Canadian Heritage Minister Pablo Rodriguez has touted Bill C-18, the Online News Act, as critical for Canada’s media sector, but government’s internal modelling suggests there will be limited benefits for most news outlets. Earlier this fall, the Parliamentary Budget Officer estimated that it would generate $329 million per year, with over 75% of that revenue going to broadcasters such as Bell, Rogers, and the CBC. At the time, I noted that meant that “newspapers will receive less than 25% of the funding or about $81 million to split among hundreds of news outlets.” It turns out that the government believes that vastly overstates the benefit as its own modelling estimates about $150 million in total revenues, less than the 50% of the PBO’s estimate. Assuming a similar apportionment of revenues between broadcasters and newspapers, that would place the benefit at just over $37 million for the entire newspaper sector. In fact, as the government has expanded the eligibility to hundreds of additional outlets, the benefits for each organization shrinks even further.
Big Cost, Smaller Benefit: Government Modelling Pegs Likely Bill C-18 Revenues at Less Than Half of Parliamentary Budget Officer Estimates
Scoping User Content Out of Bill C-11: Senate Committee Makes Much-Needed Change, But Will the Government Accept It?
The widespread concern over Bill C-11 has largely focused on the potential CRTC regulation of user content. Despite repeated assurances from the government that “users are out, platforms are in”, the reality is that the bill kept the door open to regulating such content. The language in the bill is clear: Section 4.2 grants the CRTC the power to establish regulations on programs (which includes audio and audiovisual content by users). The provision identifies three considerations for the Commission, most notably if the program “directly or indirectly generates revenues.” The revenue generation provision is what led many digital creators to argue they were caught by the bill and for TikTok to conclude that any video with music would also fall within the ambit of the legislation.
The Senate Standing Committee on Transport and Communications, which has conducted months of hearings on Bill C-11, was clearly convinced that the user content issue needed to be addressed. Last night (hours after the ill-advised addition of age verification to the bill), it agreed on an amendment that, with two key caveats, goes a long way to scoping out user content regulation.
From Bad to Worse: Senate Committee Adds Age Verification Requirement for Online Undertakings to Bill C-11
The Senate committee studying Bill C-11 has ramped up the hours devoted to clause-by-clause review with amendments related to user generated content currently up for debate. However, earlier today, just prior to addressing the user content issue, the committee shockingly adopted an amendment that adds age verification for online undertakings to the Broadcasting Act. The amendment comes as a policy objective, meaning that it will fall to the CRTC to determine how to implement it. The implications are enormous since broadly defined the policy would require every online service that transmits or retransmits programs over the Internet (broadly defined to include all audio and audiovisual content) to establish age verification requirements to prevent child access to programs with explicit sexual activity. If the CRTC implements, the policy will surely be challenged as unconstitutional.
Canadian Heritage Minister Pablo Rodriguez’s claim that Bill C-18, the Online News Act, was a hands-off approach was never really credible, but the clause-by-clause review of the bill has taken the government picking media winners and losers to another level. It was always readily apparent that the bill represents an unprecedented government intervention into the Canadian media sector with the extensive power wielded by the CRTC as it sets regulations and the ground rules for the mandatory arbitration process. Further, the Parliamentary Budget Officer’s estimate on the benefits that might arise from the bill – hundreds of millions of dollars of which more than 75% would go to broadcasters such as Bell, Rogers and the CBC – provided a reminder that there was big money involved of which relatively little would go to the newspaper sector.
In recent weeks, however, the government’s role in picking winners and losers has become even more pronounced. Liberal MP Lisa Hepfner’s ill-advised comment that online news outlets weren’t real news was rightly criticized (leading to an apology and near total silence from Hepfner ever since) but skeptics feared she was merely saying the quiet part out loud since the reality of Bill C-18 is that it is the lobbying product of large media outlets, who are set up as the prime beneficiaries.
The Law Bytes Podcast, Episode 149: Ryan Clements on the FTX Collapse and Canada’s Approach to Crypto Regulation
The stunning collapse of FTX, one of the world’s leading crypto exchanges, has not only shaken the crypto world but called into question the future of blockchain and digital assets. In a year of repeated failures and crashes, the calls for increased regulation are getting louder. Ryan Clements is a law professor at the University of Calgary, where he holds the chair in Business Law and Regulation and specializes in the regulation of fintech, blockchain and crypto-assets. He’s written extensively on crypto regulatory issues, including an expert report on Canadian cryptocurrency governance for the Public Order Emergency Commission. He joins the Law Bytes podcast to provide some background into the growth of crypto, the collapses of Luna and FTX, and where Canada sits on the regulatory spectrum.