Paramount Demanding ‘Nearly 50%’ Price Reduction

Nielsen CEO Karthik Rao has weighed in on the ratings measurement firm’s ongoing contract dispute with Paramount Global, pushing back against the media giant’s claim that it is seeking “substantial price increases” in negotiations.

“We are simply aiming to maintain fair value for the quality of our services—services that are empirically better than at any point in our history. Our proposal to Paramount is eminently reasonable and commensurate with the value our services deliver,” Rao said in a memo to clients obtained by TheWrap. “We’ve worked tirelessly to update our tools, refine measurement capabilities, and enhance your monetization options. These innovations are the result of significant investments over multiple years to build and also to maintain/enhance going forward. It’s hard work that we love doing, because it provides best-in-class, MRC-accredited solutions for our clients’ increasingly varied needs.” 

Rao said that Paramount is demanding a “nearly 50% reduction” in the price of its service, which “not only undervalues our substantial investments, but makes it unsustainable to provide the support and quality that all Nielsen clients rely upon.”

“We can not reset the value of our services to a fraction of their worth due to the circumstances and demands of one client,” he added. “We are an industry solution and price integrity matters for the role we play in the industry.” 

The current contract between Paramount and Nielsen expired on Oct. 1. In a memo to agencies ahead of the expiration, Paramount Advertising president John Halley argued that Nielsen’s costs as a percentage of Paramount’s ad revenue have “quintupled” over significant parts of its business, and proposed fees exceed the total ad revenue of the network being measured in some instances.