Why Don't Cable Companies Collect Data on What All Subscribers Are Watching?

Every search you do on the internet, every subject you inquire about, is recorded, shared, and analyzed by various companies for their gain. However, when it comes to gathering information on subscriber viewing habits, cable companies don't follow the same protocols as other industries, like Nielsen. This article explores why cable companies don't collect data on what all subscribers are watching, and how this differs from traditional market research methods.

Why a Comprehensive Survey is Infeasible

One might wonder why cable companies don't collect data on what all their subscribers are watching. The answer lies in the impracticality and cost of such an endeavor.

Firstly, surveying every single subscriber would be incredibly expensive and time-consuming. Even if a small sample size were feasible, the results could change drastically over time or due to various factors. As a result, a comprehensive survey of all subscribers would not provide a reliable, up-to-date picture of viewing habits.

Moreover, when a sample is drawn, researchers understand that the results might not exactly match the overall population. For instance, if research finds that 90% of housewives watch cable TV from 11 am to 2 pm, this figure is an estimate. Depending on factors such as sample size, penetration rates, and other variables, the actual figure can vary by a margin, such as /– 3% or /– 5%.

The Role of Data Collection in Cable Companies

It's important to note that cable companies do collect data, but not in the same way as Nielsen. Cable companies track what the box is tuned to but not necessarily who is watching. This data collection is more about technical usage rather than individual viewing habits.

Nielsen, on the other hand, has shifted to using set-top boxes that people check in when they are watching. This method provides a better understanding of who is really watching the TV, their demographics, and other valuable insights such as what type of beverages they consume, whether they own a truck, and so on. This type of data collection is more accurate and detailed, providing a clearer picture of viewer profiles.

The Importance of Ratings in Traditional TV Marketing

Ratings play a crucial role in traditional TV marketing because they help advertisers determine which shows to sponsor and at what price. Advertisers rely on high ratings to justify higher advertising costs. Cable companies use this information to sell advertising spaces during their shows and maximize their revenue.

However, in the case of subscriber TV, a different model is at play. Subscribers pay for their monthly fees directly, and their TV providers show very little in advertising during their shows. Since they don't rely on ads for their income, they have no need to rely on ratings.

This difference in business models means that cable companies don't need to rely on viewer data in the same way that traditionally marketed channels do. Subscriber TV simply focuses on providing content that meets the needs and preferences of its subscribers, without the need to sell advertising spaces based on viewer data.

Conclusion

In summary, cable companies don't collect data on what all their subscribers are watching because it would be an impractical and expensive endeavor. They use more technical means to gather data on usage but not individual viewing habits. Nielsen has evolved to use more advanced methods, providing a better understanding of viewers, which is essential for traditional TV marketing. While subscriber TV providers don't rely on ratings for their revenue, they still have access to valuable data on technical usage, which helps them in providing better services to their subscribers.