Since 1950, media research company Nielsen has been the scorekeeper for the TV business. Networks depend on its audience measurement data as they compete for $65 billion spent annually on advertising. 

The relationship has at times been rocky. Whenever TV networks saw significant changes in the ratings — often caused by emerging technologies such as the growth of cable and DVR usage — their reactions toward Nielsen could rival tennis legend John McEnroe's court rants at a major tournament.

Tensions rose to a new level after networks saw television viewing drop during the COVID-19 pandemic, when most Americans spent much of 2020 indoors.

Network executives believe the New York City-based company undercounted its audiences.

Nielsen relies on 40,000 homes nationwide that agree to have measurement equipment installed in their households to track their viewing habits. Nielsen uses the information from the so-called panel of homes to tabulate local and national TV ratings. However, the COVID-19 pandemic limited Nielsen's ability to maintain that number, and media companies say they have lost millions in ad revenue as a result.

The anger has led several major Nielsen customers, including NBCUniversal and ViacomCBS, to consider competing services.

David Kenny, 60, the chief executive of Nielsen, is on the firing line and will have to prove to clients his company is evolving with the times. He cautions that building a viable competitor that would be trusted by ad sellers and buyers is not so easy. Kenny, who has led Nielsen since 2018, recently spoke to the Los Angeles Times about the challenges ahead.

Q: There have been a lot of dust-ups between media companies and Nielsen. But they've never been more upset than they were this past year. What happened?

A: At the beginning of the pandemic, it was very clear that governments were not going to allow us to visit Nielsen panelist homes face to face, which did affect setting up new ones and it affected maintenance. And we did everything we could from outside the home, from driveways, to continue to maintain things. And I would say, in the early days, the data looked pretty solid.

I think at the beginning of the pandemic, we did not expect it to last as long as it did. So over time, there was a cumulative effect. I'd say by September-October (2020) we began to see some warning signals. We certainly communicated those (to clients), but we weren't in the position to calculate exactly what would be different (other than) just to say, "It is different because it's the pandemic." And that was dissatisfying. And we said as soon as we get vaccinated, we'll go back and recheck those homes. That is what we did — we checked them in March and April of 2021. The peak of the (flawed data) was in February. How off was it? The answer was around 2%.

Q: Some clients think the company was not forthcoming enough about the problem.

A: I don't think we were trying to hide it. I was just trying to be transparent all along. To try to estimate the impact I think could've been a worse answer.

Q: But did alarm bells go off when everyone had to stay at home in the spring of 2020, and then television viewing went down? Did you scratch your head when you saw that?

A: Of course there were alarm bells, but we never recorded television going down. The fact is, streaming was going up. There was a change in behavior. There was a growing number of these streaming platforms, which we also were (measuring). People were consuming other forms of media. Podcasting also went up. YouTube also went up. So I think all in, we did not show a decline in hours spent with media, or even hours spent with video. I think the legacy television players would've liked the additional viewing to come to them, but it's not what happened given what they were doing with programming, given the lack of sports. There were a lot of factors that happened in the pandemic and they continue to happen today.

Q: According to Nielsen data, streaming now accounts for 37% of all viewing for adults under age 55. It has disrupted TV viewing in a way that really no other shift in the media landscape has before. Do you think that networks are taking that out on Nielsen?

A: Totally. There have been angry spats for 30 years when there's a major transition in the technology. And this is the biggest transition. So the other thing to remember is on Dec. 6, 2020, we did communicate that we were moving to time spent (viewing) and combine streaming and linear measurement. The audience was not seeing a difference, whether she watched that program on a smart TV through an app, streamed or recorded on her DVR, or live. So we believe the most accurate measure is to measure total time spent. And that is a big change for people who have relied on a schedule as their way to get a premium audience.