Nielsen Passes First Mile Marker in Audit Marathon

Nielsen’s audience measurement meter technology has the Media Rating Council’s stamp of approval. But that’s only the beginning.

The company announced Thursday it has completed one phase of a long-term audit process, overseen by the MRC. Ernst and Young, the CPA firm conducting the audit, has signed off on Nielsen’s data collection and transmission system.

“It’s important, but there’s still a long way to go,” said David Gunzerath, SVP of the MRC, regarding the completion of the initial audit phase. “This is kind of a milestone.”

The approved portion of Nielsen’s overall measurement process involves meter installations, meter compatibility with panelists’ browsers, metrics, and other components. According to Nielsen, the meter technology is in operation in conjunction with its International Web panels, and is being connected to its U.S. measurement products.

ComScore’s audience measurement system audit is also ongoing. Gunzerath didn’t provide any information regarding its status, and comScore did not respond to a request for comment. “There isn’t much I can say other than comScore’s audit is also in process,” Gunzerath said.

If Nielsen is in a race to beat comScore in the audit marathon, to spectators, it seems like things are moving at a tortoise’s pace. It was over a year ago when Nielsen’s audit got fully underway, in the summer of ’07.

Why the inspections are taking so long to complete is not entirely clear, though technical intricacy plays a role. “This is a complex audit; it’s unlike anything we’ve been through,” Gunzerath told ClickZ News.

“It takes a significant amount of time because there are a lot of pieces in the audit,” said Mainak Mazumdar, Nielsen Online’s SVP measurement science. “We did anticipate it would take a significant amount of time.”

As for a timeline on audit completion, Mazumdar said, “We will move as fast as Ernst and Young and the MRC…want to move.”

The MRC acts as a liaison between the company undergoing the audit and the CPA firm performing it — in this case, Ernst and Young. Once the audits are complete, MRC members will evaluate the methodologies to determine whether or not to accredit them.

The next step in the audit process will require inspection of Nielsen’s enumeration processes and management of its audience panel, according to Gunzerath. “The way we’ve approached it is to divide the audit into several phases,” he explained, noting a similar segmented audit process is in place for comScore’s audience measurement system. Nielsen has also agreed to expand its original audit to entail its video measurement service.

Initiation of Nielsen Online’s audit, and later comScore’s, came about amid drama rarely associated with the typically numbers-driven world of media measurement. “The platform is still burning. You can help us put out that fire,” wrote Interactive Advertising Bureau CEO Randall Rothenberg in a lengthy letter sent in April 2007 to comScore and Nielsen Online (then Nielsen/NetRatings). The IAB chief expressed dismay at discovering, upon taking the job at the IAB earlier that year, that digital media measurement is as fraught with problems as traditional media measurement.

Rothenberg challenged the two audience measurement firms to throw back the curtains on their opaque methodologies. The growth of the online ad industry would be stunted were marketers to become even more frustrated with audience report discrepancies, the IAB said. Representing hundreds of digital publishers and media firms, the IAB has a particular interest in assuring the validity of online audience measurement systems.

In addition to its core audit, Nielsen Online has been working with MRC statisticians for over 18 months to help develop and define future Internet audits, said Mazumdar.

“We’re helping the industry to unlock…the complexity of Internet measurement,” said Mazumdar.