After months of urging Heritage Ministers Pascale St-Onge and Pablo Rodriguez to stand up to Google and Meta’s response to Bill C-18, News Media Canada – the lead lobbyist for the legislation – appears to have waved the surrender flag as it is now urging the government to accommodate Google’s concerns with draft regulations. The shift in approach unquestionably marks a retreat for the group, which literally drafted a version of the bill for the government and wielded the power of major media outlets to skew national coverage in favour of the legislation. While it insisted that the companies were bluffing when they said they would block news links if a mandated payments for links approach were adopted, it is now readily apparent that they were mistaken. Meta has blocked news links on its Facebook and Instagram platforms for more than two months and shows no sign of changing its approach. Given that Google appears to be moving in the same direction, News Media Canada’s decision to toss the government under the bus reeks of desperation as its members recognize that blocked news links on both Meta and Google would create enormous harm in lost traffic, cancelled deals, and an Online News Act that generates no revenues.
Bill C-18 stands as epic policy blunder by the government, which ignored recommendations for reforms during the legislative process and now finds itself stuck with a law that has become a model for what not to do. The key question, however, is whether the latest concession will be enough to convince Google to spend hundreds of millions on links and establish a precedent that could result in billions in liability worldwide. While News Media Canada has identified several issues where it supports Google’s request for regulatory change, the challenge is that Google’s regulatory response appears to arrive at the same conclusion as Meta, namely that regulations alone cannot save a fundamentally flawed piece of legislation. Google states:
While the Government has publicly indicated its confidence that our concerns can be resolved through the regulatory process, unfortunately the Regulations fail to sufficiently address the critical structural problems with the Act that regrettably were not dealt with during the legislative process. We continue to have serious concerns that the core issues ultimately may not be solvable through regulation and that legislative changes may be necessary.
The Google regulatory response is comprised of three sections: the economic and business case against Bill C-18, recommendations for regulatory reform, and proposals for legislative change. The economic and business case is pretty straightforward: on top of concerns of the implications for expression and an open Internet that would come with mandated payments for links, the company argues that it provides enormous value in free links to publisher websites, which it values at $250 million per year. Moreover, it notes that the value of news for advertising purposes in search is limited, since news queries are a small part of search activity (Google says only 2%) and advertisers are far more interested in advertising against searches for products or services, rather than searches for the latest news. In other words, as with Meta, news may be valuable, but it has limited value to the platforms.
The regulatory reform suggestions flow from Google’s analysis of the legislation and regulations that it believes are unworkable (I posted analysis on the regulations here, here, here, and here). The company identifies concerns such as unlimited liability (the 4% figure of search revenues, itself a fabricated number, is a floor not a cap), the likelihood that a small number of outlets can hold out by demanding bigger deals and effectively stop the CRTC from granting an exemption, concerns about news outlets that don’t actually produce news qualifying for deals, questions about what counts as support under the law, and doubts about how the timing will work given the CRTC’s parallel approach that could run until 2025.
What is notable about the News Media Canada reversal is that is appears the organization now supports changes on many of these issues. The Globe reports it now says:
“We are aligned that there should be a firm ceiling, rather than a floor on financial liability. We also agree that eligible publishers must have an online presence, non-monetary measures such as training and product can be part of the remuneration, and parties need incentives to enter into negotiation, rather than holding out.”
While this doesn’t address all the regulatory concerns, it hits some key ones.
But the problem is that regulations can only do much. As I wrote months ago, “there are no regulations to be discussed that change the core elements of the law. It’s been decided, has received royal assent, and kicks in anytime within the next 120 days.” Indeed, Google’s response identifies numerous changes to the law itself. Those changes are far more extensive and include removing links as a source of mandated payments (replaced by “displaying news content”), restoration of copyright limitations and exceptions (ie. fair dealing applies), removing broadcasters such as the CBC from the scope of the law by using the government’s own Qualified Canadian Journalism Organization standard, and adjusting the rules on what is considered news content (alpha-numeric text), exemption criteria, and the definitions around digital news intermediaries. Further, it wants to ensure it can elevate high quality news and demote low quality sources in search results and seeks a more balanced approach to arbitration.
These are significant changes that go to the heart of the problem with the law. Even if there was an openness to reform, they would need to be implemented before December 19th. That seems very unlikely given that the government has shown little interest in changes, which suggests that tinkering with the regulation may be insufficient to address a deeply flawed bill. In other words, the biggest problem with Bill C-18 isn’t the regulations, it is Bill C-18.
Related posts:
Backdown or Bailout?: What Comes Next for the Government’s Epic Bill C-18 Miscalculation
Why The Government’s Bill C-18 Draft Regulations Do Little to Ensure More Spending on Journalists or News Content
Why the Government’s Draft Bill C-18 Regulations Don’t Work: The 4% Link Tax is Not a Cap. It’s a Floor.
To paraphrase Shakespeare, ’tis sport to have News Media Canada hoist with its own petard.
Sᴛᴀʀᴛ ᴡᴏʀᴋɪɴɢ ғʀᴏᴍ ʜᴏᴍᴇ! Gʀᴇᴀᴛ ᴊᴏʙ ғᴏʀ sᴛᴜᴅᴇɴᴛs, sᴛᴀʏ-ᴀᴛ-ʜᴏᴍᴇ ᴍᴏᴍs ᴏʀ ᴀɴʏᴏɴᴇ ɴᴇᴇᴅɪɴɢ ᴀɴ ᴇxᴛʀᴀ ɪɴᴄᴏᴍᴇ. Yᴏᴜ ᴏɴʟʏ ɴᴇᴇᴅ ᴀ ᴄᴏᴍᴘᴜᴛᴇʀ ᴀɴᴅ ᴀ ʀᴇʟɪᴀʙʟᴇ ɪɴᴛᴇʀɴᴇᴛ ᴄᴏɴɴᴇᴄᴛɪᴏɴ. Mᴀᴋᴇ $80 ʜᴏᴜʀʟʏ ᴀɴᴅ ᴜᴘ ᴛᴏ $13,000 ᴀ ᴍᴏɴᴛʜ vs02 ʙʏ ғᴏʟʟᴏᴡɪɴɢ ʟɪɴᴋ ᴀᴛ ᴛʜᴇ ʙᴏᴛᴛᴏᴍ ᴀɴᴅ sɪɢɴɪɴɢ ᴜᴘ. Yᴏᴜ ᴄᴀɴ ʜᴀᴠᴇ ʏᴏᴜʀ ғɪʀsᴛ ᴄʜᴇᴄᴋ ʙʏ vs02 ᴛʜᴇ ᴇɴᴅ ᴏғ ᴛʜɪs ᴡᴇᴇᴋ.
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News Media Canada: there is an old adage that applies here: be careful what you wish for. You got exactly what you wanted. It just didn’t play out how you thought or hoped it would. You gave the “Web Giants” two choices (which you had to or else it would have been and outright shakedown instead of just a voluntary shakedown) and they chose the one you didn’t want them to.
As Nelson Muntz would say “Ha Ha”.
The news media reminds of an employee who feels he is indispensable. He tells anyone who will listen how important he is and how the company would be hurt if he left. He continually tells his boss he deserves a raise because of how valuable he is. His boss tells him he is fairly paid and easily replaceable. The employee believes the boss is lying, so one day he walks into his boss’s office and hands him his resignation and says I will stay if you pay me what I want. His boss replies don’t let the door hit you on the way out.
The aftermath – The company barely notices the employee’s absence, while the employee is left scrambling to pay his bills.
Fortunately for me, my site was seemingly spared when Meta rolled out their news links blocking. Unfortunately, I get little traffic from Facebook to begin with, so the only real way I can tell is through not only my own account, but through the accounts of others.
The problem for me here is that Google is a much more valuable platform. Like many other sites out there, if Google looks at my site differently from Meta and blocks my links, it’s game over for me. My site isn’t eligible under the Act as I ‘focus on a particular topic’ and I run the site by myself, but as others found out the hard way, that may not necessarily be a viable defence as it’s always possible that this won’t matter.
I’m personally thinking that Google will treat me similarly to Meta and leave my site alone, but if that ends up not being the case, then I’ll probably have to start working on my YouTube channel more exclusively and kiss my life long dream career of being a news writer goodbye. 🙁
If I understand the Act correctly, you would not be considered to be an “eligible news business”under section 27 of the Act. However this would not allow Google/Facebook to provide links to your site without becoming a “Digital News Intermediary”. The DNI definition simply refers to a “news outlet”, which is a superset of the “eligible news outlet” category.
That FB didn’t block links to your site for Canadians may be only a temporary reprieve.
For me this fiasco is just one in a series of fiascos that proves how completely out-of-touch the present government is.
Although I don’t have much hope for who might replace these totally incompetent politicians, given the rhetoric coming from the opposition, the propaganda coming out of mainstream canadian media and the generally poor quality of the arguments presented by those on the other side of the political divide, at this point any change would be welcome.
For me, this fiasco is just one in a series of fiascoes that proves how completely out-of-touch the present government is.
Although I don’t have much hope for who might replace these totally incompetent politicians, given the rhetoric coming from the opposition, the propaganda coming out of mainstream Canadian media and the generally poor quality of the arguments presented by those on the other side of the political divide, at this point any change would be welcome.
What we need in this country is more smart and wise people like Dr. Geist to be in advisory positions instead of the industry cronies who seem to have completely taken over policy making, having over the last 40 years imperceptibly turned our vibrant democracy into a de-facto fascist regime reminiscent of Mussolini’s Italy except for the black shirts, military parades and physical brutality but with the same if not greater levels of coercion, as we saw with the covid mandates and the unparalleled extent of overreach against peaceful protesters exercising their democratic right or, more recently, the standing ovation given to a Nazi, disregarding the war crimes he participated in, because he had been fighting Russians, forgetting that Russians basically saved Europe from the horrors of Nazism and paid a dear price for it and insulting holocaust survivors in the process.
We need to reverse course if Canada is ever to climb back from the dangerous slide into totalitarianism, and it starts with kicking out the immature empty headed figurehead of man that we have as a prime minister and his clique of out of touch fools.
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Why does management in the media/news sector seem so abysmal? I read about this and got confused as to why the lobbyists who got exactly what they asked the government for, are now asking for something else? This is much like twenty or so years ago when the heads of our telcoms demanded the CRTC allow them to buy up every media biz and news outlet they could because they owned this thingy called the internet and didn’t know what to do with it. Instead of sticking to their core business, they expanded into areas they had no knowledge of. Sounds like the same management strategy our governments like to use…
Sᴛᴀʀᴛ ᴡᴏʀᴋɪɴɢ ғʀᴏᴍ ʜᴏᴍᴇ! Gʀᴇᴀᴛ ᴊᴏʙ ғᴏʀ sᴛᴜᴅᴇɴᴛs, sᴛᴀʏ-ᴀᴛ-ʜᴏᴍᴇ ᴍᴏᴍs ᴏʀ ᴀɴʏᴏɴᴇ ɴᴇᴇᴅɪɴɢ ᴀɴ ᴇxᴛʀᴀ ɪɴᴄᴏᴍᴇ. Yᴏᴜ ᴏɴʟʏ ɴᴇᴇᴅ ᴀ ᴄᴏᴍᴘᴜᴛᴇʀ ᴀɴᴅ ᴀ ʀᴇʟɪᴀʙʟᴇ ɪɴᴛᴇʀɴᴇᴛ ᴄᴏɴɴᴇᴄᴛɪᴏɴ. Mᴀᴋᴇ $180 ʜᴏᴜʀʟʏ ᴀɴᴅ ᴜᴘ ᴛᴏ $13,000 ᴀ ᴍᴏɴᴛʜ ʙʏ ғᴏʟʟᴏᴡɪɴɢ ʟɪɴᴋ ᴀᴛ bd02 ᴛʜᴇ ʙᴏᴛᴛᴏᴍ ᴀɴᴅ sɪɢɴɪɴɢ ᴜᴘ. Yᴏᴜ ᴄᴀɴ ʜᴀᴠᴇ ʏᴏᴜʀ ғɪʀsᴛ ᴄʜᴇᴄᴋ ʙʏ ᴛʜᴇ ᴇɴᴅ ᴏғ ᴛʜɪs ᴡᴇᴇᴋ.
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