Bill C-18, the Online News Act, received royal assent yesterday, but any celebrations by the groups who lobbied for unprecedented government intervention into the news sector must surely have been tempered by the reality that quickly emerged. Meta confirmed that it would block news sharing from its Facebook and Instagram platforms in Canada, while Google met with Canadian Heritage Minister Pablo Rodriguez to see whether a compromise could be reach to avoid a similar outcome. The end result – at least for now – is a legislative mess that leaves no clear winners with Meta downgrading its platforms in Canada, Canadians cut off from their ability to share news on popular social media platforms, Canadian news outlets losing their second most important source of referral traffic, and the government looking to have made an epic miscalculation for having ignored the risks it created by establishing a mandating payments for links system with uncapped liability for the Internet companies.
In less than two months, the government has reshaped the Internet in Canada with Bills C-11 and C-18 leading to streaming services that may block Canadian users and platforms that may block news sharing. The result is a cautionary tale for Internet regulation initiatives with Canada emerging as a model for how things can go badly wrong. The initial Bill C-11 consultations at the CRTC have resulted in some streaming services unsurprisingly responding to legislation that applies Canadian law to every service anywhere in the world by raising the prospect of exiting the Canadian market if not granted exemptions. Bill C-18 threatens to create a Canadian news void on Facebook and Instagram, a result that will increase the visibility of low quality sources and lead to millions in lost traffic and revenues for the supposed beneficiaries of the bill.
While I have seen some seemingly celebrate this outcome, this is nothing to celebrate even if you think Facebook is an awful platform for news sharing. News is not a significant part of Facebook feeds (the company says about 3%) and it is highly substitutable (users spend the same amount of time on the platform whether presented with news links or photos of friends). But it is important to many news outlets, who told the Senate studying the bill that it provides between 17 – 30% of their traffic. This is particularly true for small, independent and digital-first outlets that often rely on social media to develop readership and establish community. Losing those free referral links will have a damaging effect on those news outlets and undermine competition, leading to reduced traffic, less ad revenue, and fewer subscribers. Indeed, the publishers know the value of Facebook since they are the ones that post the majority of links to their own articles. Tough talk from Rodriguez will be cold comfort for those who have lost those links and lost revenues due to government policy.
The mistake was not that the government pursued Internet regulation. It was that it pursued the wrong regulation. It is striking that Bill C-27, the government’s long delayed privacy and AI regulation bill, went virtually nowhere during the Parliamentary session. If the government was serious about constraining big tech, tougher privacy and data governance rules would have been job one, not an after-thought that has languished for years. Instead of trying to stop problematic conduct, the government chose to profit from it. Big tech was treated as a policy ATM to fund policy objectives such as film and television production or the news sector. But having ignored the real costs of its proposals (as well as the real future news developments such as generative AI), the government finds itself in the worst of all worlds with a news bill that may actually result in more losses. Meanwhile, its broadcast bill has some streaming services thinking about reducing their content libraries in Canada and conventional broadcasters lining up to reduce their Cancon contributions.
This outcome was both predictable and entirely avoidable. In the case of Bill C-18, Meta never strayed from the position that the bill rendered Canadian news uneconomic on its platforms and that it would stop news sharing in response. This was never about paying for the use of news articles, since Facebook doesn’t actually post full news articles. Its users do the posting and even then only post links that send the traffic back to the original source. Had the government listened to anyone other than media lobbyists, it would have considered alternatives such as a fund model that would have avoided payments for links, concerns about press independence, as well as risks to trade and copyright obligations. But in a process that initially even tried to exclude Meta from appearing before committee, there was no room for dissenting views. And now there will be no room for Canadian news on the world’s leading social media platform as part of the government’s made-in-Canada Internet.
It continues to disappoint me Prof. Geist that you continue to include links to (Globe and Mail specifically) paywalled news articles. The paywall block says I simply need to log in, but even once I have done so the article continues to be locked behind the paywall.
Please use a news source that is free for everyone, and doesn’t exclude low-income readers from being able to read your linked sources.
Although, I suppose the irony in all of this is that The Globe and Mail will have to try even harder to rely on subscriber revenue now that they have lost all of the free referrals (and any opportunity to monetize those referrals) to their web-site from Facebook (and soon Google).
I hope they are happy with that their industry lobbyists have done for them.
Somebody needs to get fired.
Sources should be chosen based on the quality of the material. If only ‘free’ sources are allowed it would degrade and limit their quality.
While I agree that Bill C-18 is horrible and harmful, I have sympathy for businesses trying to figure out how to finance quality news and understand that the best quality stuff may have to live behind a paywall. It is unfortunate and inconvenient, but they have to figure out how to make their businesses survive, and we shouldn’t punish them by stopping linking to the best stuff.
Besides, Prof. Geist maybe just happens to read the Globe so he knows of a Globe article that is relevant, so he uses that. Asking him to spend the time finding alternatives is a big ask, or are you asking him to stop reading the Globe in the first place? Either way, he does allow commenting on his article so his readers are free to post their own related references.
It’s very easy to get around a paywall using a site like printfriendly.
Let’s take a look at how CRTC regulation has turned out so far. TV regulation has given us high cable prices, mandatory channels, and only 6% of Cancon spending being spent on comedies and dramas.
Cell phone regulation has given us high prices, three big providers, and pretty much every small cell phone provider being owned by the big three (Flanker Brands).
ISP regulation has given us high prices, 4 big providers, and now because of the wholesale rate decision pretty much every independent ISP has become a flanker brand.
I can hardly wait for the high prices and lack of choice that the CRTC will mandate because of Bills C11 and C18.
Cell phone regulation has given us high prices, three big providers, and pretty much every small cell phone provider being owned by the big three (Flanker Brands).
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I don’t know if Minister Rodriguez realizes the irony of a statement that he made to Rosemary Barton, and reported yesterday in the CBC website, “you have to consider that this has value and pay for that value”. Here he is pointing out that a link has value to the news media sites, as well as Meta and Google. And given what he has been saying about all of this, the link has more value to the news media sites than it does to Google and Meta. And yet he expects Google and Meta to cough up $$$ but not the news media sites.
It’s concerning to hear that Bill C-11 regulations may lead to blocked content or services in Canada. It’s important to strike a balance between protecting intellectual property rights and ensuring access to information and entertainment.
Except that there is nothing to balance here.
The links that Facebook and Google provide are not using any (of the news media’s) IP at all. They are simply links. Links are the entire foundation of the Internet and made by everyone who makes them, free-of-charge. Without links there would be no Internet.
Moreover, the value in these links goes one way only and that value is to the news organizations. Google and Facebook get no value from these links. Those links are how the news organizations get users to their sites where the news organization now has their eyeballs to monetise in any way they can — subscription, advertising, etc. The news organizations cry foul that Facebook and Google have “stolen” their ability to advertise. Well guess what news organizations. You have just further impeded your ability to advertise by forcing Facebook and Google to stop referring traffic to you FREE OF CHARGE!!
These very news organizations are going to see their traffic plummet and their ability to monetise plummet due to these new regulations. They have done the quintessential act of shitting in their own bed, or killing the golden goose, however you want to look at it.
I hope the news organisations (or their lobbying interest) and Pablo are quite satisfied with the cock-up they have made of all of this.
Pablo is going to go down in history as the undertaker that put the last nail in the coffin of the traditional news industry here in Canada. I guess he will be famous for one thing at least.
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