|Viewing Single Post From: Nielsen Sued for Billions|
|lightandday||Jul 30 2012, 04:22 PM|
HBD-Nesta Robert Marley,February 6, 1945 BitchesBrew
New Delhi Television Limited, India's oldest and largest news network, has lobbed a legal grenade at The Nielsen Company.|
In a 194-page lawsuit filed in New York court late last week, NDTV accuses Nielsen of violating the Foreign Corrupt Practices Act by manipulating viewership data in favor of channels that are willing to provide bribes to its officials.
According to NDTV, rampant manipulation of viewership data has been going on for eight years, and when presented with evidence earlier this year, top executives at Nielsen pledged to make changes. But the Indian news giant says these promises have been false ones.
The Indian company is now seeking billions of dollars in damages from Nielsen, looking to punish its top corporate officers, and demanding that Nielsen essentially be kicked out of the country.
The lawsuit contains merely allegations against the venerable ratings research company that operates in more than 100 countries, earns more than $5 billion a year, and has been around since 1923. But if proven, they could be very serious. A Nielsen spokesperson said the company "has a longstanding policy of not commenting on pending legal matters."
In the complaint, NDTV targets "TAM" (Television Audience Measurement), a joint venture between Nielsen and Kantar Media Research. NDTV says the two companies (each named as defendants) were once rivals but decided to operate jointly within India to monopolize the market for TV viewership data. The board of TAM is said to be comprised of officials from the two companies.
Nielsen, which formerly owned The Hollywood Reporter, is described as a company that is now owned by "sponsors," private equity firms that include KKR, The Blackstone Group, The Carlyle Group, Thomas H. Lee Partners, Alpinvest Partners, Hellman & Friedman and Centerview Partners. These firms are said to be executing an "exit strategy" out of the Nielsen business, and as a result, have ordered Nielsen directors and CEO David Calhoun into making cost cutting and cost avoidance measures to maintain their share price in the short term.
As a result, NDTV says that Nielsen's officers have been "recklessly disregarding" their responsibilities to laws and their customers, and that the cost-cutting measures has been one of the main reasons behind manipulated TV viewership data.
"The primary reason that data could be so easily manipulated in India was due to the persistent refusal of Nielsen and Kantar to provide adequate funds for TAM to increase its sample size and invest in the systems/quality/security procedures," says the lawsuit.
Specifically, the results of viewership data are alleged to be based on a very small number of 8,000 households. And because of the small sample size and alleged lack of security protocols, corruption is said to have blossomed in a country where "politicians also own cable networks" and "PeopleMeters have been installed at the residences of government officials, where tampering of the data also takes place."
STORY: TCA 2012: CW's Mark Pedowitz Talks 'Gossip Girl,' 'Muppets' and Flaws in Nielsen Measurement
The tampering of data is said to have been a known problem since 2004 and discussed in public industry-wide meetings.
For example, last November, in a Mumbai meeting of the Board of Directors of News Broadcasters Association, NDTV's executive vice chairperson Narayan Rao presented a report about the fiddling of PeopleMeters, the company's audience measurement tool, including how some were "subverting the ratings system by 'discovering' the panel homes that have PeopleMeters installed in them, doctoring data emerging from 'parallel homes', providing a separate TV in select panel homes for viewing while the TV linked to the meter was tuned to specified channels, misuse of the guest button where up to 10 guests can be shown watching even when there is no one there..."
These acts are allegedly happening as TV channels in the country are covertly providing monetary inducements for the manipulation of data.
Such evidence was presented in meetings with Nielsen earlier this year, according to the complaint.
In late February, representatives from Nielsen are said to have heard from a consultant about how employees at TAM took bribes to fix ratings for channels.
By April, at another meeting, representatives of Nielsen are said to have "unequivocally admitted that the information provided by NDTV’s Consultant was highly credible," with laptops from TAM officials seized and sent to the U.S. for forensic analysis.
Despite allegedly admitting the corruption and manipulation, NDTV says that all promises to make changes are a "sham" and that bad data continues to get released "recklessly and in pursuit of profits."
NDTV says it is being hurt by the manipulated ratings.
"This loss of hard earned reputation and goodwill along with the damage to the profitability of NDTV as a result of low advertising revenues has in turn severely damaged the brand value of NDTV," it says in the lawsuit.
The company says its share price has fallen from a high of 501 Indian rupees at the beginning of 2008 to under 26 at the end of last year.
NDTV is now demanding significant damages, at least $810 million for fraud, at least $580 million for negligence, and hundreds of millions more for a range of causes of action including tortious interference and breach of fiduciary duty.
To see more of this from THR TheHollywoodReporter
|Nielsen Sued for Billions · Primetime News & Spoilers|