"Privatization of radio and TV research harbors dangers"

When problems with the new TV measurement system arose last year and a legal dispute blocked the industry, the President of the Foundation was suddenly called upon to act as crisis manager. In the meantime, however, the industry is considering the organizational consequences of last year's crisis. Even parliament is currently discussing this - as part of the RTVG revision. De Stoppani himself wants one thing above all: Mediapulse should become more crisis-resistant. Reason enough to ask him about the restructuring plans.

WW: Mr. de Stoppani, you have announced that you will be stepping down at the end of the year. Why?
Marco de Stoppani: I think when you reach the age of 70, it's time to hand over your mandates. I was with Mediapulse for almost eight years.

You set up Mediapulse and had a difficult year last year due to problems with TV research. Did you get to know the industry in a new way?
The first six years were constructive and quite harmonious. But in the last year there were tensions, including on the Board of Directors (BoD). The experience of having to manage the BoD in a tight and consensus-oriented manner was new to me. I think I largely succeeded.

And on a human level?
I was surprised that the ability to set aside their own particular interests in favor of the whole was not very pronounced among some of the players.

What did you learn from last year's problems?
A lot. For example, that we underestimated the industry's inflated expectations. They had hoped for better usage figures from the new TV system, which measures in a broader and more differentiated way, which did not happen. We also deliberately chose a very short transition period from the old to the new TV measurement system. That was a bold move. Thirdly, when tensions flared up in March 2013, we didn't take a clear enough stance on the accusations. And fourthly, we didn't think it was possible for a single market participant to block an entire industry for months using legal means.

Radio research is also on the verge of renewal. What specifically are you doing differently from television?
Even before a new measurement system is evaluated, we involve the radio industry as much as possible - not only the broadcasters, marketers and advertising clients, but now also the advertising and media agencies. A second conference was recently held at which we will inform the industry not only about the list of requirements for the new research, but also about the available measurement systems - together with the respective providers. We are also planning a longer test and transition phase - in the knowledge that there will then be two currencies on the market, which can also be problematic.

And who will decide?
This is the crux of the matter: although the industry players want to be involved in decision-making, they do not bear any entrepreneurial responsibility; this lies with the BoD. The decision-making authority therefore remains with the BoD. However, we want to involve the industry more closely in the run-up.

When Mediapulse discovered at the beginning of 2013 that there were problems with the allocation of the new measurement data, it issued a communiqué. Shouldn't you and CEO Manuel Dähler have stood up and explained sooner?
Perhaps. However, there was one problem: the Chairman of a Joint Industry Committee (JIC), such as Mediapulse, primarily represents the opinion of the BoD, in which the most important stakeholders in the industry are represented. However, the BoD already had differing opinions on the data collected at the time. It was therefore virtually impossible to reach a common opinion at that time.

There is talk in the industry that although Mediapulse is communicating more actively, it is still not transparent enough. Is this to do with Kantar's business secrets?
Over the last twelve months, we have put all the documents relating to the chosen system on the table and explained the details of the usage research in many places. But the fact is that it is based on algorithms that Kantar does not want to simply disclose for competitive reasons, which I understand.

At your press conference in February 2013, you said that you would clarify the "question of guilt" for the allocation error later. Has that now happened?
Yes, we made this analysis in the BoD: ultimately, we did not exercise our supervisory function enough in the detailed implementation. Kantar, in turn, should have given us more access at an operational level. Today, the collaboration is more intensive and closer. And after negotiations, Kantar has taken on some of the additional costs. It is also important to note that when we recognized the inconsistencies in data collection and allocation at the beginning of 2013, we optimized some things, but the algorithm, the devices and the panel - with the exception of PC-only households - remained unchanged.

At the same press conference, you responded to the question of whether you believe that the data is now correct following the error correction: "Based on the statements and the quality of the people responsible, I say yes." You were proved right. However, you were putting yourself before your staff, Manuel Dähler and Kantar, even before the expert reports were available. What made this statement possible?
Every Chairman of the Board of Directors must rely on people who have the necessary know-how. In all my years at Mediapulse, I have come to know and appreciate the quality of our employees, especially that of Manuel Dähler, whom I still support 100% today. He is one of the outstanding experts in Switzerland when it comes to media usage research. That's why I was able to make this statement with a clear conscience.

Were there any claims for damages?
No, we never had any.

Has Mediapulse itself offered compensation?
No. But because small broadcasters can only use the usage data to a limited extent in their day-to-day business due to the high variability, which was already the case with the old measurement system, the BoD has now made them a new price offer. We hope that this will bring them back to Mediapulse's TV research.

Have there been any changes to the contracts?
We have thoroughly revised the contracts with SRG and Goldbach Media; they are about to be concluded. They also contain new general terms and conditions that will soon apply to the entire industry. They now also include a dispute resolution procedure.

So that in future one individual can no longer paralyze the entire industry?
Of course, legal recourse remains open to everyone. However, disputes with companies with which we have contracts must now first be settled in arbitration proceedings. It is more difficult where we have no direct contracts, e.g. with broadcasters who are represented by marketers. We are still looking for a solution here.

In terms of client structure, Mediapulse has a cluster risk: in 2007, SRG payments accounted for 71% of revenues. What is the situation today?
I don't disclose figures, but the situation is more balanced than it used to be. This is because Goldbach now has more stations under contract, which is why its share of Mediapulse sales has increased. SRG and Goldbach together account for over 90% of our TV sales. As a result, there is still a clear dominance of these major clients. This can hardly be avoided in the local TV landscape.

Mediapulse is currently also a topic in politics: in February, the Federal Office of Communications (Bakom) invited the industry to Biel for a debate on future TV and radio research. I understand that there are plans to privatize research.
As far as I could gather, Bakom can imagine privatizing research in the longer term. The consequences of such a radical system change are still completely unclear.

You have made some basic considerations. Which ones?
I see four models. The first is a total nationalization of radio and TV research: the state defines the mandate, carries out the research itself and also finances it - and the market participants receive the data free of charge. The second model is privatization: the state withdraws from research and the industry organizes and finances it itself. There are two hybrid forms in between. In the first, the state defines and finances the task, but has it carried out by a third party who could also provide the data free of charge. And the fourth is the current situation: the state formulates the mandate, commissions the foundation, which may only charge prices that cover costs for the data. And it makes a limited contribution to financing the mandate. In concrete terms: with a cost of around CHF 20 million, the federal government pays CHF 2.5 million for developments and investments; the rest comes from the market.

The current situation can be explained by history: SRG used to be responsible for research. To make it independent, the foundation was created and regulated in the RTVA. However, all other media conduct research at their own expense and without a legal mandate. So Bakom is right: today's regulation is an old tangle.
Not quite. As a liberal-minded person, I would have to be in favour of privatization. But such a radical change also harbors dangers.

Which ones?
Firstly, no other industry has such a strong bipolar structure as the radio and TV sector - which is why the state has a stabilizing effect, especially in crisis situations such as last year. If you privatize, the laws of the market prevail: Goldbach and SRG would determine how and what is measured, and small providers could be disadvantaged. I also believe that these broadcasters and advertisers would hardly be able to agree on targets, requirements or measurement methods without a legal framework. Finally, Mediapulse is currently researching both the use of advertising blocks (advertising media research) and the general use of TV as a medium. In the event of privatization, the latter would probably cease to exist. SRG, which is most interested in this for programming, would then have to organize this separately, which would lead to different currencies. As you can see, the state has an organizing power for us.

Was this also the basic tenor in Biel?
Yes, the majority of the representatives of associations and individual companies present were positive about the role of the state.

So you are arguing in favor of retaining the existing model?
Yes, at least for the next phase. However, with changes at a normative level: the mandate should be interpreted more flexibly. Changes are also necessary at the organizational and management level: the foundation should be retained and the Board of Trustees should remain a reflection of the industry. At Mediapulse AG and Publica Data AG, both wholly owned subsidiaries of the foundation, the composition of the boards of directors should be more flexible.

Parliament is also currently discussing this as part of the revision of the RTVA. Until now, SRG and the other broadcasters had to be equally represented on the boards of directors. The Federal Council proposed abolishing this regulation. But why?
As I said, Mediapulse is organized as a JIC and is therefore geared towards balancing interests. However, in crisis situations such as last year, in which tight operational management is necessary, this model is not ideal, because in extreme cases it leads to an inhibition of operational decision-making processes.

Today, the Board of Trustees consists of 19 people and the Boards of Directors of the subsidiaries each consist of 7 people. All members of the Board of Directors are also on the Foundation Board. In addition, some of these people are also on the User Commission, which represents the interests of the industry. So there is no separation of powers. Is that also the issue?
Yes, from a corporate governance perspective, supervisory, executive and advisory functions must be separated. The Board of Trustees must supervise the work of the BoD, which is why a member of the Board of Trustees should not be on the BoD at the same time. The existing regulations also stipulate that SRG, the private sector and the advertising industry can each have two representatives on the Board of Directors. However, the Board of Trustees should have the option of electing external experts, including international experts, to the Board of Directors.

SRG, advertising clients and Goldbach are now represented on all three committees. Should it stay that way?
It will not be possible to separate them completely because there is a lack of suitable people. And you have to be realistic: a Board of Directors without representatives from Goldbach and SRG is hardly effective. I am thinking more of supplementing this body with independent personalities.

The User Commission (UC) is not regulated by law or ordinance. Nevertheless, is a personal union with foundation or administrative boards compatible here?
Although separation would be necessary, it cannot be completely avoided here either.

Should everything stay the same here?
No, we are discussing the idea of forming two committees: a rather small technical committee to deal with survey methods, socio-demographic issues and technological elements, and a UC to organize and weight the interests of the industry. It remains to be seen whether these committees should have a purely advisory function, the right to submit proposals or even decision-making powers. In my opinion, the latter should remain with the BoD.

The outcome of the parliamentary discussion is open. But what would be the worst case scenario from Mediapulse's point of view?
(studies for a long time) Maintaining the status quo. Because that would lead to a stagnation. Last year, the current system reached its limits. There is a need for action.

You said that the mandate should also be formulated more flexibly. According to the RTVA, Mediapulse must be independent and committed to science, and provide data for small broadcasters "in comparable quality" to that of large broadcasters. What should be changed?
Here are just three examples: If "comparable quality" were replaced by "fit-for-purpose quality", this would come closer to reality - and the corset would be less tight. Secondly, today the Foundation can only transfer its activities to subsidiaries that it "controls". This hinders institutional cooperation with other research organizations in the field of intermedia research. I would therefore welcome the removal of this restriction. A third point: the foundation currently receives money from the federal government for investments and developments. I would find it helpful if it could also finance the operation of the panel.

The Federal Council's proposal makes no mention of alternative models, the separation of powers or the User Commission. In this respect, the ball is therefore in the court of Mediapulse and the industry.
Yes, the Foundation Board and Board of Directors will probably - hopefully - deal with these issues conclusively in the summer.

The Federal Council also said nothing about the mandate.
We will therefore have to reach an agreement with the supervisory authority on the interpretation of the legal text.

Will all this last until the end of the year?
That is my firm intention and also DETEC's mandate: my successor should find a situation that is as orderly as possible.

A lot is still open. Nevertheless, how satisfied are you with the company that you will soon be leaving?
Last year, Mediapulse succeeded in collecting usage data daily and without interruption from mid-February onwards. This required a huge effort, for which all employees deserve credit. The situation has calmed down in the meantime, but we are still facing major challenges. That's why I won't be able to say whether I'm satisfied or not until the fall.

Interview: Markus Knöpfli