The Local Ratings Landscape

1. The Local Ratings Landscape George Ivie CEO, Executive Director Media Rating Council, Inc.

2. Agenda • Introductions • Review of Emerging Local Measurement Alternatives • Arbitron PPM • Nielsen LPM • Viewer Modeling • Questions/Answers

3. Our Panel: • Erwin Ephron, Consultant, Ephron, Papazian & Ephron, Inc. • Jay S. Guyther, SVP International Marketing, Arbitron, Inc. • Ken Wollenberg, SVP NSI, Nielsen Media Research

4. Summary Format • The “Basics” • Conceptual Advantages • Conceptual Questions …for each alternative None are currently Accredited by the MRC

5. Arbitron PPM • The Basics: • The PPM: • Personal measurement • Pager size device -- worn or carried • Recognizes inaudible codes in media source that consumer is “exposed” to • Self-Installed by telephone-recruited panelists • Tested in UK, now being tested in the US • Encoding-based measurement • Measurement is possible for Radio, Television (broadcast, wired cable, satellite, digital, etc.), and Streaming per Arbitron

6. Arbitron PPM • Conceptual Advantages: • Multi-media data from single sample • “Partially” passive • Measures out-of-home? • Large sample sizes planned • Measures digital sources • Measurement is dependent on encoding…not calibration of tuner

7. Arbitron PPM • Conceptual Questions: • Does it work? • Will panelists carry the device? • Arbitron indicates its tests prove “yes” for both items above • “Exposure” to audio…is a changed basis for crediting audience • Everyone must encode…no encoding, no measurement, e.g., local cable • For television, muting equals non-measurement • Uncertainty of joint venture arrangement • Response Rates

8. Nielsen LPM • The Basics: • Movement of People Meter technology into the local measurement arena • Set meters with added people button device • Calibration of tuners • Software solutions for some digital cable/satellite • Boston roll-out, scheduled to become official in May 2002 • 600 Households • Demonstration period since April 2001 • Further markets planned after Boston

9. Nielsen LPM • Conceptual Advantages: • Known performance • Continuous electronic measurement of both households and people • Eliminates the diary and the integration process • Larger effective sample sizes

10. Nielsen LPM • Conceptual Questions: • Viewing levels and shares change • Two issues being studied in Boston • Tuning without viewing • Distribution of NILF Females • Intrusive metering is still the rule • Button pushing requires coaching / Nielsen field staff diligence • New viewing technologies require different metering approaches…and marketplace cooperation • Will the stations support the Service?

11. Viewer Modeling • The Basics: • A model used to predict viewers directly from the composition of the set meter panel itself, without the use of the diary • Multiple regression technique • Initial project is to model eight key persons demos and then apply to other demos as well • Validation tests planned using Boston LPM data

12. Viewer Modeling • Conceptual Advantages: • Principally cost (and per Erwin – better data)…increased set meter sample sizes could be gained through elimination of diaries, with modeling handling the demography • Expansion of number of meter markets • Consistent methodology across all NSI markets

13. Viewer Modeling • Conceptual Questions: • Will the marketplace accept a modeled technique? • Can an accurate enough model be constructed? • How to decide when separate models are necessary? Smaller breaks…presence of children…race…etc. • Model updating? New programming? Sports? Specials? • Ongoing evaluation of accuracy?