Soon to be worthless: Nielsen Net Ratings and comScore Media Metrix

Reuters is creating a new financial "blog ghetto."

Their business model appears to be essentially a "Seeking Alpha" aggregation approach, with the added element of splitting advertising revenue with the analyst/authors. Over the summer, I was asked to participate in this. I wasn’t interested in 30% of the revenue for 100% of my content. 

Howard Lindzon notes some of the more onerous requirements of the Reuter’s contract at his blog. One item in particular grabbed my eye:

"You agree to sign the Letters of Agreement assigning all key syndicated traffic
measurement firms, including but not limited to Nielsen Net Ratings and ComScore Media Metrix . . ."   
-Reuters blog revenue sharing contract

Over the past quarter, two other media outlets looking to share advertising revenue, each asked for a similar clause:

traffic to your blog will then be assigned as traffic to ________."

This is intriguing: I have now seen this or similar demands from 3 separate mainstream media outlets: A wire service (Reuters), a financial magazine, and a major newspaper. In all three examples that I reviewed, the blog itself isn’t transferred or sold to the media outlet (for examples, see Kevin Drum/Washington Monthly or Andrew Sullivan/The Atlantic).

Note that this is not only to measures ads, but for all traffic: While I do understand they are trying to show the collective reach of the
advertising, but that is not how it is stated in the contract. "Blogger
will assign ALL MEASURES OF WEB TRAFFIC" just seems wrong.

That is not what this about — they are merely acting as advertising
agency, selling and placing ads, and then sharing the revenue. Its one
thing if they have a specific ownership relationship (purchase,
employer etc.)

This is big business, with online advertising now $20 billion per year.

What does this clause actually mean — to the new measuring metrics, to bloggers, and to the Media’s push onto the web? Let’s consider the ramifications:

1) This is nothing short of a naked grab to steal Blog traffic numbers, and artificially boost MSM web traffic numbers.

The print editions of newspapers and magazines have been seeing their circulation numbers ebb, while the web versions are signficantly growing. However, trying to figure out how to "game" these traffic ratings is not exactly what "competition in the market place is all about. Imagine if Baseball teams could buy wins, if TV shows could buy ratings, if CDs could buy sales.

There is a faint whiff of desperation to this.

2) Nielsen Net Ratings and comScore Media Metrix data are soon to be — assuming they are not already —  worthless bull$h%t. If these ratings companies are complicit in this arrangement — or if they even know and  tolerate it — their business model goes kaput. Since major MSMedia are attempting to buy ratings, these rating will no longer accurately measure true traffic. I’m not saying its fraud, but it sure smells like bullshit.

What will occur instead is that Nielsen Net Ratings and comScore Media Metrix will actually be a measure of how many fools various publishers can get to sign documents assigning the bloggers’ traffic to themselves

Neat trick, but the data becomes meaningless.

3) This means that, very soon, web Advertisers will no longer be able to trust the data they get from publishers or these traffic rating agencies. Ad revenue rates are based on click-throughs and page-views. However, CPM rates are negotiated — not measured. Hence, I assume is that this is for setting higher CPM rates (plus bragging rights).

4) I don’t know the VCs behind the rating outfits, but I cannot believe the original pitch included anything like  "And, our ratings can be easily traded and assigned, making them essentially worthless as a web metric."

I don’t know if "Fraud" is too strong a word, but if I were them, would be very, very pissed off. Why? I will bet you that the web traffic scores will soon be as informative
and reliable as the S&P or Moody AAA ratings on sub-prime mortgage CDOs.

5) I have seen what is practically the identical proposal from several
different, unrelated media firms.

This makes me think that the same
brain trust is behind it — some law firm/think tank/McKinsey-type
group. Amusingly, it looks like the sleazy consultants/law firms sold
it over and over to different media outlets.

If their advertising model lacks ethics, do you suppose these firms have any themselves? Lesson for the media: When you get into bed with these sleazoids, expect them to try to screw you over also!

To err is human, but it takes an MBA-laden consulting firm to create a true clusterf@#& . . . .


UPDATE:  October 8, 2007 3:44pm

VentureBeat notes the ongoing confusion between advertising measures and traffic measures:

Glam to sign $1 billion ad deal — and draws critics    

Numbers are being thrown around that make this all a big game of smoke
and mirrors, and every player is wrapped up in this. Note, for example,
that Sugar claims 4.5 million unique visitors a month, as reported by Techcrunch.
Brian Sugar tells us these numbers are based on Google analytics.
However, Comscore, which is what advertisers rely on, shows a much
lower number.


U.S. Web Ad Spending Nears $10 Billion In First Half ’07
InformationWeek, October 4, 2007 03:00 PM

A New Ratings System Stirs Up the Fall TV Season   
NYT, October 8, 2007

The Battle for the Consumer Online 
NYT, October 8, 2007

Extra! buys Newsvine   
Paul J. Gough
Hollywood Reporter, Sun Oct 7, 2007 11:52pm BST

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What's been said:

Discussions found on the web:
  1. Ken M. commented on Oct 8

    Good Rant !!

    Laughed out loud at the S&P, Moody’s comment — a great start for a Monday AM.

  2. jb commented on Oct 8


    Isn’t this just like buying gross sales numbers? Big fish buys little fish sees growth in sales…

    What’s the big deal? If you start blogging for Reuters, shouldn’t they see an increase in web traffic?


    BR: In all three examples, the blog isn’t transferred or sold to the media outlet — they are merely acting as advertising agency, selling and placing ads, and sharing the revenue.

    Its one thing if they have a specific ownership relationship (purchase, employer etc.) — but that is not what this about.

    For examples, see Kevin Drum or Andrew Sullivan.

    I’ll add this up top, so as to make the point clearer . . .

  3. 12th percentile commented on Oct 8

    The concept of this approach shows that the people trying to boost their traffic numbers to increase ad revenue don’t understand how online advertising is evolving. Who in their right mind would buy ads on a CPM model these days? I’m sure there are some ways it could work but they would be the exception.

    The whole inflated web traffic ruse to sell ads had been around a long time. Many people buying the ads don’t understand the basics of site traffic analysis and end up paying for things that don’t exist (I’d call that fraud). It wasn’t too long ago that people were still bragging about their site “hits” when selling ads. Ask them for their unique visitor numbers and they would change the subject.

    I don’t think they give courses in site traffic analysis at Harvard B-school.

    There are vendors out there who will try to tell you they can estimate the site traffic numbers for industries and for individual websites. I’ve looked into their methods and I’ve also tested them against some of my own client sites (they didn’t realize I had access to the real site traffic numbers from the log files). I have yet to see anyone come close to being accurate in estimating the site traffic if they don’t have the log files. I have been in many meetings with marketing groups and been asked, “can you figure out how much traffic our competitors are getting?” My answer was always that there was no way to do that legally.

    Basically if you have legit site traffic, you can make money and don’t have to try to pump up your numbers. For most recent example check out this story. generated a million dollars in revenue last year and is on track to do the same this year. Already, Qualls has turned down outside funding for her site and a verbal offer from someone willing to pay $5 million to buy her company.

  4. Adam commented on Oct 8

    A lot of publishing companies believe that the future of what we now call “newspapers” is a “blog ghetto”, where readers can access various bloggers’ pieces on one centralized website (e.g. everything is one click away). What they fail to recognize is that Microsoft inadvertently created a blog ghetto years ago. It’s called your Favorites Center and it comes with Internet Explorer.

    Now, I can see how a publishing company can benefit bloggers like Barry by concentrating on acquring advertisers and maintaining IT, allowing the blogger to focus on more and better content. That said, those services are worth nowhere near 70% of advertising revenues. 15-20%, tops.

  5. Mike Nomad commented on Oct 8

    Nice article, Barry.

    Welcome to the record biz. When SoundScan (also a Nielen commodity) was getting started, it provided joke fodder for months. Everything they claimed SoundScan would fix actually got worse.

  6. Justin commented on Oct 8

    Why don’t they just ask the FED to bail them out? Fuck they are making more speeches lately than the preacher at The Dallas First Baptist Church…

  7. sujal commented on Oct 8

    This is a pretty common practice, even among big sites. I used to work for and they roll up traffic from a host of partners in order to maintain their number 1 position in uniques. It often was simply enough to have our headlines showing up in front of unique eyeballs, not just ads.

    And the comment above about CPM ads being stupid is a bit off the mark. PPC models makes sense when your ads are directly about selling something or making a sale, but brand advertising (look how cool you’d be if you used Nike) is still about getting in front of eyeballs…


  8. cm commented on Oct 8

    No, Barry, I think this is precisely what today’s “economy” and other social interaction are increasingly about — managing perceptions and bullshit preferrably without contributing net value.

  9. 12th percentile commented on Oct 8

    And the comment above about CPM ads being stupid is a bit off the mark

    I didn’t say it was stupid, more that it is crazy. I’d prefer to build the brand AND make money. I don’t believe those two are mutually exclusive. But if all you want to do is put ads online that no one will click on, I’m sure there are endless opportunities for you to spend your budget and build your brand. is a good example of a company that built a brand online with massive sustained online ad buys. Of course they also have a good product and people click on the ads and go to their site.

    And FWIW, Nike is spending at least some of their budget on a CPC basis.

  10. Christopher Laudani commented on Oct 8


    Watch out! Maybe this will give ideas for their own financial blog ghetto.

  11. Hans Suter commented on Oct 8

    I’ve asked Erwin Ephron for a comment on this. I hope he’ll show up.

  12. donna commented on Oct 8

    Geez, the Internet was so much more fun before business got involved in it!

    But then, I’ve been playing on it since it was the ARPAnet, so I’m a bit spoiled….

  13. wunsacon commented on Oct 8

    I believe George Carlin said that our biggest industry is the manufacture of bullshit.

    (Unfortunately for me, I’m not getting accustomed to the smell.)

  14. paul commented on Oct 8

    Adam, I don’t think part of the deal is IT or support for the blog. Just “assign us all your traffic” (even if most people continue to read it here at bigpicture.typepad rather than That’s where the scam comes in.

  15. Barry Ritholtz commented on Oct 8

    I am looking at two different measures: if you want to see how many times an ad is served or clicked, that’s one specific, easily quantifiable metric.

    I do understand they are trying to show the collective reach of the advertising, but that is not how it is stated in the contract. “Blogger will assign ALL MEASURES OF WEB TRAFFIC” just seems wrong.

    Perhaps I am uncomfortable with the “Network” conceit. Its a distributed ad network, not a true broadcast network. Perhaps its because I rely on metrics to measure specific items like Inflation (CPI) or Employment (NFP)

  16. Sherman McCoy commented on Oct 8

    The story of aka “ 3.0” to some people- will give you some ideas of where this strategy is supposed to lead. Read this:

    And then this:

    It’s not a bad thing to build a network- porn-hocking guys like me do this for both SEO and to create more targeted and direct marketing efforts. And the “network effect” seems to be a real phenomena.

    But what Barry describes here is just MSM trying to go down this road using their pre-existing corporate weight and by slipping these clauses into their contracts in an underhanded way. That will just add to major advertiser’s distrust in internet advertising due to the lack of concrete effectiveness metrics.

  17. Jason Barnes commented on Oct 8

    Online advertising continues to be plagued by bad press; from click fraud to spyware and now the reliability of traffic data is coming into question. While online ad spending is improving, trust in online ads and online advertising doesn’t seem to be.

  18. howard lindzon commented on Oct 8

    The point here is this is a crap form letter by a major news source.

    Any true intentions fromreuters would have easily been covered in a two line letter saying we like your stuff, we should talk about opportunities. This is just a spam letter to all financial bloggers fishing for traffic.

  19. David commented on Oct 8

    Thanks Barry & Howard, interesting stuff.

    They’re getting desperate. Obviously a sucker deal as many at Howard Lindzon’s site have already pointed out.

    It’s all about getting on the bandwagon for them. MSM wants blog-like features and credibility, hence the recent huge deal with MSNBC and Newsvine. If they can get it for peanuts, even better, right?

  20. ostiguy commented on Oct 8

    Is Comscore still completely dependent upon their browser plugin – aka, it is still 1997?

  21. Adam commented on Oct 9

    Great blog. I agree with you. Theses traffic
    assignment clauses became common since the late 90s; you would be surprised how many sites cave into this demand by the party offering millions of eyeballs.

  22. The Big Picture commented on Oct 9

    Distributed Content Blog Advertising Model

    A few people wrote in to ask me about yesterday’s Nielsen/Media Matrix rant. -Some pointed out (privately) the flaws in these systems, noting they have been very error-prone in other media — radio, television, newspapers — for years. -A few told me I…

  23. dumdum commented on Oct 9

    Barry barry barry – don’t ya think that assigning traffic to nielsen/comscore is worth being able to monetize your site? you will never be able to get advertisers like reuters can w/o building a large sales team. i think you are missing the ‘big picture’…

  24. Jim Bergsten commented on Oct 9

    I guess I don’t see why one would expect better behavior from the same folks who bring you:

    — Sweeps, where standard programming is replaced by specials, yet ad rates are based on the numbers.

    — PBS pledge periods, where standard programming is replaced by specials to boost membership.

    Nobody “in the know” believes any of the numbers. Nobody “in the know” cares — they are just raking off a percentage of other people’s money (in this case, the companies placing the ads).

  25. A Dash of Insight commented on Oct 10

    Financial Blogs and Choosing Your Source: Credentialism?

    At A Dash we are exploring the topic of financial blogging. Last month we had a two-part series (here and here) stimulated by an outside comment on blogs versus regular journalistic sources. Readers should check out the full argument, but

  26. John F. commented on Oct 11

    “Blogger will assign ALL MEASURES OF WEB TRAFFIC” just seems wrong.

    Sure does, and the reason may be your omission of the word SYNDICATED. My guess, based on the language above, is that when I go to, the click goes to you, whereas if I go to, they get the click.

  27. John F. commented on Oct 11

    “Blogger will assign ALL MEASURES OF WEB TRAFFIC” just seems wrong.

    Sure does, and the reason may be your omission of the word SYNDICATED. My guess, based on the language above, is that when I go to, the click goes to you, whereas if I go to, they get the click.

  28. JB commented on Oct 12

    For Nielsen measuring purposes, what I want to understand is, is this blog ghetto traffic being assigned to the “parent” level of Reuters or the “brand” level. That may seem like splitting hairs, but to media buyers who use this tool, it’s not. For example, Time Warner parent is huge in traffic because it includes AOL. The “brand” level just includes and is probably so low that it doesn’t register on Nielsen. If Reuters is aggragating blog traffic into the parent, that’s fine. If it’s aggregating it into the brand level, that’s deceit because the brand by definition is what is in the domain name -i.e, And if a media buyer or any user of Nielsen does a search on “reuters” on Netview (the relevant Nielsen product in this case) they will see the different levels pop up – brand, channel, parent. I’m a client of Nielsen, so I’ve seen this with many companies that have a parent name that can be confused with a URL – NYTimes parent includes since its owned by the NYT Company, but the brand does not include traffic.

  29. Jeff commented on Oct 15

    Google Analytics numbers are much more reliable than those from ComScore and Media Metrix. It may be that people look at Media Metrix more often, but they shouldn’t be because those numbers are completely flawed. With Google Analytics, there is code embedded directly on the site’s pages, which much more accurately determine traffic. I’ve never understood why anybody would look to services like Media Metrix that don’t depend on actual code on the pages as opposed to Google Analytics, which does.

  30. Hoopla commented on Oct 22

    There is a lot of mis-understanding here about how the assigned numbers are being used. The Nielsen and Comscore numbers go into tools that are used by ad agencies to decide where to buy and how much.

    Unfortunately, they are generally to lazy to piece together different “sites” to figure out how much the representing company has to sell, so they only look at content that is “rolled-up” under the parent in their tools.

    To effectively sell the ads on your site, anyone representing you will need to do this. However, I agree that their language was way too broad.

  31. Hoopla commented on Oct 22

    I wish JB was right, but Google Analytics, and all other website analytics tools, have some huge problems with getting accurate audience (not page view) numbers. This figure is key for advertisers, because how many people see your ads is more important than how often.

    Cases where site analytics tools count a “unique user” twice:
    – User deletes their cookies
    – Anti-spyware program deletes analytics tool cookies
    – Same user on a different computer (home/work/handheld)
    – User switches browsers (eg. MSIE to FF)

    All of these add up and inflate publisher side unique user numbers. The only solution is to track actual user behavior across all places they access the internet.

    Of course, you don’t want to get me started on all the problems and inaccuracies with Comscore and Nielsen’s methods and data. Unfortunately, the agencies use them, so publishers and rep firms have to play ball.

  32. chamila commented on Mar 14

    Isn’t internet marketing all about generating as much traffic as possible and converting this traffic into signups and sales?

    I know it is… that’s why I concentrate on getting as much free traffic to my website as possible. Here is one great source that has helped me a lot.

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