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Nielsen Challenger Clears First Hurdle
erinMedia's antitrust lawsuit against Nielsen Media Research is set to proceed to trial, after a US District Federal Court ruled yesterday against Nielsen's attempt to dismiss the suit. The judge deemed erinMedia a viable potential competitor, whose business could be at risk, but dismissed co-plaintiff ReacTV.
erinMedia's complaint alleges that Nielsen has effectively blocked its attempts to compete in the TV ratings business due to 'anticompetitive conduct, which impedes innovation and harms consumers'. The court decided that such claims are protected by federal and state antitrust regulations.
Importantly, it also ruled that erinMedia is a viable potential competitor in the TV ratings market, and that, if its allegations are true, it 'is the target against which anticompetitive activity is directed'.
Disagreeing with Nielsen's argument that erinMedia plans to collect data from only a 'fraction of the national market', the judge noted that it is proposing to collect information from cable systems, which represent about 60% of the US TV population. Nielsen's ratings, by contrast, are currently based on data from about 8,000 households. 'Therefore,' concluded the judge, 'as pled, Defendant [Nielsen] is the company collecting data from a fraction of the relevant market.'
The court dismissed co-plaintiff ReacTV on the grounds that its alleged injuries are 'an unintended consequence of Defendant's alleged anticompetitive conduct'. As a result, erinMedia will be the sole plaintiff.
Both ReacTV and erinMedia are owned by Florida real estate billionaire Frank Maggio, who described the ruling as a 'clear and undisputable victory for erinMedia, and ultimately for the TV industry and the American people'.
The companies' web sites are at www.nielsenmediaresearch.com and www.erinmedia.net.
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