The CRTC’s Tom Pentefountas memorably sparred with several broadcast and new media executives during the Let’s Talk TV hearings last fall (his acid-tongued showdown with Netflix’s director of global public policy Corie Wright was particularly noteworthy) and the federal regulator’s vice-chairman was similarly candid when addressing the Future TV Advertising Forum last week.
Pentefountas told attendees that “a world of opportunity” is opening up for the advertising sector, and that the federal regulator is creating a “roadmap for the future” that is creating new opportunities.
The lawyer-turned-broadcast-regulator urged the advertising industry to embrace the opportunities afforded by technology, and defended the CRTC’s controversial decision to eliminate simultaneous substitution – or simbsub – from the Super Bowl beginning in 2017.
He said the ability to deliver addressable TV advertising – which offers far greater precision than the traditional scattershot approach – is “revolutionizing” the advertising industry.
He noted both Cogeco Cable and CHCH Hamilton are experimenting with addressable ad systems, and cited a study by Experian Marketing Services that found homes receiving addressable ads tuned out 38% less than homes receiving non-addressable ads and that there was 56% greater efficiency sending ads only to relevant groups.
He also referred to a recent white paper from Visible World, which matched 10 billion individual TV viewing records over 18 months, and found those that included ads targeted at individuals generated conversation rates 70% higher than overall campaign results.
“Addressable TV ads have far greater precision than traditional approaches,” said Pentefountas. “Because of their focus on particular consumer profiles, they can be directly targeted. And they provide immediate feedback from these audiences.”
Noting major media generated $12.3 billion worth of revenue in 2013, according to the Television Bureau of Canada, Pentefountas said “there’s clearly a lot of money – and opportunity – at stake.”
He said cross-platform advertising also provides the opportunity to make brands more recognizable, while providing an efficient and cost-effective way to reach audiences.
Pentefountas also provided a progress report on a working group established to explore a set-box box measurement system in Canada. The group is tasked with proposing technical standards, privacy protections and a governance structure, as well as determining how costs will be shared. The group is scheduled to deliver its preliminary report to the Commission by June 10.
“Such a system would give all distributors and programmers access to this data, it could improve the industry’s ability to provide Canadian viewers with the information they need to make informed choices,” he said.
The successful creation of a set-top box measurement system could also improve broadcasters’ ability to monetize previously unmeasured viewership, said Pentefountas. “The fragmentation of audiences and multiplication of platforms and windows need not be feared,” he said.
Acknowledging the widespread displeasure among industry groups including the Association of Canadian Advertisers and Television Bureau of Canada to eliminate simsub from Canadian Super Bowl telecasts beginning in 2017, Pentefountas cited a study by Armstrong Consulting which found simsub accounted for 9.7 million average weekly viewing hours in 2012-13.
“Clearly, the three hours spent broadcasting the Super Bowl represents a miniscule amount of the total opportunities for TV advertising in Canada,” said Pentefountas. “Given the huge number of substituted viewing hours, there will still be ample opportunities for advertising on programming and great Canadian events such as the CFL Grey Cup, NHL playoffs, the Tournament of Hearts and various awards shows.”
Pentefountas added that the evolution of program rights and viewing habits suggest it would be “unwise” for the advertising industry to rely on simsub. “The day will come when it will no longer be a useful or necessary tool to protect Canadian broadcast rights,” he said.
