For many Super Bowl fans, the commercials are almost as big a part of the event as the actual game, since companies spend so much money on them that they are often either really good or really terrible. In Canada, however, viewers have always been forced to watch Canadian commercials during the big game, which are inserted into the U.S. broadcast by the Canadian licensee for Super Bowl rights, a process called “simultaneous substitution.”
That could all change next year, however, thanks to a decision last year by the Canadian television regulator, the CRTC. The agency recently said that it is planning to stop Bell Canada—which owns the rights to the Super Bowl through its broadcast subsidiary CTV—from requiring that cable companies carrying the game substitute CTV’s commercials.
The decision isn’t quite law yet, because both Bell and the National Football League have appealed the ruling to Canada’s Federal Court of Appeal. Bell is understandably upset about losing out on the increased viewership its ads get with what the industry calls “sim sub.” And the NFL is presumably concerned that if sim sub is no longer allowed, it won’t be able to command as high a licensing free from Canadian broadcasters.
The Super Bowl is the most-watched program in Canada, bringing in more than 9 million Canadians on average last year, and the chance to advertise to those viewers generates a lot of revenue, just as it does in the U.S. In total, “sim sub” of Canadian commercials in U.S. broadcasts brings in over $250 million in revenue annually, and the Super Bowl is likely a significant chunk of that.
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The CRTC, meanwhile, seems to see this as an issue of fairness of access for Canadians—not to the game itself, but to the advertising. In a speech about the proposed rule change, CRTC head Jean-Pierre Blais said that “Canadians have told us loud and clear: Advertising is part of the spectacle associated with this event.” The regulator has put out a call for comment from Canadians about the decision in advance of this weekend’s game.
It’s not just Bell and the NFL that oppose this new plan. Prominent conservative columnist Terence Corcoran skewered the idea in a column he wrote after the CRTC announcement, in which he called the regulator obsolete and made fun of its decision to promote U.S. advertising over its Canadian counterpart. The Association of Canadian Advertisers also opposes the decision.
Corcoran said that the ruling “undermines Canadian advertisers, stripping them of the opportunity to reach millions of NFL fans in Canada,” and that it would “trash the contract rights of a Canadian broadcaster.”
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A senior Bell executive told the Financial Post that the CRTC decision is a mistake, and that it would affect not just large advertisers like Tim Horton’s but also small businesses that buy ads during the Super Bowl broadcast and rely on that income.
“Canadian companies will have a really diminished opportunity to market their products to Canadians who will be watching U.S. ads for products that they probably can’t even buy,” said Perry MacDonald, senior VP of English TV. “In a struggling economy, and with Super Bowl advertisements readily available online, it is a bizarre approach.”
