Arthur Charles (A.C.) Nielsen established, and gave his name to, the world’s largest market-research organization and the principal U.S. television ratings system. After working as an engineer in the Chicago area, he used investments from former fraternity brothers to establish in 1923 a firm that reported surveys of the performance and production of industrial equipment. A decade later, during the Great Depression, the company was faced with a reduced level of manufacturing on which to study and report, so it launched the Nielsen Food and Drug Index. Begun in 1933 and 1934, these regular reports on the volume and price of packaged goods sales in a national sample of grocery stores and pharmacies became essential to the packaged goods industry. A.C. Nielsen Company became the preeminent U.S. market-research firm.

Because the Depression was also a period of rapid growth for radio, and radio advertising, Nielsen was encouraged to begin measuring radio audiences. In the spring of 1936, he attended a meeting of the Market Research Council in New York, at which the speaker was Robert Elder, an instructor from the Massachusetts Institute of Technology (MIT). Elder described the use of a mechanical recorder that could be attached to the tuning mechanism of a radio receiver, providing a continuous record of the stations to which the set was tuned. The device had been developed independently by Claude Robinson while a student at Columbia University and by Elder with Louis F. Woodruff at MIT. Nielsen quickly acquired the meters that had so far been produced, as well as patent rights and trademark registration for the Audimeter, as the device was known. The Nielsen Radio Index (NRI), a series of regular audience surveys conducted with the Audimeter, began in December 1942. The Audimeter became the principal form for measuring radio ratings when in March 1950 Nielsen bought rival C.E. Hooper’s radio and television ratings services.

In 1939 the A.C. Nielsen Company Ltd. had been organized in London. The internationalization of the company increased, especially after 1957 when A.C. Nielsen, Jr., became company president.

In 1963 Congressional hearings studying ratings and their influence upon programming in television focused considerable criticism upon the ratings industry and on the reliability of audience-measurement surveys. In that same year Nielsen had discontinued radio Audimeter reports because the increased number of radio stations on the dial made it difficult for the device to distinguish between them. As a stop-gap measure, the company began a diary survey method for radio measurement (Audiologs). Weaknesses in this method attracted unfavorable attention during the hearings. Nielsen Jr. shut down the Audiolog operation, designed what he considered a reliable radio-audience measurement system and attempted to market it to the radio industry. Finding much resistance, he never brought this service into use.

By 1963 Nielsen was out of the radio ratings business, preferring to concentrate on the relatively young national and local television-audience measurement services—the National Television Index (NTI) and the Nielsen Station Index (NSI), respectively.

In June 1980 A.C. Nielsen, Sr., died in Chicago. In 1984 his company merged with information giant Dunn and Bradstreet. The company has since been split into two entities, Nielsen Media Research and the A.C. Nielson Company; the first was acquired by the Dutch company VNU in 1999; VNU also acquired the second company in 2001.