Nielsen Ratings

Nielsen is the company that measures TV audience ratings in the US. It collects data in two different ways: "Local Measurement" and "National Measurement."

National Measurement: so-called "Nielsen People Meters" are distributed to a number of households. When the viewer activates this device, it stores data on what channel is being watched and who is watching it. This way Nielsen can gather demographic information, which is useful for determining what kind of advertisements are profitable to insert into each show's commercial break. This data is transmitted to Nielsen Media Research's Operation Center every night. Then, based on this data, the "fast national" ratings are released the next morning; whereas, the "final national" ratings are released in the afternoon.

Local Measurement: used for tracking specific markets. About 25,000 households participate in this sample. These households are given another type of device, which can measure what channel is being watched, but cannot gather demographic information. This information is also transmitted to Nielsen that releases the "metered market" ratings the next morning.

A third, but not so important way of determining ratings on an every day basis is the paper diary. Paper diaries are filled out by viewers during the sweeps weeks in November, February, May and July. Ratings during the sweeps weeks outline the advertising schedule of the networks for the next couple of months; therefore, these times of the year the networks try to air episodes that have famous stars and celebrities as guest stars.

These measurements are often criticized for not being accurate, since they are only based on a narrow proportion of society. Yet, all the networks and ad agencies rely on them, and fans usually blame false ratings for the cancellation of their favorite shows. In order to extend the size of the monitored groups, Nielsen included DVR playbacks into its ratings, which appear in the next morning's "fast ratings" as well. However, ad agencies and networks do not take DVR viewers into consideration, because they can skip commercials, which makes them insignificant from a financial point of view.

This is all we should know about tracking audience data. Now let's make some sense out of an actual rating that appears in newspapers and on websites:

7th Heaven (4.4/8, #9; 18-49: 2.7, #T4)

This is a rating for the show called 7th Heaven. The first number, 4.4, shows the percentage of television-equipped households that tuned in to watch the show. Overall, there are approximately 114.9 million of such households in America, which means that at least 5,055,600 watched the show the night before, since there are at least one person in every household.
The second number, 8, shows us the percentage of households that watched the show out of all the households that were watching television that night. This number will always be bigger than the first one, since there cannot be more TV-watching households than TV-equipped ones.

18-49 is the main target group of advertisers, that's why it's important to measure their numbers separately. In fact, if a show has bad ratings overall, but it does good among its targeted viewers (e.g. Gossip Girl), the network might keep it on the schedule. On the contrary, if a show has good ratings overall, but do not attract enough adults between 18 and 49 (e.g. Without a Trace), the network might cancel it. The 2.7 part means that 2.7% of all adults (18-49) watched the show. There are about 132 million adults who fall into that category right now, so the 2.7% viewership counts for 3,564,000 viewers who belong to the target audience.

#9 and #T4 mean the rank it has achieved compared to other shows' ratings that night. The "T" means "tie".

This is a Grey's Anatomy rating from this week:

Grey’s Anatomy (ABC, 21.00) 7.6/12, #1; 18-49: (3.7, #2)

As we can see, it does much better than 7th Heaven did back in the day. The fact that it starts at 21.00 is important because when networks decide on whether to keep a show for next season or cancel it, they count in a number of different factors apart from the numbers themselves: how many viewers does it have compared to another network's show at the same time; when does it air; how many viewers can it keep from the previous show's viewers.
As we can see, Grey's Anatomy fans do not have to fear, because it meets all the requirements. It has won its timeline (21.00); in fact, it has won the whole night (#1). It airs at primetime, which is Thursday 21.00 in America, and it won. Since it is in primetime, it doesn't have to keep the previous show's viewers. Actually, it has twice as much viewers as FlashForward, the preceding show does at 20.00; as a result, FlashForward fans have a lot to fear.

Even though Grey's Anatomy has won the day, it has a relatively small number of viewers. Its average 11-12 million viewers cannot be compared to Seinfeld's or Cheers's average audience. The reason for that, and for the 100 million viewer finale of M.A.S.H. is that the number of channels available has multiplied several times in the last two decades. Also, people's taste has changed with the variety of programs offered nowadays. In the last five years, American Idol has consecutively won the title of highest average rating. Although television is getting ready for the revolution, conservative, or maybe just sane people like me can find joy in surprising miracles like Friends' 50 million and The Sopranos' 12 million series finale audiences that keep us hoping for more intelligent and entertaining shows to come.