Virtual advertising enters the game

With clubs seeking to open new revenue streams, Florentin Sanson of CMS France looks at the opportunities arising from virtual advertising, and the associated legal challenges.

On 15 April 2018, for the first time in France, the French football champion, Paris-Saint-Germain, displayed virtual advertising on the perimeter boards of the pitch during the Ligue 1 match against its runner-up Monaco at the Parc des Princes in Paris. In practice, it means that TV viewers watching the match saw different ads on the perimeter boards depending on which country they were located in. 

This live test in France comes just after another test implemented successfully earlier in February 2018 in Germany during the football Bundesliga match between Borussia Dortmund and FC Augsburg. Since then, the German Football League (DFL) has given the green light to use this technology for Bundesliga matches during the coming season 2018/2019.

The development of virtual perimeter advertising has been long-awaited and is of particular interest for football clubs since it could open up new revenue streams. Indeed, they could target specific markets by broadcasting audience-oriented ads tailored for each territory where the TV signal is received.

European football clubs could now segment the distribution of ads depending, for instance, on the type of broadcasting (live or delayed). They could offer advertisers context-based brand communications associated with an event (e.g. when a team scores) as well as personalised advertising (based on the profile of the TV viewer and his or her specific behaviour).

In addition, virtual advertising could let advertisers and broadcasters adapt or select the ads to be broadcast to comply with local regulations and restrictions on ads, such as those regarding alcohol and tobacco in France.

In February 2003, the French TV broadcasting regulator Conseil Supérieur de l’Audiovisuel (CSA) indicated that it did not object to the French Rugby Association using virtual advertising to display ads for alcohol during the 2007 Rugby World Cup in countries other than France (where such ads are prohibited on TV). Nevertheless, it further specified that, should a TV broadcaster introduce virtual advertising outside spaces dedicated to advertising and broadcast it in France, such communication would constitute surreptitious advertising, which is prohibited under EU and French law.

Furthermore, personalised advertising could face a regulatory hurdle in France, apart from data protection issues: TV broadcasters are legally bound to broadcast ads simultaneously to all TV viewers in the same territory, which could exclude targeted advertising based on the viewer’s behaviour.

After its public opinion in 2003, the CSA did not further advise on virtual advertising in sports. In July 2016, it merely indicated that legal impediments to virtual advertising should be first discussed between broadcasters and leagues. Since then, no specific regulation regarding virtual advertising has been enacted in France, nor has the CSA clarified its position on this matter. 

The recent use of virtual advertising in European football leagues could encourage competent authorities to clarify or amend rules in this respect.

Auteurs

Florentin Sanson
Florentin Sanson
Advocaat