The South African Audience Research Foundation has received a formal letter of resignation from the National Association of Broadcasters, bad news for Saarf CEO Dr Paul Haupt who had hoped it might reconsider its position.
Up until Friday, the NAB had just verbalised its “intention” to resign from the 39-year-old research body but Saarf this week received a letter from executive director Nadia Bulbilia saying the NAB, which represents the television and radio industries, would serve out a year’s notice as of 1 January 2014.
The NAB’s decision stemmed from what it called the rejection by the Saarf Annual General Meeting of a NAB proposal to have “more equitable representation for television and radio broadcast media on the Saarf Board”. It said the proposal was first discussed with the Saarf Board on 6 May 2013 and then formally tabled on 24 May 2013, some five weeks prior to the AGM.
Saarf denied it was its board that refused the NAB proposal. CEO Paul Haupt said in a statement Saarf members asked the NAB for two weeks to “consult their constituencies and to evaluate other options before meeting again with the NAB to try and resolve the issue amicably and to get a consensus decision from all Saarf stakeholders”.
But the NAB has stood its ground, supported by the SABC and e.tv, and has made good on its threat to leave Saarf and start the process of finding a new way of measuring television and radio audiences.
It committed to honouring its funding agreements, but warned Saarf not to enter into any long-term contracts other than AMPS and RAMS agreements that end in December 2014, and the controversial TAMS, run by Nielsen on a month-to-month basis.
The TAMS agreement is of particular concern to the NAB, which said Saarf should not finalise any further agreement with Nielsen “until such time the NAB, Nielsen and Saarf have agreed a way forward”.
Saarf is embroiled in a crisis over its Television Audience Measurement Survey, recently taking steps to rectify the issues by commissioning an independent audit by French company, CESP. In the meantime, it is without a chair as Clare O’Neil resigned at the AGM. Haupt said Saarf would deal with the appointment of a chairman at its next board meeting, which will be held shortly.
Its members have much to think about, in light of the NAB move. The Marketing Association of South Africa, in its invitation to members to join it at a members funding forum tomorrow (Wednesday, 17 July), said the NAB withdrawal would impact on Saarf’s funding, already under pressure.
The NAB, it said, had told industry funding body, Mamca – comprising representatives of the marketing, broadcasting and media agencies – that it would cease making contributions as of the end of 2013. Industry funding of Saarf, and the Advertising Standards Authority, is 1% of advertising spend, which is paid to Mamca.
MASA says the NAB is not entitled to make “unilateral decisions regarding the payment of this fund”. It says the NAB’s decision to pull out of Saarf poses a threat to the “ongoing sustainability” of the organisation. The funding forum, it said, should discuss the issues thrown up by the NAB, and agree a way forward.
In the meantime, Saarf issued a detailed response on the crisis, reiterating its stance that it was NOT responsible for the NAB decision, saying it was “the media, marketing and advertising industries and their constituencies – and not the Saarf board that refused the NAB proposal for greater board-level representation of broadcast media.” This refusal was made with good reason.
“At no stage did the other SAARF stakeholders indicate that they were not prepared to consider the request with an open mind – in fact they stated the opposite more than once during the discussions.
“If the refusal of greater board representation is the main reason for the NAB’s intention to resign from SAARF, as stated in the SABC and e.tv’s media release of 26 June, then SAARF wants to make it clear that the door for negotiation is still open,” it said.
But NAB’s official resignation has put paid to that hope.
Saarf also referred to the CESP TAMS audit, and its results, saying the release by the free-to-air broacasters contained “a less-than-accurate interpretation of the audit findings”.
It pointed out that CESP said the “methodology of the South African Television Measurement System corresponds to the international best practices on both Establishment Survey and TAM Panel and that they are comparable to similar TAMS in other countries, but recommends certain improvements to both surveys”.
Saarf said context was needed, and understanding around the current state of the TAMS. It said around 2008, Saarf stakeholders realised that the TAMS service would “encounter serious challenges in the coming five to 10 years, due to the rapidly changing television environment; an urgent revision and modernisation of the current TAMS service was required”.
It said in 2009, Saarf, in conjunction with the television industry, started a new TAMS tender process that ended when Saarf conditionally awarded a seven-year contract to Nielsen on 22 April 2010, to commence on 1 April 2011. “The awarding of the contract was conditional on a suitable agreement being negotiated, and on the LCA’s (now MAMCA’s) approval of the funding,” it said.
Saarf and Nielsen immediately began planning for the implementation of the new agreement, but due to funding constraints, implementation could not take place as planned and was delayed until 2013.
“All these postponements delayed the planned improvements to TAMS which were part of the new contract. Saarf was forced to manage a situation that worsened year by year, all the while hoping that the funding issue would be resolved, and that the new TAMS contract would at last be implemented,” it said.
A key criticism by NAB members was that TAMS research failed to keep up with South Africa’s evolving demographic profile. Saarf says the under-sampling of the rural population was a decision made by the industry itself. “Both the SABC and e.tv were represented on the Saarf TAMS Council and the Saarf TAMS Tender Committee (13 of the 25 members were from the NAB) when the decision to under-sample rural areas were taken. They were thus fully aware of the implications of these decisions,” Saarf says.
Saarf says the rural population is under-sampled by 50%, since rural viewers tend to be more homogeneous in terms of their access to TV services and LSM status. “The majority of rural dwellers do not, for example, subscribe to satellite services and they watch a very limited number of channels. When rural areas are under-sampled by design, LSM 1-4 will automatically also be under-sampled, but this is corrected by the weighting, as the CESP audit confirmed.
“On the other hand,” it said, “viewers who have access to DStv are over-sampled since these viewers are heterogeneous and have access to a vast number of channels. This over-sample is necessary to reduce the margin of error, which is critical when analysing data by specific target groups and numerous channels.”
The rural under-sample, said Saarf, was addressed in the 2009 TAMS tender, and the new TAMS agreement, once implemented, will improve the current situation by reducing the amount of under-sampling.
Stakeholders have to work together in the countdown to the NAB’s full withdrawal from Saarf in December 2014. The NAB has committed to ensuring “all issues affected by our resignation are handled with integrity and professionalism and in the best interests of marketers and broadcasters alike”.
It will be interesting to hear just what the marketers think after their ‘funding forum’ discussions tomorrow.
Saarf’s full response to the NAB allegations can be read here.