Kris Malkiewicz provides this explanation in his extremely useful book, Cinematography:
“When normal 16mm is blown up to widescreen 35mm, the great magnification results in more graininess and a poorer image quality. The problem is further aggravated by the fact that the top and bottom of the frame are lost in changing the image to a wide-screen ratio [standard 16mm has an aspect ratio of 4:3]. Super 16mm was designed to alleviate these problems.
Super 16mm film extends the image into what was formerly the soundtrack area of the original negative. This provides not only a larger image, but one that is already in wide-screen ratio. Thus, Super 16 requires less magnification when blowing up to 35mm, and hence there is a much smaller loss in quality.”
Many of new cameras today come with adjustable gates to support both standard and super 16mm formats. Older cameras, however must have their gates adjusted to allow for the increase in exposure area.
These days, Super 16 is used on a lot of mid-budget films and television programs where there is a desire to shoot in film, but the finished product will be delivered on widescreen video. The popularity of Super 16 is somewhat threatened by falling HD prices, but still represents one cost-effective ways of getting a film look.