Blog

By ACA Staff

Advertisers need to be aware of plans by certain Canadian broadcasters to incorporate conventional, over-the-air (OTA) broadcast commercials on video-on-demand (VOD), potentially as soon as this fall, and how this may affect their business. These plans include running full commercial loads from many OTA telecasts in set top box VOD replays of their television content for a 7-day period immediately following the live broadcast and posting such audiences back to the original airing.

CBC and SRC have confirmed their plans to proceed with this direction. Other broadcasters may be considering the same, though the timing is not as immediate. But we are pleased to report Rogers Media, recognizing advertisers’ concerns, has decided not to proceed with this direction.

In addition to removing advertisers’ control of when and where their commercials will be viewed, there are three additional key concerns:

1. Posting back VOD audiences to make live airing audience “whole”
   While the ACA shares broadcasters’ concerns around the decline of prime-time audiences, we do not agree this viewing has migrated to VOD. In our assessment, VOD is no more than a rebroadcast made available as a consumer convenience. Consequently, we consider the addition of this viewing into the original broadcast numbers as simply propping up the original broadcast audiences. Advertisers should not have to pay for this.
2. Financial exposure of advertisers to additional talent cycles
   Advertisers should not be downloaded with responsibilities arising from broadcasters’ decisions. Broadcasters directing advertisers and/or their agencies to ensure their ads are cleared for VOD, including talent cycles, is unacceptable. Advertisers do not have to consent to this directive nor provide broadcasters permission to place or run commercials except where otherwise expressly agreed. To be clear, any financial obligations arising from this policy should not be made to be the responsibility of the advertiser, but rather the responsibility of the broadcaster.
3. Promotion spots airing past end dates
   Another key area where advertisers will be exposed by this new policy is with airing promotional spots past their end dates. Consequences could include claims of misleading advertising, dealing with consumer dissatisfaction, or both. Again, broadcasters should be held responsible for any consequences, not advertisers.

Advertisers are fully supportive of VOD, but with dynamically inserted commercials – measured and paid – the timing of which they can control.

The ACA has been in discussions with broadcasters for more than a year to seek a solution satisfactory to both sides. There has been some progress and hope for a successful resolution including backing away from this action by employing addressable TV, but we are not there yet.

The bottom line is advertisers must be in control of where and when their commercials are run. This planned direction by these broadcasters creates associated risks and financial liabilities for advertisers that are too great.

For further information, contact Ron Lund at (416) 964-0700 / or Bob Reaume at (416) 964-0248 / .