top of page

Will Canada Force Big Tech to Compensate for News?

Lanon Wee

Meta, the holder of Facebook and Instagram, and Google have declared that they will stop showing local news on their platforms in Canada. This move has followed the introduction of a law seeking to make tech giants give settlement to news suppliers for the content they offer. So what happens next? As President of La Presse, a major French-language publication in Quebec, Pierre-Elliott Levasseur reported that he had made many attempts in the past to establish payment arrangements with tech corporations. He thought that these businesses were taking advantage of the news articles that were created by the 220+ employees at La Presse, using the data and advertisement money gained from them. "He said to the BBC that he had received a perennial refusal," he reported. He was optimistic that the introduction of the Online News Act would bring fresh funds that could be ploughed into the business. This legislation, targeting Google and Meta, necessitates tech businesses to forge payment arrangements with news organizations. In the event the two parties cannot come to an understanding, the country's broadcast regulatory entity may intervene and demand compulsory arbitration. An independent parliamentary budget watchdog has projected that the measure could create revenue of more than C$300m (£180m; $226m) per year - enough to fund roughly 30% of a regular newsroom's activities. Rather than benefitting from a large influx of money, La Presse - along with each and every other Canadian news outlet - is in jeopardy of being completely shut out, as the tech behemoths have declared that they would prefer to eliminate links to news pieces on their services instead of obeying the law. Meta, having initially been against the proposal, declared that it would begin barring Canadian users from accessing news sites over the coming months. Google has reached financial arrangements with news suppliers in Europe, Australia and other areas and seemed eager to negotiate. This week, however, Google declared that Canada's current law is "unworkable" and announced that it will cease including links to Canadian news from its search, news, and discover products once the act goes into effect in six months. It claims it has dealt with more than 150 Canadian news outlets, and estimates its traffic is worth approximately C$250 million yearly for news websites. The company declared that they are open to increasing payments, but only in a way that does not disrupt how the web and search engines are built and operate, and does not lead to any uncertain product or financial outcomes. Prior to the enactment of the law this month, the Prime Minister Justin Trudeau disregarded the warnings from the tech companies about taking away news. He commented that these tech conglomerates are attempting to strong arm Canadians by refusing to grant them access to local news, rather than pay out their fair share. He remains resolute in his stance, saying that this type of malicious behavior won't be tolerated. Organisations within the tech sector have likened the effort to that of a "shakedown", yet Mr Levasseur states that nobody in media is desiring a subsidy. He states that they are requesting the chance to discuss a reasonable business arrangement, but that the monopolistic companies have refused due to their dominant market position. The resolution of the dispute may prove to be a crucial moment in a wider struggle, as countries such as Indonesia, South Africa, India, the UK and the US contemplate similar strategies. Despite being a small fraction of the revenue generated by tech conglomerates annually, the sums being considered may still offer vital support to journalism, according to Courtney Radsch of the Liberty and Journalism Center at the Open Markets Institute, an organization that studies anti-monopoly policies. She contends that an emerging agreement exists all over the planet that Google and Facebook should remunerate for the news that they take advantage of. She maintains that there is a necessity to protect news media as a crucial aspect of democracy. Canada adopted a guideline based on a legislation that Australia enacted in 2021. This caused similar objections, leading Meta to impose a temporary censoring of news. After certain modifications to the bill, economist Rodney Sims, who spearheaded Australia's competition agency in formulating the legislation, mentioned that the two companies finally concluded more than 30 agreements with publishers having a total value of more than $130m (A$200m). He has stated that he anticipates the firms to act identically this time - although, at Meta, director Mark Zuckerberg has been urging the platform to move from news to more private content. He conceded that "Facebook just doesn't like it," but emphasized that "you can't have successful search if there is no news, and I think Facebook will realize that it is extremely difficult for them to provide you with your feed without any news." "It is what completes their service." However, some have cautioned that the way the struggle proceeds in Canada might be dissimilar. Phillip Crawley, serving as the chief executive for The Globe and Mail that has agreements in place with Google, Meta, Apple and other businesses, indicated that search is transforming in other ways, for instance the growing popularity of chatbots like ChatGPT, which provide answers in response to users' queries instead of providing them with lists of links. He believes that as more nations contemplate these steps, the corporations will have a larger inducement to oppose them. Mr Crawley stated that the global atmosphere is no longer the same and that while he endorsed the bill, he highlighted the possibility that the capacity given to Canada's broadcast regulator could jeopardize the autonomy of the media. I would suggest that the model in Australia shouldn't be a primary source of guidance for us. That was in the past; the present is a different story. Google and Meta have pointed out that the legal system in Canada is distinct from Australia in several essential aspects. Notably, while regional regulators in Australia can be appeased without companies having to negotiate with everybody, there is no such option available in Canada. Additionally, the law in Canada applies to more types of content. Google reports that it attempted, to little avail, to make its worries known to the government before the bill was established. A person at the company told the BBC that, although the government reconsidered the matter after the law's enactment, these "after-the-fact" conversations were not early enough to settle matters. Michael Geist, a Canadian tech legal scholar and vocal opponent of the bill, claims that the government has made a mistake due to the changes in Meta's operations. The company has reported that between 2016-2022, the percentage of adults utilizing Facebook for news decreased by about one third, going from 45% to 30%. Additionally, its user surveys demonstrated that people desire to see fewer news stories on the platform. Mr Geist asked why the government did not recognize the situation, noting that Facebook was serious in its desire to stop displaying news. Google has declared that it intends to take part in the regulatory process, which the timeline of which could take many months, resulting in further uncertainty for numerous newsrooms. Mr Crawley reported to Parliament last month that the Globe and Mail obtains two-thirds of its revenue from subscriptions, and Google contributes 30% of its traffic. Le Devoir, a major French-language publication, obtains 40% of its traffic from Google and close to 30% from social media. Meta has already terminated its agreements with Canadian publishers, which may be worth millions of dollars as reported, and also the grant it had given to a fellowship program. Mr Levasseur acknowledged that a blackout could have an effect on La Presse, which is profitable and is largely dependent on advertising revenue and reader contributions. He said he was sure that the publication, whose daily readership is around 1.4 million, could cope, in the same way it has with all the other profound changes the tech giants have brought to the news industry. He pointed out that terminating the print paper led to a decline in advertising revenue, but they were able to make the necessary alterations and he's assured they'll do the same this time.

0 comments

Comments


We help clients solve critical operational, business & financial issues using innovative technologies such as Web3 & Blockchain.

Address:

20 CECIL STREET, #05-03, PLUS, Singapore 049705

2023 Intric Technologies Pte Ltd

bottom of page