The A.C. Nielsen Company provides most television audience research.

Ratings are compiled by a methodology called sampling.

Diaries and a device called a People Meter are used to compile data. All ratings are estimates, with a statistically computable margin of error.

Nielsen provides metered overnight research for the national networks. The top Designated Market Areas (DMAs, a/k/a TV markets) in the country also receive daily information from meters. Small markets receive weekly reports on household viewership, and detailed data on audience composition (compiled from diaries) during the key ratings Sweeps periods: February, May, July, and November.

Nielsen also provides separate services for syndicated and cable programming. The TV universe in the U.S. is presently about 115 million households.
 
 

A program’s RATING is the percentage of a universe which is watching the show. The universe includes all in a particular demographic, even those those with the set off.

A program’s SHARE is the percentage based only those with the set on.

Let’s say the universe being considered is 114.9 million U.S. households. Say 40% have the set off, and 20% have someone inside watching (or recording, or sleeping through) a program. That show would have a 20.0 household rating (20% of all homes) and a 33 share (33 % of the homes with the set on.) A 20.0 rating and 33 share is usually expressed 20.0/33.

In addition to national households, you can measure ratings and shares against other universes, such as a local market, a particular demographic, and combinations of these.  New measurements also consider the viewership of commercials, and video recording within several intervals from same day through one week later.

Advertisers target particular demographics (audience composition by audience by age, sex, income, etc.)

A show with a higher household rating is less desirable to advertisers than a program fewer households, but a large concentration of desirable viewers.

Performance in the target demographic (adults 18-49 for several -- but not all -- of the major networks and their advertisers) is the measure of success for programs today. Household ratings are a very poor and irrelevant measurement, because they equate an 89-year old living alone with a young family of four.
 

uConsider comparisons with LEAD-IN

uConsider (all)COMPETITION (and lead-in competition)

uTIMESLOT HISTORY (vs. PREVIOUS WEEKS or YEARS)
 

These are the factors to consider first. There are other considerations as well:

Is the program first-run or rerun?

Was there stunt casting or unusual content in the show or its competition?

Was an unusual amount of promotion a factor?

What are the usual HUT LEVELS for the timeslot and season?

AFFILIATE CLEARANCES: What is the coverage rate? Any significant local pre-emptions? What is the strength of the network's affiliate line-up this year (dial positions, strength of local programming, etc.)?

Once all of the other variables have been weighted, ask yourself if something truly unusual is going on:

Is the audience sending us a new message here?
 

Micro-trends and macro trends can be spotted by careful analysis of ratings. A micro-trend might be that in small markets, a particular new game show is always increasing its lead-in. This is how the King Brothers spotted Wheel of Fortune and became billionaires.

A macro-trend can be so important that its magnitude renders irrelevant the daily competition for ratings between networks.

Such a macro-trend has been the fragmentation of the television audience, over the last 25 years. The broadcast networks have seen their audience steadily erode, due to more viewing choices. Spotting a macro-trend requires looking at "big picture" numbers:

Number of non-broadcast national networks
1974: 4
1984: 49
1992: 78
2000's: over 300

% of homes with cable:
1972: 10.5%
1982: 35.0 %
1992: 61.5%
2005: 66.8%; and 25% have direct satellite

The growth of satellite delivered "basic" and "pay" networks has been a case of the tortoise and the hare. Even today, most basic networks usually score lowly shares, 1's, 2's, and 3's. But in the aggregate, their combined numbers have devastated the broadcast competition.

As more people receive more channels, PENETRATION numbers shoot up for the smaller and medium-sized networks.

Perhaps the most interesting trends to study are audience realignments in terms of creative tastes.

Are traditional genres being revitalized? Are new ones being developed?

How long-standing is the trend toward non-fiction programs?

This type of analysis requires a combination of intuition for numbers, and for the creative content of programs.