With the Super Bowl only a few weeks away, an unusual coalition comprised of the National Football League, Bell Media, Canadian advertisers, and an actors’ union have launched a full lobbying blitz aimed at overturning a 2015 ruling that will allow Canadians to view both the U.S. and Canadian feeds of the game. The change addresses longstanding frustration with Canadians’ inability to view U.S. commercials during the Super Bowl, since simultaneous substitution policies dating back to the 1970s allow Canadian broadcasters to block U.S. signals and substitute their own feed and commercials.
My Globe and Mail opinion piece notes that the fight to block the U.S. feed has led to some unlikely arguments. CRTC critics who typically call on the regulator to get out of the way are now calling on it to impose the simultaneous substitution rules. Meanwhile, in an odd role reversal, the NFL is emphasizing the Canadian culture benefits of blocking its U.S. broadcast and ACTRA, which issued a press release calling the Super Bowl ruling balanced and protective of the public interest when it was first unveiled, is going to bat for Canadian coverage of a U.S. sporting event.
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The CRTC’s 2015 decision to ban simultaneous substitution from the Super Bowl broadcast starting in February 2017 has generated renewed criticism in recent days as the NFL, Bell, and the U.S. government launch a lobbying blitz against the decision that will take effect with this season’s game. The league, broadcaster and their supporters argue that the inability to block the U.S. feed will mean lost revenue for the Canadian broadcaster and presumably reduced licensing revenue in the future for the NFL as the Canadian rights may be viewed as less valuable.
Despite claims about damage to Canadian broadcasting, the ban on simultaneous substitution for the Super Bowl does not eliminate the ability of the Canadian broadcaster to air its own commercials. In fact, the use of simultaneous substitution for the Super Bowl is an outlier when compared to the broadcast of most other major sporting events in Canada. Whether the Stanley Cup finals, the World Series, the Olympics, or the World Cup, Canadians typically have access to both Canadian and U.S. feeds. Canadians often opt for the Canadian version, perhaps because they like the commentators or the Canadian-oriented coverage. No one suggests that Canadian access to the Stanley Cup finals on NBC or the World Series on Fox (Sportsnet uses the international feed and many commented this year that they preferred that version that included Buck Martinez on colour commentary) eradicates rights or eliminates the ability for a Canadian broadcaster to successfully air the same event.
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Kevin Crull, Bell Media’s President delivered a much-anticipated keynote speech at the Prime Time in Ottawa conference on Friday. Titled “The New Reality: Broadcasting in Canada”, Crull’s claim was that the new reality for broadcasting in Canada is unsustainable and requires massive regulatory change. While Crull argued that Bell doesn’t want protection (in fact, incredibly claimed that a company that has benefited from foreign investment restrictions, genre protection, and simultaneous substitution has never had protection), he proceeded to outline a series of radical reforms that would raise television fees, block access to U.S. channels, violate net neutrality rules, and make Netflix less attractive to consumers. Couched in terms of “level playing fields” and “secure rights markets”, the speech was fundamentally an admission that given the competitive challenges, Bell’s hope is for a regulatory overhaul.
The key slide within the presentation can be found here. Crull certainly spoke about creating great content, though on the previous day Bell executives cautioned against programs that are “too Canadian.” The major focus of Crull’s talk wasn’t on content creation – the overwhelming majority of Bell Media’s leading programs are licensed from U.S. broadcasters – but rather on proposed changes to the regulatory framework.
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Throughout the Canadian Radio-television and Telecommunications Commission TalkTV hearing, Canadian broadcasters such as Bell (CTV), Rogers (CITY), and Shaw (Global), tried to assure Canada’s regulator that they were ready to embrace the digital future and prepared for regulatory change. Yet in recent weeks, it has become increasingly apparent that Canadian broadcasters plan to fight change every step of the way.
The effort to keep core business models intact are sometimes obvious. For example, new services such as Shomi and CraveTV are often characterized as Netflix competitors, but given their linkage to a conventional cable or satellite television subscription, are a transparent attempt to persuade consumers to retain existing services and not cut the cord. The viability of those services remains to be seen, but more interesting are the regulatory and legal fights, where Canadian broadcasters are waging an ongoing battle against change.
Bell Media leads the way with the two legal challenges against recent CRTC decisions. Yesterday it asked the Federal Court of Appeal to overrule the CRTC on its decision to ban simultaneous substitution from Super Bowl broadcasts starting in 2017. The Bell motion for leave to appeal strikes me as weak:
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Last week’s CRTC decision to ban simultaneous substitution from the Super Bowl broadcast starting in 2017 has generated mounting criticism in recent days. While analysts initially noted that the lost revenue for Bell Media would not be material (a prediction borne out by a quarterly conference call where the decision was not raised by anyone), anger over the decision has continued to grow. Nothing compares with Kevin O’Leary, a Bell Media commentator, ranting against the decision on Bell-owned BNN as he repeatedly calls the CRTC “insane” and laments lost foreign investment into a sector that still has Canadian ownership requirements. However, with Bell seeking private meetings with CRTC Commissioners to discuss the decision and more serious critiques from CMPA’s Michael Hennessy and Cartt.ca’s Greg O’Brien, the decision has clearly left many unhappy.
If the critics are right, the CRTC decision is the “beginning of the end of the system”, erodes the value of rights, and will lead to job losses and less Canadian content. It is undoubtedly true that changes are coming to the Canadian broadcasting system, but this simsub decision is at best a small part of the reason. The post raises six points in response to the decision and the critics.
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