ARCHIVED - Broadcasting Commission Letter addressed to Jani Yates (Institute of Communication Agencies)
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Ottawa, 25 March 2015
Our reference: 700515
By email
Jani Yates
President
Institute of Communication Agencies
2033 Yonge St., Suite 3002
Toronto, Ontario M4P 1E4
jyates@icacanada.ca
Re: Simultaneous substitution decision
Dear Ms. Yates,
This is in response to your correspondence wherein you indicated your concern with the Commission's decision eliminating simultaneous substitution during the Super Bowl.
I note that I could not find any evidence of your agency’s participation in the open and transparent Let’s Talk TV process. The Commission would have benefitted from your participation at the public hearing.
I note that the decision in question was reached following an extensive public proceeding that examined many options with respect to simultaneous substitution including its elimination during live events or its complete elimination. The Commission heard from many stakeholders including advertisers, who are an important component of, and contributor to, the broadcasting system.
The Commission did hear testimony during the proceeding regarding the value and importance of simultaneous substitution to broadcasting undertakings, program producers and actors, and advertisers. For the most part, the Commission chose to maintain the simultaneous substitution regime, despite it being a major exception to the fundamental rule that broadcasting distribution undertakings, as common carriers, should not alter the content of a programming service.
It also heard, however, many Canadians express their frustrations triggered by improperly executed substitutions that caused them to miss portions of programs. The broadcasters acknowledged these difficulties and indicated a willingness to address these issues by way of a working group. Canadians also complained of missing the American ads during the Super Bowl, which they consider to be an integral part of the event.
I note that in a study submitted by Armstrong Consulting for the Let’s Talk TV proceeding entitled, The Economic Value of Simultaneous Signal Substitution for English-Language Private Television Broadcasters, it is estimated that for the 2012/2013 broadcasting year, simultaneous substitution accounted for 9.7 million average weekly viewing hours. Therefore, the Super Bowl, which is 3 hours long, represents an extremely small fraction of the total amount of opportunities for advertising on television in Canada.
While you may consider the Super Bowl to be one of the more valuable advertising opportunities, our analysis of the 2014 Super Bowl commercials indicates that only 71.5% of the available advertising minutes were purchased for that purpose. Further, while simultaneous substitution of the Super Bowl will no longer be permitted as of 2017, advertising opportunities will continue to exist for Canadian advertisers on the Super Bowl where a Canadian television station broadcasts the event. One hundred percent of the ads on Canadian networks will continue to be ads sold by the Canadian network.
Moreover, as the total number of substituted viewing hours suggest, there will continue to be numerous opportunities for advertising on other programming and popular live events such as the CFL Grey Cup, NHL playoffs and various awards shows. In this light, the elimination of simultaneous substitution for one event is unlikely to significantly affect advertisers in Canada.
Competition for consumers’ viewing attention in an age of abundance is not just a reality for content producers, but also for advertisers. We have world-class Canadian talent – let’s challenge that talent to create better quality content and advertising. If your clients advertising is world class, there is no doubt that Canadians will tune to the Canadian broadcast of the Super Bowl and other events.
The Commission considered all of the evidence and submissions put before it, in the public proceeding mentioned above. The decisions taken represent a balanced approach to addressing all issues and views presented.
Sincerely,
Scott Hutton
Executive director, Broadcasting
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