After more than three months of dormancy, the Canadian Senate debate on gambling advertising picked up again this week with four hours of sessions discussing betting ads.

The Transport and Communications Committee held a pair of meetings on Sept. 24-25 regarding Bill S-269, the National Framework on Advertising for Sports Betting Act.

These were the first hearings on S-269 since June, wherein senators discussed the legislation that would develop a national framework for sports betting advertising, identify measures to regulate ads, and focus on finding ways to prevent and help both minors and problem gamblers from being impacted.

During those June sessions, several senators expressed regret over not considering deeply enough the ramifications of the decision to expand online gaming and betting in 2021. This time around, numerous witnesses from various working backgrounds had their say. A core focus was the complex concern around the role social media plays in disseminating widespread betting ads, particularly to young Canadians.

Canada can learn from UK, which fell “asleep on the job”

Kicking off the first session, Lord Michael Grade, who chaired the UK House of Lords’ Gambling Industry Committee and also serves as chair of UK telecom regulator Ofcom, warned that Canada must avoid “dereliction of duty” and chart a firm path forward.

Referring to what he believes has been a failure by the UK Gambling Commission (UKGC) to respond to the fast evolution of technology and its effect on gambling, Grade says the UKGC has “been asleep on the job” since the advent of the smartphone.

“They lost the plot on the way that operators were using smartphones and advertising and free money to target … those who already gamble more than they can afford, and those who often have tried to combat their addiction but are all too easy to tempt back through direct advertising,” he told committee members.

Grade’s key message was that Canada has the privileged position of being able to learn from other jurisdictions.

“You would be in dereliction of duty, if I may be so bold, if you ignore this problem now.”

Lord Michael Grade (UK House of Lords’ Gambling Industry Committee)

“With the knowledge you have of what’s gone on around the world, particularly in the UK and Australia and other places, you would be in dereliction of duty, if I may be so bold, if you ignore this problem now that you’ve legalized [sports betting] in the way that you have. There are lots of case studies and case histories that will inform you and help you draw the line between restriction and freedom to gamble. I think you’re coming at it very luckily, in one respect, that you’ve got all this case law and history from around the world that will help you to make the decisions that are right for Canada.”

Social media has changed the game

In that first session, Alberta Sen. Paula Simons, a self-professed staunch opponent of gambling expansion, suggested that the federal government opened up an  “enormous can of worms” by legalizing online betting without fully appreciating exactly how it would permeate daily life.

“I think people were very naive,” Simons said. “They were thinking about the betting practices of their past, where you just bet on the outcome of a game. I’m not sure the people who supported this bill [C-218] understood that in a digital era, this was going to be a much more complicated and enticing, addictive kind of gambling advertising.”

A similar point was made by multiple witnesses in their testimony and responses to senators’ questions, noting that the proliferation of betting ads on ubiquitous social media platforms poses a “unique” challenge.

“[Algorithmic] sports betting ads … can have a uniquely harmful effect normalizing gambling behaviour.”

Helen A. Hayes (Centre for Media, Technology and Democracy)

“A lot of what we’re talking about in the online ecosystem has to do with people’s access to content that gets algorithmically fed to them on social media and other internet platforms,” said Helen A. Hayes at the Centre for Media, Technology and Democracy. “Sports betting ads, when delivered to the same algorithmic systems that drive engagement on social media, can have a uniquely harmful effect normalizing gambling behaviour at an early age by providing insight into access and promoting ease of use.”

Minors seeing too much, say witnesses

Both a symptom and a result of that, witnesses argued in their testimony, is not only that there is too much gambling advertising but that it reaches the most vulnerable demographics: those with tendencies towards addiction or problem gambling and also young Canadians.

Multiple witnesses in the second session cited data from the Centre for Addiction and Mental Health (CAMH) which suggested that the number of students from grades seven to 12 who have gambled online rose from 4% in 2019 to 15% in 2021, and has likely increased further in the three years since then. Joannie Fogue Mgamgne, a member of the Mental Health Commission of Canada’s youth council, also referred to research that suggests that approximately one in five Canadians aged nine to 17 engages in online casino or other online gambling.

“Gambling ads and companies have found new ways to target youth by gamifying the experience,” Fogue Mgamgne told the committee. “There’s this expectation that you are just playing a game, but what you’re actually doing is gambling… They’re using our favourite athletes and celebrities and now, in this world of influencer media, you see them using influencers to quite literally influence us.”

“There’s this expectation that you are just playing a game, but what you’re actually doing is gambling.”

Joannie Fogue Mgamgne (Mental Health Commission of Canada’s youth council)

That uptick speaks to the ubiquitous visibility of gaming and sports betting marketing, posited Hayes. “The ad doesn’t necessarily have to be explicitly targeted to children, but they are accessible to children or have the potential to be reached by young users online,” such as young people who watch sports regularly on TV or online.

Matthew Young, chief research officer at Greo Evidence Insights, agreed that while underage gambling is not new, the huge amount of advertising means the problem has worsened. In particular, he said that the fact that so much advertising intrinsically links betting with sports fandom means that some people believe betting is a core part of being a fan. Young suggested that concern is particularly acute when it relates to young adults.

Some argue current rate of advertising is temporary

Later in the second session, the committee heard from Kevin Desjardins, president of the Canadian Association of Broadcasters (CAB), a group of private-sector radio and television operators, as well as Responsible Gambling Council (RGC) CEO Shelley White.

Both Desjardins and White told the committee that Canadian broadcasters have begun taking measures to limit the quantity of sports betting ads on their channels. Desjardins noted that not only have some CAB members have established “internal and voluntary” limits on the number of gaming ads they accept per program hour, they have also reported that operators are not asking for as much ad time as they were in the earliest days of Ontario’s commercial online gaming market.

Marketing, of course, has been a core component of the first two-and-a-half years in Ontario as dozens of operators competed to get a foothold. Noting that brands entering the market were not allowed to advertise inducements like welcome bonuses in the way that many U.S. markets allow, Desjardins said that pushed brands to explore other ways to raise brand awareness in a saturated field.

He also surmised that marketing has played an important role in bringing players out of the shadows of the grey market and into the light of regulation, noting that “the early research shows that while awareness of sports betting is growing, the number of active bettors is remaining at historical levels.”

Desjardins and White both argued we should expect the ubiquity of advertising to fade away somewhat as first-look brand awareness becomes less important in a market gaining maturity.

“What we’ve seen in terms of advertising over the last two years is not representative of what we anticipate going forward.”

Kevin Desjardins (Canadian Association of Broadcasters)

“It’s important to recognize this is a nascent industry,” Desjardins said. “To some extent, it’s not unlike advertising at the dawn of the dot-com boom, a new market that emerged seemingly from nowhere and which seemed ubiquitous in the moment but in time normalized. What we’ve seen in terms of advertising over the last two years is not representative of what we anticipate going forward.”

“We know based on other jurisdictions that it’s common to see an increase in the amount of advertising,” added White. “Over time, this is going to decrease as it becomes less novel. Having said that, it’s extremely important we consider the unique risks that gambling ads have for youth and young adults, and that measures are taken to prevent those risks.”

What was recommended to the committee?

So, what exactly do this week’s speakers want to see? Many of the proposals centered on greater restrictions on the quantity and nature of gambling ads, as well as more diligence in ensuring minors are not targeted. On that latter topic, Hayes called for the framework to stipulate that sports betting ads should be evaluated based on their likelihood to appeal to and reach young internet users.

There were other notable specific suggestions.

Young argued that the bill should be expanded to encompass all forms of gambling, not just sports betting, noting that while sports betting has great appeal, online casino is still king when it comes to total wagers. He also advocated strongly for reductions, if not a full ban, on advertising during live sporting events, something which Grade noted the UK has done.

Brian Dijkema, president of Canada at Christian think tank Cardus, called for a ban on ads for in-game bets, arguing that the speed and instant-gratification nature of live betting effectively makes it akin to an addictive online slot machine.

Meanwhile, among the recommendations made by Rob Simpson, principal at consultation firm Sagewood Resources, was that the Criminal Code be amended to define the term “conduct and manage,” which he asserted has “devolved into pro forma meaningless recitation.”

“Why a core Criminal Code construct remains undefined is incomprehensible,” Simpson told the committee. “A definition will bring accountability to every party involved in the provision of gambling across Canada.”

The strongest opposition to Bill S-269 during the two sessions came from Desjardins, who called the idea of a national framework “premature and an unnecessary overreach” that would step on the toes of the work done by provincial regulators, impede regulatory changes and add to the confusion around sports betting ads.

While Desjardins noted that the newly regulated market requires a responsible advertising regime, he suggested that there is no evidence demonstrating that the outcomes that people want would be achieved by limiting betting ads.