By Matthew Chung and Val Maloney
“This isn’t a happy day for Canadian advertising.”
Nancy Surphlis, managing director, OMD Canada, summed up industry reaction this morning to the CRTC’s move to remove simsub from Canadian Super Bowl broadcasts, beginning with the 2017 game.
The CRTC announcement states that, starting in 2017, Canadian broadcasters will not be able to swap in Canadian commercials during the NFL championship game. Jean-Pierre Blais, chairman of the CRTC announced the decision, which is the latest to come from the regulator’s Let’s Talk TV hearing this fall, in a speech to the London Chamber of Commerce.
Last year’s Super Bowl broadcast on CTV and RDS drew 7.9 million viewers, its second-best ratings performance ever in Canada. It was bested only by 2012, which saw total average viewer numbers come in at 8.2 million.
According to CRTC numbers from 2013, out of a total of 458 complaints from Canadians on simsub, 100 were regarding the Super Bowl ad substitution.
The CRTC’s decision doesn’t state at what time during the overall Super Bowl coverage simsub must be dropped and U.S. ads allowed. The decision did say that the current Canadian broadcast partner, CTV, is allowed to waive simsub for next year’s 2016 broadcast, “if it considers that viewer and subscriber demand warrants such a measure.”
The announcement said the CRTC believes it has provided Bell Media with a “reasonable period to make adjustments” prior to the 2017 game. CTV and Bell Media signed a new multi-year deal with the NFL in Dec. 2013, the length of which has not been disclosed.
Though CTV wouldn’t confirm prices, industry estimates peg this year’s 30-second ads at about $168,000 per spot. Last year’s game had a total of 47 commercials during the approximately four-hour long game. Assuming the same amount of ads for 2015, that amounts to a total of about $7.8 million for Canadian advertisements on this year’s broadcast on CTV alone.
A statement from Bell Media expressed the company’s obvious disappointment with the decision, adding the government is damaging the future of Canadian television, and rewarding U.S. corporations.
“Sure viewers will get to watch Wells Fargo ads in the Super Bowl instead of RBC, or Target and Wal-Mart instead of Canadian Tire,” says the statement. “But those advertising dollars will go directly to American companies instead of Canadian content creators and broadcasters. Canadian companies will also have a diminished opportunity to market their products to Canadians watching U.S. ads for products they probably can’t buy. It’s a troubling approach for a Canadian regulator to take.”
During last fall’s CRTC hearing, the removal of simsub was repeatedly argued against by both broadcasters and media agencies, with Stuart Garvie, CCO, GroupM Canada, saying the elimination of simsub would cause a trickle-down effect of issues throughout the broadcast, media and advertising industries. Without the revenue generated through simsub, he said, Canadian broadcasters would no longer be able to afford to purchase costly sporting rights, putting national channels at a disadvantage.
Bob Reaume, the Association of Canadian Advertisers’ VP, policy and research, called the announcement “disappointing.” The ACA, along with the Canadian Media Directors’ Council (CMDC), had urged the CRTC to maintain simsub when it presented before the commission in the fall.
“At a time when advertisers in Canada have fewer opportunities to reach Canadian audiences, this decision takes a high-profile opportunity away from them,” Reaume says. “This is going to send viewers to the American affiliate that broadcasts the Super Bowl in future years, and those audiences are just not available to advertisers in Canada.
“We should be finding ways to make Canadian audiences available to advertisers in Canada, not the other way around,” he said.
Anne Myers, president, MediaVest Canada, says today’s decision doesn’t appear to take into account the changing viewing landscape, noting the majority of U.S. Super Bowl ads are online in advance of the event.
“The marketplace has changed so much that now most of the U.S. commercials are available online and even before the game,” she says. “If you look this week you will see great access on both sides of the border to all of the American commercials. We have no idea what the situation is going to be in two years, so making this decision so far in advance of this event, it seems a little bit premature.”
Shelley Smit, president, UM Canada, agreed, saying “it’s not clear why the CRTC needs to go to such lengths to expose Canadians to U.S. ads in the game.”
OMD Canada’s Surphlis echoed Garvie’s concerns.
“Live event viewing is where broadcasters are able to hold their numbers, and if we are giving that all back to the U.S., it’s going to have huge impact for broadcasters and for clients,” she says. “First it’s live TV, and then what will happen with the other content? So, when we go down and buy the content in L.A., will broadcasters be reluctant to purchase some of the big ticket programming in case the CRTC decides to change its mind again?
“I don’t think we will be able to look at programming and big eyeballs, it will all be fragmented even further,” she adds. “Clients look at these big tent-pole events as an opportunity to create water cooler talk. And now with this fragmentation I don’t know why Canadian broadcasters would buy the rights to air those programs.”
Why would Bell or any other broadcaster even consider broadcasting the game under such an absurd circumstance. The CRTC is reacting to issues that don’t really exist. The irony is that Canadian advertisers were starting to develop some unique advertising for the game. So the CRTC says, we’ll have to put a lid on that.” Go figure!
This is just another nail in the coffin of Canadian broadcasting. Isn’t there supposed to be a regulator in Canada to protect not only the consumer, but the industry as a whole? For the life of me, I cannot see the upside to this decision.
As mentioned in the article, people have access to the commercials on-line and will get their fix if they want it. And really, out of a viewing audience in 2013 of 7.9 million people, you received a whopping 100 complaints about ad substitution. Way to listen to the always vocal minority. Guaranteed those people have no idea what the impact of this decision will have on broadcast media in Canada going forward.
Let the Canadian brands have a shot at producing great creative to build loyalty with Canadian consumers. How and why would any Canadian Broadcaster EVER want to purchase the rights to broadcast big events like this if there is no revenue opportunities?
I guess in their logic it makes more sense to send us all to the American networks to view commercials for U.S. brands. What?
A ridiculous, and short-sighted decision on the part of the CRTC, with absolutely no advantage to consumers, or marketers in Canada.
Because it will still deliver millions of viewers and Bell Media and its communications dept LIVES for bragging rights, that’s why! It will still be one of the largest events on TV each year. Not everyone will…or wants…to watch the U.S. feed.
That is absolutely ridiculous! Just like “video killed the radio star”. Its all about the number of viewers, rankings, bragging rights, ad rates, etc. Just another reason for Kevin Crull and Phil “content is NOT” King to cry in their cereal. Do you know how much money these guys “throw” around each year? All it means is viewership decreases, CPMs increase and costs for the rights to the Super Bowl may increase. Its a drop in the bucket for Bell Media. They just invested untold millions in a Showtime deal. As is the $12 million they “lose” each year on local TV operations. They are well-known for “crying wolf” every time they don’t get their way.
“Let the Canadian brands have a shot at producing….” That’s funny because Bell Media Sales announced a contest for just that!…during the Super Bowl. It was a disaster. No one….or very few…Canadian advertisers wanted in!