Q 1.
Nielsen ratings are the audience measurement systems developed by Nielsen Media Research, in an effort to determine the audience size and composition of television programming in the United States. In the U.S., the term TV ratings immediately makes people think of Nielsen because Nielsen Media Research has become the de facto national measurement service for the television industry in the United States and Canada. Nielson measures the number of people watching television shows and makes its data available to the television and cable networks, advertisers and the media. This research is worth billions of dollars. Advertisers pay to air their commercials on TV programs using rates that are based on Nielsen's data. Programmers also use Nielsen's data to decide which shows to keep and which to cancel. Nielsen uses a technique called statistical sampling to rate the shows -- the same technique that pollsters use to predict the outcome of elections. Nielsen creates a sample audience and then counts how many in that audience view each program. Nielsen then extrapolates from the sample and estimates the number of viewers in the entire population watching the show.
Electronic metering technology is use for Nielsen ratings process. Two types of meters are used: set meters capture what channel is being tuned, while People Meters go a step further and gather information about who is watching in addition to the channel tuned. Nielson viewership data collection system provides many advantages: Nielsen Media Research provides statistics on specific demographics as advertising rates are influenced by such factors as age, gender, race, economic class, and area. Younger viewers are considered more attractive for many products, whereas in some cases older and wealthier audiences are desired, or female audiences are desired over males. By having access that this kind of data helps advertisers to choose where to advertise according to their target audience.
Disadvantages of Nielsen system are since viewers are aware of being part of the Nielsen sample; it can lead to response bias in recording and viewing habits. Criticism of the measuring system itself is that it fails the most important criterion of a sample: it is not random in the statistical sense of the word. A small fraction of the population is selected and only those that actually accept are used as the sample size. In addition, the Nielsen ratings one TV per household three perhaps four network model encouraged a strong push for demographic measurements. This caused problems with multiple TV households or households where viewers would enter the simpler codes raising serious questions to the quality of the demographic data. A related criticism of the Nielsen ratings system is its lack of a system for measuring television audiences in environments outside the home, such as college dormitories, transport terminals, bars, jails, and other public places where television is frequently viewed, often by large numbers of people in a common setting. Nielson system cannot tell whether the audience is actually watching the television program or if their televisions are merely turned on. While Nielsen measures the viewership of programs, it does not measure the viewership of commercials, which is what the advertisers are interested in. Finally, because Nielsen measures in-home viewing, rather than out-of-home viewing, the ratings of shows that are watched in groups at locations such as bars, dorms, health clubs, etc. could be deflated. In addition to set meters, individual viewer reporting devices, such as people meters, have allowed the company to separate household viewing information into various demographic groups, but so far Nielsen has refused to change its distribution of data of ethnic groups into subgroups, which could give more targeted information to networks and advertisers.

The industry is still totally dependent on Nielsen numbers, because that's what the huge advertising market understands. Nielsen Media Research currently measures TV Audiences in 27 countries globally using people meter technology in more than 58,000 homes. Nielsen is the leading TV viewership tracking firm but competitors such as TNS Media Intelligence also offer second-by-second viewership data. In Canada, BBM Canada measures both TV and radio while its subsidiary BBM Analytics is one of several companies that provide software for analyzing the data. BBM Canada is using Personal Portable Meter (PPM) to determine television ratings. These devices, which listen for cues that broadcasters have embedded in their broadcasts, enable BBM to assess television viewing outside people homes which Nielson system can’t do. This allows advertisers to correlate the advertisements people hear with the products they buy. They can therefor determine how effective their advertisements are. Over here BBM has an edge over Nielsen system.