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Monday, June 13, 2005

Micro Media Fragmentation Begets Micro Ratings, Need For TV Search

MediaPost Publications Home of MediaDailyNews, MEDIA and OMMA Magazines
by Joe Mandese, Monday, Jun 13, 2005 7:46 AM EST
SAN FRANCISCO - THE IMPACT of micro media fragmentation on the major electronic media came to light last week during a series of presentations and panel discussions at MediaPost's OMMA West conference here. That fragmentation will make the kind of average ratings erosion that has pulverized the TV landscape with the rise of multichannel TV over the past 20 years look quaint by comparison. As hundreds, thousands and potentially millions of new channels come on stream, average channel viewing may become meaningless and could become replaced by new media search methods. That scenario is premised not on theory, said eMarketer CEO Geoff Ramsey, but on what already is occurring on the Internet where millions of Web sites vie for prominence among a relatively limited number that the average consumer actually visits each week.
According to an eMarketer analysis, the average Internet user now spends 7.5 hours per week online surfing among "millions" of sites, but actually visits an average of only 17 per week. By comparison, Ramsey pointed out that the average TV viewer spends 34.4 hours per week, but watches an average of only 13.6 channels per week even though there are about 100 available to the average household. The same principle holds up on radio, where the average listener listens to only 3.2 stations per week, even though there are an average of 73 available.

This principle has been well known within the TV industry for decades, and has been used by executives at the major TV networks to explain why they would always reap a sizeable share of viewing despite rampant cable channel fragmentation. That principle comes from the field of cognitive research, and is known as the "rule of seven plus or minus three." That rule suggests that given a virtually unlimited set of choices, the human brain will gravitate to a relatively small number - somewhere between 7 and 10.

Nielsen Media Research's data has born that out, with the typical viewer watching less than 14 channels per week. Given millions of choices, eMarketer's Ramsey said the same thing is true of the Internet, where only 17 sites are used by the average person during the average week.

The impact of a new TV channel explosion fueled by digital cable and satellite TV, broadband Internet and other sources, will likely make the TV channel environment more akin to the Internet than old-time television, and would lead to an entirely new TV navigation system, said experts participating in a MediaPost Spin Board panel discussion.

That system, they said, would be based on search, and would likely make search engine data as important for TV as it currently is for the Internet.

"The meta data of that data is more important than" the data published by many Internet sites, said Shelly Palmer, managing partner of Advanced Media Ventures Group LLC, and a Spin Board columnist.

Palmer was referring to the current influence of Internet search engines for navigating the Web, and the fact that paid search terms continue to grow in value for marketers and publishers seeking to capture user traffic. Palmer suggested we would soon see a "My Yahoo!, or My Google for TV," and that would lead to similar bidding for key TV search terms.

eMarketer's Ramsey noted that keywords and terms now rival expensive prime-time CPMs in terms of price and are growing fast.

Tom Hespos, president of Underscore Marketing, and another Spin Board columnist, said the more toward TV search was a natural outgrowth of Internet navigation, as well as basic human psychology.

He described this as the "brand effect" of search, noting, "If you're in the place where people expect you to be, maybe you're the guy to go to."

The Effects Of Media Channel Fragmentation
Average Hours Per Week:
Television 34.4
Radio 19.9
The Web 7.5

Number of Channels/Sites:
Television - 100.0
Radio - 73.0
The Web - Millions

Average Used Per Week:
Television - 13.6
Radio - 3.2
The Web - 17.0

Source: eMarketer.

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