CRTC May Open Access to U.S. Cable Audiences
On February 22nd, the CRTC will give hearing to a proposal by MEDIAdeNOVO to change policy so that Canadian advertisers could purchase advertising units on U.S. cable stations such as CNN, A&E, TLC and Spike.
Currently, Canadian viewers watching U.S. cable see U.S. ads created and purchased to reach U.S. consumers and 2 minutes per hour of product and service promotions from Canadian distributors ( eg. Rogers, Bell, Telus).We are precluded from buying inventory on any of the U.S. cable networks.
The proposal raises several questions :
What could this mean for Canadian advertisers and Canadian media owners?
Most revenue generated by the advertising on U.S. Cable will come directly out of Canadian specialty channels pockets. For advertisers, it will provide more choice for commercial placement, access to attractive niche audiences ; but a reduction in U.S. spill which for some, if the creative and product synergies exist, is simply gravy.
In terms of efficiencies and rates; I would predict that CPM ‘s will be very good.
But to put this in perspective $40 million in revenue equals less than 2% of the total TV media market; so it will NOT have a huge mitigating impact on rates or cost increases ( not that we anticipate much upward pressure in 2010/11).
As well, the sponsorships, integrations, content partnerships, promotions and cross station campaigns we can do with Canadian partners cannot be replicated by the U.S. cable avails.

Do many Canadians even watch U.S. Cable stations? Who?
Canadian viewers, despite the proliferation of new Canadian choices, spend 10% of there TV viewing time with U.S. Cable Networks. These are basically lost eyeballs and in many cases attractive niche audiences that would be a good buy target for Canadian clients.
As an example ,A&E ranks 4th, TLC 7th and CNN 17TH in deliver of adults in prime time ;often ahead of History, W, Space, Food , Comedy , Showcase and well above all the diginets. Weekly reach of U.S. cable stations is over 50% and duplication is surprisingly low with the Canadian counterparts.
Why MEDIAdeNOVO? Who is behind this bid?
MEDIAdeNOVO is an independent, unaffiliated entity whose backers include several veterans of the Canadian broadcast industry. There proposition is to sell only to National advertisers and to offer the benefit of one stop shopping vs buying from each of the local BDU’s( eg. Rogers, Shaw, Cogeco).
To “ sweeten” the proposal, they have made a commitment to redirect 70% of the revenue to a Canadian programming fund and to fund research on new media business models, social trends , technical innovation and make it freely available.
Will this really bring $100 million of “new” ad revenue to the market?
NO!It is MEC’s belief that with new TV options, we would merely shift some monies from Canadian specialty channels ( if the price is right) to U.S. cable. It would also provide cable inventory in periods where Canadian specialties channels are sold out ( so could in fact retain some monies that may in the past have either been not spent or reallocated to another medium). Let’s face it; the advertising pie is not getting bigger !( at least not as we strive to get back to 2008 levels).
How will MEDIAdeNOVO do it? What else is up there sleeve?
The technology has existed for over a decade in the U.S. to set up a network control centre to manage the insertion of Canadian ads by BDU across the country (in fact much more sophisticated insertions and near addressable techniques as well).
Future applications in this market of the technology include non-simultaneous commercial substitution. This has the potential to both “simulcast” in programmes that are NOT airing on the same night ( eg. If CTV pre-releases CSI , your commercial would air on both CTV Tuesday and NBC Friday therebye benefiting from the cumulative local audience ) . Another application would combat timeshifting, and repatriate to originating/local markets viewers that choose (consciously or not) to watch an out of market signal ( ie, you live in Toronto but usually watch the Vancouver feed of your show since it is on later ).