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NFL, teammates want to tackle Canada's new policy on Super Bowl ads

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December 08, 2016 - 7:00 AM

WASHINGTON - Some big players are attempting to tackle Canada's new policy on Super Bowl ads, with the National Football League, the U.S. government, Canadian broadcasters and advertisers and politically connected Washington actors rushing to take it down.

Their target: The unfiltered broadcast of U.S. ads.

The unusual coalition brings together groups with a financial interest in having Canadians watch ads that are paid for in Canada, worked on by Canadian creators, designed for Canadian customers, all helping a Canadian network recoup what it paid the NFL for national broadcast rights.

The league has sent a letter of complaint to Canada's ambassador to the U.S., David MacNaughton, enlisted a high-profile lobby firm and received help from the U.S. Department of Commerce, which has also written to two Canadian departments.

They're pressing the Canadian government to intervene quickly and get the Canadian Radio-television and Telecommunications Commission to abandon the new policy in time for the biggest advertising day of the year: Super Bowl Sunday, Feb. 5.

It all started last year when the regulator responded to a perennial gripe from Canadians: the one about enduring sub-par, made-in-Canada ads every year while American viewers were treated to big-budget productions sometimes more memorable than the game itself.

In early 2015, the CRTC announced the U.S. feed would be broadcast in Canada, without alteration. It's now getting pushback from various parties who stand to lose money: the league, CTV, and Canadian advertisers could forgo millions as a result, and CTV's owner, Bell Media, is also fighting the move in court.

Now the U.S. government is getting involved.

"I hope that this issue can be resolved in a way that reflects and honours the benefits of the ongoing trade relationship between our two countries," said one of the letters sent last month, from the U.S. Department of Commerce's Ken Hyatt to Canada's deputy ministers of trade and heritage.

That letter was followed up by another one a few days later. The NFL's Canadian managing director, David Thomson, told MacNaughton: "Given the urgency of the issue, I am also available to meet by person or by phone."

They argue against the policy on several grounds:

— That Canadian ad-creators are being frozen out of the most lucrative broadcast day of the year.

— That some of the products in the ads aren't sold in Canada, might not be relevant in the case of things like health insurance, and could even be illegal, in the case of pharmaceutical ads which are banned in Canada.

— The league has sold its broadcast rights to non-U.S. partners based on certain conditions, and killing their revenue stream undoes the business model.

— The Canadian broadcasting industry, which already faces historic struggles, can't afford the multimillion-dollar revenue loss.

In its deliberations, the CRTC heard an estimate from CTV that revenues from the so-called simultaneous substitution of live foreign events amounts to Cdn$40 million, or nearly one-third of all its revenues from simultaneous substitution.

A large percentage of that revenue comes from the Super Bowl; CTV reportedly charged between $170,000 and $200,000 for a 30-second spot during football's championship game last year, which was watched by nine million Canadians.

The broadcast regulator was weighing whether to end simultaneous substitution for all events — but, in the end, it decided the policy would apply only to Super Bowl.

The NFL calls that unfair too.

In its letter to the ambassador in Washington it called the policy "arbitrary," and "without proper notice, comment, or evaluation."

In response, the CRTC noted that the issue is before the courts.

Yet it said it would see a spike in complaints every year around Super Bowl time, from Canadians annoyed about missing the original ads — and the complainants would often unfairly blame the CRTC.

"Ads during the Super Bowl get a lot of hype," said an email from spokeswoman Patricia Valladao.

"They are an important part of the overall spectacle, and viewers look forward to watching them. For Canadian viewers this has been a problem. They don't see the same ads as those seen in the U.S. because they are replaced with Canadian ads. We heard Canadians."

The issue is before the Federal Court of Appeal — it's unlikely to be resolved in time for Super Bowl Sunday, prompting the sudden rush from the league and its allies to get the policy overturned quickly.

News from © The Canadian Press, 2016
The Canadian Press

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