Monday, 19 November 2012

CMRI Responds to Nordicity

CMRI’s critique of Nordicity’s study dealing with the role of advertising on CBC has generated a reply from Nordicity.  Nordicity’s reply was picked up by at least one news outlet.    In its reply Nordicity was very selective about the facts and made false statements about CMRI’s analysis. 

Nordicity’s reply to the CMRI critique did not deal with most of the major issues raised by CMRI:  the assumptions made about the cost of replacing ads, the claim that with as much as seven times the budget, CBC/Radio Canada’s audience share would possibly shrink to the levels of TVO/Tele-Quebec, etc. Instead Nordicity chose to deal with the following less important items.

Nordicity’s reply claimed that its report was not primarily about audiences: “Quite to the contrary, audience is a secondary concern of our analysis.  The primary concern is clearly stated in conclusion #4 on page 13:”  Here is that conclusion: “Conclusion #4: The PBS operating structure, revenue model, and program production financing could not be readily replicated in Canada.  If CBC/Radio Canada managed to do so, it would likely decline in audience terms to PBS’s niche presence in the market.” In its reply to CMRI Nordicity omitted to reproduce the second part of this conclusion, which seems ultimately to be all about audiences. The fact is that the word “audience” is mentioned over 30 times in the 27-page Nordicity report.

Nordicity’s reply claimed it did not confuse the term “rating” with audience “share:” “Your article implies we misled readers about PBS’s viewing level…In fact, we clearly state on page 13 of the report that PBS has a 1.3% rating:” This is a false statement: the word rating does not appear in the Nordicity report.  The word ratings does but is used in the generic sense. Putting aside the fact that the number 1.3% was two lines away from the word “ratings” in the actual report, Nordicity doesn’t mention that the sentence just prior to 1.3% read: “As a result, PBS now has a very limited audience share and impact on the U.S. market.”      

And, just what did Nordicity mean when it claimed PBS had a limited impact on the U.S. market?  If tonight the PBS news hour, a science program, an arts program and a drama were watched by different people and each program had a 1.3% rating, then the audience reach of PBS would be 5.2% (1.3%X4).  If this was repeated for the next week, the audience reach would be over 35%, which, assuming the programs were of high quality, would likely result in a very substantial impact on the market.     

Nordicity went on to compare PBS and CBC audiences: “In fact, CBC TV’s prime time audience share is double, which in audience terms is a very significant difference.”  CMRI originally pointed out that PBS has a very substantial following in Canada and it does so with no local stations, staff or infrastructure.  Hopefully CBC English TV with numerous stations and a large infrastructure, as well as about three quarters of a billion dollars in annual operating revenue, will draw a larger audience than PBS. 

Nordicity also took issue with our questioning Nordicity’s “estimate” of the cost of selling ads on CBC.  Nordicity put the cost of sales at about $25 million annually. CMRI pointed out that CRTC data showed that it was likely many times higher.  Nordicity in its reply said:  “In fact, we cited the CRTC as a source for our estimate in our report on page 16, Table 1.”  CRTC was mentioned along with four other sources for the table in question but Nordicity did not discuss the CRTC sales data at all. Moreover, why was Nordicity “estimating” the cost of CBC sales?  Why didn’t it just ask the CBC, its client?

Finally, Nordicity makes a blanket statement about CMRI’s competence: “In addition to these factual misrepresentations of our work, you make basic audience research errors and misrepresent your own survey data.” 

In its critique CMRI clearly referred to 10 years of data from its annual survey regarding attitudes toward TV advertising. Nordicity made the following false statement in its reply about CMRI’s annual survey: “Your survey cannot purport to state any facts about Canadians, since your survey is of “900 Anglophone respondents” and by definition excludes all francophone Canadians.”  In our analysis we usually only report Anglophone results and CMRI clearly stated: “The Media Trends Survey has been conducted for ten consecutive years and has surveyed over 15,000 Canadians in total in this period.”  Approximately 2,600 of those surveyed were Francophones, who responded to a separate French-language questionnaire in five of the last ten years.  Francophones have had almost identical feelings toward advertising but Nordicity falsely claimed we had no such data.

Nordicity’s reply to CMRI’s critique appears to be an attempt to deflect attention away from the major issues about advertising on CBC.  In our view Nordicity’s reply only casts further doubt on the validity of the original study about CBC and advertising. 

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