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The story so far: On April 5, the Canadian government introduced a Bill that seeks to make Internet platforms such as Google and Facebook pay news publishers for use of their content. The logic and the intent of the Bill is similar to what Australia implemented last year. The development is of interest to governments across the world, some of which are said to be mulling such a law, as also the larger media industry.
The Bill seeks to regulate digital news intermediaries, its summary says, “to enhance fairness in the Canadian digital news marketplace and contribute to its sustainability.” The government website lists four expected outcomes of the legislation. They include a framework that supports “fair business relationships between digital platforms and news outlets,” sustainability in the news ecosystem, maintenance of press independence, and diversity within the news landscape.
According to the Toronto Sun, Canada’s Heritage Minister Pablo Rodriquez said in a press conference after introducing the Bill, “Right now, the health and future of the news industry — especially local news — are at risk.” He has also been quoted as saying, “We want to make sure that the news media and journalists are fairly compensated for their work. Now more than ever. Canadians need reliable and credible information, especially in a time of greater mistrust and disinformation.”
The Canadian Bill is an acknowledgement of the lopsidedness of the news media industry. This is similar to what prompted Australia to pass a law last year to make platforms pay publishers. The genesis of this was a 2019 report by the Australian Competition and Consumer Commission, the country’s regulator, which saw platforms such as Google and Facebook as having “substantial bargaining power in relation to many news media businesses.” The legacy media, which has seen enormous business challenges over the last two decades, was seen as no match for the mammoth platforms with billion-plus users that have grown and prospered in the digital era.
It is in a similar backdrop that such a Bill has been introduced in Canada. Public broadcaster CBC in an article, said, “According to government figures, more than 450 news outlets in Canada have closed since 2008 and at least one third of Canadian journalism jobs have disappeared over that same time period. News businesses have struggled to make money from their content after losing major revenue streams, such as classified ads and print subscriptions. In an era of cord-cutting, some private and public broadcasters also have struggled to monetise their airwaves and pay for local, regional and national radio and TV news. The dominance over advertising once enjoyed by legacy media is over. Google and Facebook have a combined 80% share of all online ad revenue in Canada and rake in an eye-popping $9.7 billion a year, according to government data.”
It aims to correct the imbalance much in the same way the Australian law hoped to do — by ensuring platforms negotiate commercial deals with news publishers. If they can’t agree on a deal and mediation fails, “a mandatory arbitration framework” will kick in as a last resort.
In the digital world, platforms have become the most important gateways to journalistic content produced by legacy news media. Their relationship has till recently been largely about how publishers can use tools and strategies to better use the reach provided by these platforms. Google and Facebook provide much of the traffic for a lot of traditional news publishers. The platforms play a major role in news discovery. But it is now acknowledged all over the world that the platforms are able to make much of the money from this arrangement while publishers struggle. The publishers also have to contend with frequent changes to the platform algorithm, which comes with the real threat of them losing a large amount of readers all of a sudden.
The ‘money’ talk has come into being only lately, as a result of growing realisation in government and regulatory circles across the world about the increasing control that internet platforms have over news dissemination. France is another country which has forced internet platforms to enter into agreements with publishers. The enabling legislation is based on EU copyright rules, which according to a Reuters report, “allow publishers to demand a fee from online platforms showing extracts of their news.”
The last few years have seen Google coming up on its own with a framework under the ‘news showcase’ programme to license content from publishers across the world. This, it says, is to “support quality journalism.” Facebook had spoken of a similar programme last year.
Ottawa Citizen quoted Google spokeswoman Lauren Skelly as saying that the company has “serious concerns about some unintended consequences the proposed Online News Act will have on news in Canada and the search experience that Canadians know and trust.” The paper said Google “appears to be taking a different tack than Facebook’s parent company Meta by reaching out to the government.” It said, “Last week, a Meta representative told MPs the company hasn’t ruled out blocking news in Canada” over the new Bill.
While the Australian Bill was being discussed, Google had threatened to shut down its search engine in that country while Facebook talked of banning news from being shared in its products there. But these proved to be just empty threats. They stayed on, striking deals with news publishers as per the new law.
The Bill is at the stage of a second reading at the House of Commons. Whatever final shape the Bill takes, it is clear that there is a growing debate across the world on the need to regulate internet platforms especially when it comes to news. The U.K. is said to be considering rules to correct the imbalance in the media industry. In India, early this year, the Competition Commission of India, the country’s competition watchdog, ordered investigations into Google, the basis being “the bargaining power imbalance and denial of fair share in the advertising revenue,” as alleged by the Digital News Publishers Association, a group of the digital arms of India’s leading media companies. In the process of the order, the watchdog did take note of the legislations in Australia and France.
