Meta executives faced another round of criticism at the Standing Committee on Canadian Heritage yesterday, yet beyond the usual outrage emanating from MPs that have labelled critics as racist or dismissed online news outlets at not news, was the growing realization that the company’s plan to block news sharing in Canada if Bill C-18 passes in its current form may not be a bluff. Meta has adopted a consistent position for months that the bill creates the prospect of unlimited liability for linking to news articles, the vast majority of which are posted by the media companies themselves. Paying for those links is viewed as uneconomic and untenable by the company, which would rather exit news sharing altogether in Canada rather than cough up millions of dollars for links.
Canadian Heritage Minister Pablo Rodriguez has been asked about the prospect of blocked news sharing for months, but has been unable to provide a cogent response, relying instead on canned talking points about his disappointment with Meta turning to the “Australian playbook”. But that response won’t work if Bill C-18 becomes law and news sharing disappears on Facebook and Instagram in Canada.
Indeed, the harm caused by the government’s miscalculation that it could force massive payments for links will extend beyond a failed law that will fall far short of meeting the government’s estimated benefits. The lost value from the disappearance of free links alone will run into the hundreds of millions of dollars. Moreover, the existing deals with Canadian media outlets will be placed at risk as the company’s exit from news sharing is likely to also accelerate an end to the support programs and private deals. Smaller and independent media outlets, who often depend upon social media to build their audiences, will bear a disproportionately larger brunt of the harm. In fact, if Google follows the Meta approach, there will be terminated deals, no “digital news intermediaries” in Canada, no new revenues, and Bill C-18 will not apply to anyone.
To be clear, News Media Canada, the lead lobbying group for the news sector, must shoulder some of the blame. Many of its largest members already have deals with Google and/or Facebook. Yet it was the greed of hoping for bigger deals based on link payments – not new revenues for smaller publishers, many of whom did not want this legislation – that led to the group to bet that the government could force the Internet platforms to pay for linking. Ironically, had the government and lobbyists supported the “journalism fund model”, the Internet companies likely would have gone along with the plan and the Rodriguez could be trumpeting renewed support for journalism in Canada.
Instead, he now finds himself on a path toward overseeing the worst possible outcome for all concerned: reduced revenues for news outlets, less news exposure for Canadians, and a global reputation as a government that undermines fundamental notions of the free flow of information online by supporting mandated payments for links (not to mention the recently adopted Liberal party resolution that places press independence at risk). The net effect will to be set back the government’s effort to support the news sector by at least five years as the lost revenues in terminated deals and missing links will likely exceed the total value of the government funding and labour tax credits.