4A’s Asks FTC to Investigate Nielsen

Conflict between the American Association of Advertising Agencies and Nielsen Media Research escalated last week when the 4A’s filed a “confidential inquiry” asking the Federal Trade Commission to investigate “whether Nielsen was engaged in any uncompetitive business practice,” said Adonis Hoffman, 4A’s svp and legal counsel in Washington, D.C.

The FTC withheld comment. Donna Campbell, vp of the 4A’s media services division in New York, said agencies have complained for “close to 10 years” about “what could be viewed by the FTC as extreme monopolistic practices,” including “300-500 percent rate increases over the last couple of years.”

Nielsen, which is owned by Adweek parent VNU, is also accused of using proprietary information from third-party data processors that provide services such as “fusion” analyses for agencies that licence data owned by Nielsen.

Jack Loftus, svp of communications at Nielsen in New York, said “all of the major third-party processors” have signed contracts or have agreements with Nielsen and that fees are a “nonissue.”

Stanley Federman, CEO of Telmar, a media-software provider with operations in 85 countries, said, “We’re still talking, but we haven’t signed anything. … I’m hoping signing dates can be postponed until all matters are resolved.”

In response to the 4A’s action, Nielsen sent a letter to its clients Sept. 19 explaining how it was addressing misgivings that arose out of its February 2003 business policy for third-party processors and complaints fielded at a July 29 4A’s research committee meeting. Concerning its access to proprietary data, Nielsen offered to allow a neutral auditor to go between Nielsen and processors. Loftus said no processor has yet exercised the option. “Agencies want control of the data,” he said, “because there are things you could do with it if you owned it outright. … These agreements are no different than the old agreements.”