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Broadcaster New Delhi Television Ltd is seeking more than a billion dollars in damages from The Nielsen Co. and its affiliates, claiming the global research firm fudged viewership data.

NDTV filed a case against The Nielsen Co. in a New York court for “manipulating television viewership data in favour of channels that were willing to offer bribes to its officials," according to a news report filed by The Hollywood Reporter late last week.

NDTV is seeking “compensatory and punitive damages" from the Nielsen group, Kantar group, TAM Media Research Pvt. Ltd and a host of Nielsen directors including its global chief executive David Calhoun for causing financial loss and loss of reputation and brand value by releasing incorrect viewership data, according to the petition, a copy of which is available with Mint.

TAM is a joint venture between Nielsen and Kantar (the market research arm of London-based advertising and public relations firm WPP Plc) in India and was launched in 1998 to provide television viewership data.

“Low ratings for NDTV news channels have also led to public claims by other news channels of being the number 1 (one) channel," the broadcaster said in its petition. “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."

The broadcaster is demanding $810 million ( 4,520 crore) for fraud and $580 million for negligence, in addition to other claims, according to the petition.

It’s claiming the damages for “loss of advertising revenues, increased carriage costs, loss of reputation, loss of goodwill, loss of stock value, and loss of other revenues," the petition added.

A TAM Media spokesperson declined to make a statement, saying the company “doesn’t comment on any litigation." NDTV officials said they could not comment as the matter is in court.

According to the petition, after NDTV exposed rampant corruption and security breaches in TAM data to top officials of the Nielsen group and Kantar, it requested them to stop releasing data until the issues were resolved. But despite promises of remedial measures, the companies did not take corrective action and continued to publish “data corrupted by lack of security and lack of adequate sample size," it said.

Both NDTV and the News Broadcasters Association had requested TAM to increase the sample size to 30,000 and strengthen security measures.

TAM’s website states that it “has the largest sample in the world comprising 36,000 individuals from across 165 cities and towns covering 8,150 TV homes from class I towns (all towns and cities with a population of more than 100,000) and semi-rural towns (less than 100,000 population) from the state of Maharashtra."

A system in which a small outfit decides the fate of $2 billion of advertising expenditure on television is fundamentally flawed, said the chief executive of a Hindi news channel.

“Besides, the lineage of the company is also intriguing. Kantar Media, the research firm which has equity in TAM, is owned by a major advertising conglomerate, the WPP group. WPP has a large
presence in India through its media agencies such as Group M and others," the CEO pointed out, declining to be named given the sensitivity of the matter.

He added that TAM was accepted by the industry in the absence of a better system. “But it should go through scrutiny for statistical correctness and should give margins of error clearly."

“There is scope for improvement in the rating system. For a start, 8,000 Peoplemeters (an audience measurement tool) are not sufficient for a diverse country like India," said Ashish Bhasin, chairman, India, and CEO, Southeast Asia, at Aegis Media India Pvt. ltd, a media buying agency. “Industry sees these as issues and has itself been trying to set up a more robust system of ratings."

A top official at an English language news channel lauded the move by NDTV. “It is a bold step. TAM has been a big disappointment to most news channels," he said, also refusing to be identified.

Jawahar Goel, former president of the Indian Broadcasting Foundation, a body of all television channels, and the managing director of Dish TV India Ltd, said that NDTV had taken a bold step in challenging the TV ratings systems agencies. “They must have enough evidence to make such a move," he said.

Will the broadcast industry support the move? “People may be sympathetic, but I don’t know how many of them will take up the issue. We had also stopped subscribing to TAM data at one point along with Star and Sony. The move did not work in the long run as one broadcaster backed out," Goel said.

The CEO of a large media-buying agency said he expects other channels will now be emboldened by NDTV’s move though most will keep their positions guarded for now. “They will wait for the outcome of this case," he said, declining to be named.

Satyajit Sen, CEO of media buying agency ZenithOptimedia, however said: “It is a sad day for the industry. TAM is the currency which the industry has been using for a decade. One would imagine a certain rigour goes into this process. The faith of the industry has been questioned. We hope that the whole thing falls in place."

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