Apr 2, 2019

Media measurement stocks slide amid corporate drama

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Data: Yahoo! Finance; Chart: Axios Visuals

Comscore and Nielsen, two of the biggest providers of media measurement and analytics, have seen their stocks sink over the past week after separate reports of corporate drama.

The big picture: The media measurement market has gotten more complicated as the analog world reckons with digital, putting more pressure on companies to invest in innovation, which can be costly and controversial.

Nielsen stock was down roughly 10% Friday after the New York Post reported that private-equity giant Blackstone Group was bowing out of the bidding process.

  • Sources tell The Post that Nielsen's debt load was the reason Blackstone backed out of its bid.
  • Nielsen, which has been around for nearly 100 years, has struggled to keep its consumer insights business growing, since many of its biggest retail and packaged goods clients have slashed costs. As a result, it's reportedly been looking to sell for upwards of $10 billion.

Comscore stock was down roughly 30% after CEO Bryan Wiener and President Sarah Hofstetter — both of whom came to Comscore less than a year ago from media agency 360i — abruptly stepped down, citing irreconcilable differences with the company's board.

  • Comscore, which has taken on the role as the leader in digital measurement and Nielsen's biggest rival, has been plagued by corporate drama.

Between the lines: The media industry has been rooting for Comscore's success, in part to provide market competition to TV measurement rival Nielsen, which has been criticized for not having the market pressure to innovate fast.

  • But while Comscore has made gains in cross-platform measurement and won several local TV contracts, the company has been plagued with bad corporate drama every time it seems to make some progress.
  • The company gutted its board in 2017 following a series of executive departures and after being removed from the Nasdaq exchange for delayed submissions of financial documents.
  • It announced that it was under investigation by the Securities and Exchange Commission in 2018, after revealing that it overstated revenues by more than $127 million from 2013 to 2015.

Be smart: Sources say that the rift between Wiener and Hofstetter and the Comscore board were over what was best for the company versus what was safest.

  • Wiener had outlined a plan for several strategic investments last quarter in order to bring Comscore ahead of market rivals that the board thought were too costly given their goals to maximize short-term profits.

The bottom line: The ever-evolving nature of media is putting pressure on the companies that have made businesses out of measuring the media.

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Driving the news: The decision comes after federal appeals court ruled 2-1 on Tuesday in favor of an executive order by Republican Gov. Greg Abbott that prohibits abortions during the coronavirus outbreak.

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