fragmented fashion, that Nielsen has not been able to keep up.

Where once there was simply television to monitor, now consumers are spending more time on Internet sites, iPads, mobile phones and other devices and using digital video recorders (DVRs).

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“Everyone is unhappy,” Alan Wurtzel, president of research for NBC Universal, told The Economist. “If you can’t measure it, you can’t sell it.”

At stake is the $75 billion that advertisers spend on TV in the United State annually.
One ad measurement problem involves “time-shifted” viewing via DVRs and similar gear, whereby fewer consumers watch live TV and the majority skip ads altogether.

But the larger problem for Nielsen is how to track fragmented audiences. The $5.5 billion Nielsen business is a highly profitable one, but is “looking old-fashioned,” according to The Economist.

Nielsen extrapolates American TV viewing from a small sample of 22,000 homes. It has a separate panel to track online viewing, but those results are not yet wrapped into the main ratings. Tablets will not be included until 2014, and the firm has not yet begun to gather ratings for smartphone viewing.

Media firms say privately they would welcome new competition for Nielsen, The Economist reported.

By some accounts, stronger competition may be arriving.

BtoB magazine reported that comScore, a digital measurement firm, announced it has expanded its mobile measurement data to include information on more than 1 million smartphone users, 400,000 tablet owners and 150,000 households with home connection devices such as game consoles and smart TVs.

Meanwhile, Business Insider reported Twitter has purchased social TV data analytics startup Bluefin Labs. The acquisition gives Twitter a seat at the important intersection of TV, social networks and mobile media data.

For now, Twitter has an alliance in social media data with Nielsen. But Business Insider reported Bluefin’s technology will help Twitter build an audience analysis tool.

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