PHOTO ILLUSTRATION: THE GLOBE AND MAIL. SOURCE PHOTOS: THE CANADIAN PRESS, AFP via Getty Images
Taylor Owen is the Beaverbrook Chair in media, ethics and communications and the director of the Centre for Media, Technology and Democracy at McGill University. Supriya Dwivedi is the director of policy and engagement at the Centre for Media, Technology and Democracy.
Ever since the passage of Bill C-18, the Online News Act, both the Canadian government and the companies it is seeking to regulate – Meta and Google – have backed themselves into respective corners.
The government pushed forward with the controversial bill, hoping that Google and Meta would expand the deals they currently have with some Canadian publishers to a wider range of outlets. The tech companies, meanwhile, are very clearly using Canada as a warning shot to other jurisdictions in the process of enacting similar policies – including the state of California, the U.S. Senate, Britain, Indonesia and Brazil – by blocking links to Canadian news outlets in advance of the law taking effect later this year.
We could very well end up in a world where a Google search result does not include information produced by Canadian journalists, or a link to a Canadian news story is blocked from being posted to Facebook, Instagram and Threads. This is a bad outcome for all involved: Ottawa fails to get what it set out to achieve (accountable deals with a wide range of Canadian publishers), and the platforms undermine their core value propositions (to help users find interesting and important information) with potentially huge reputational and financial costs to them globally. And, of course, Canadians suffer between them.
So where do we go from here?
The journalism industry in Canada, as in all democratic countries, is in a period of transition. Leaving journalism to the whims of the market carries significant risk – more risk than other commodities and resources – because reliable, factually accurate information is a core requirement for democracy. Companies such as Google and Meta cannot solely be blamed for the decline of journalism, but the fact is that the platforms have consistently misled journalism organizations (for example, by inflating metrics and promising tools and compensation schemes that don’t function), and their current deals to fund a select group of publishers are hidden behind non-disclosure agreements and are entirely unaccountable.
The government is right to look for ways of assisting the journalism industry, but that means also thinking about how its aid must be a stopgap measure. Indeed, thinking of C-18 as a transition policy – as one piece of a wider policy approach, rather than the singular solution to the problems facing journalism – may provide a path forward.
First, the Canadian government should start by looking for a compromise on C-18 with Google, as Meta has stated categorically that it will not comply. Two years ago, the government held a public consultation on whether it should support journalism via the bargaining code model (C-18), or via the creation of a central journalism fund that would allocate money directly to Canadian news organizations. The latter model has two main issues: It would require a dedicated tax on platforms – which would likely be in breach of our trade agreements – and it would require a far greater role for government in the affairs of journalism. However, since the platforms have themselves been calling for a fund model, there is nothing stopping them from creating one themselves. In fact, Google could simply expand its existing Google News Initiative, a program through which it already has deals with some Canadian publishers, and turn it into a fund designed to be in compliance with the exemption criteria of C-18.
In order to address Google’s reasonable concerns of unlimited and interminable liability (i.e. how much and for how long they will need to compensate outlets), the government could propose a sunset clause on C-18 as well as an overall funding cap, and offer to match Google’s contribution to the fund from general revenue to make up for Meta’s lack of participation. The result would be a much larger funding program from Google to publishers, and deals for a far wider range of publishers that are subject to some degree of transparency and democratic accountability.
Second, while it is simply not true that C-18 disproportionately benefits large established publishers over smaller independents – deals would almost certainly be roughly prorated to the amount of journalism done – it is true that smaller publishers that rely more heavily on Facebook for distribution could be disproportionately harmed by Meta’s URL-blocking. Those publishers who currently have deals with platforms also risk losing crucial funding should their existing deals be cancelled in retaliation for the government passing the bill. And what’s also true is that we need far greater innovation and scale in the Canadian digital news ecosystem. Government journalism policy to date has not been focused enough on this future-looking aspect.
Ottawa has a potential reserve of funds with which to address these issues. Earlier this month, the government announced that it is pulling all federal advertising from Meta’s platforms; it should redirect the roughly $11-million that had been devoted to ad dollars toward smaller, independent outlets outside of the mainstream legacy corporate media environment. This would provide immediate financial relief for the smaller outlets struggling for ad revenue in a media market dominated by Meta and Google. The government could also help backstop a venture capital fund for news startups that are independent, wholly Canadian, and in the early stages of development, to help with a core challenge that such startups face in Canada’s small news market: access to reliable capital, to experiment and grow. And because many business models for news rely on subscriptions, the government could substantially expand the subscription tax credit (currently a 15-per-cent deduction that one can make for subscriptions to qualified outlets that could be expanded to 70 per cent, as The Globe and Mail’s editorial board has recommended), or evolve it into an annual voucher of $200 to $300 to be spent on journalism. Canadians could then directly choose what journalism they want to support with their tax dollars.
Third, at its core, C-18 is about trying to right a power imbalance between the two companies that control 80 per cent of the Canadian digital ad market and the core distribution channels for news in Canada, and Canadian publishers that are in serious financial peril. But the coming legislation is only one of many tactics for addressing this imbalance. The underlying issue with the dominance of Big Tech rests in how companies such as Meta and Google may employ anti-competitive practices and how they use our data to entrench their advantage. While the government of Canada certainly does not have the power to go back in time and block the consolidation that has occurred in the digital ad market, it is able to empower our competition and privacy commissioners to conduct an investigation into how Big Tech operates in the Canadian ad tech market.
And finally, if the government is committed to a robust and vibrant Canadian journalism industry, it must get serious about reimagining the CBC for a contemporary Canada. This means the CBC must adjust its priorities to refocus on public-interest journalism and fill the current need for coverage in areas that are now effectively “news deserts” because of the loss of local private media. It means removing the CBC from C-18 inclusion – making it so that the public broadcaster would not receive revenue from Google and Meta – and taking the broader step of shifting the CBC from a market competitor that finances programming in part with commercial advertising, to a public service that provides all Canadians content for free, including allowing its content to be republished by other journalism outlets. It might change the very nature of the CBC, but it would give us a more relevant and better product – and would allow the CBC to thrive as part of the broader public media infrastructure needed for a 21st-century democracy.
The Online News Act is not perfect, and there is no single silver bullet. But Canadian legislation cannot be held hostage to threats from foreign companies. There is no question that the government and Big Tech are at an impasse, but there is a way forward – starting with viewing C-18 not as the end of the journalism policy conversation, but the start.