The government’s online news legislation is winding its way to a final showdown with big tech companies while Facebook’s parent company Meta is doubling down on its threat to ban news from its platform if the bill becomes law.
The bill would require digital platforms to negotiate deals with qualifying online media companies and compensate them for content that appears on the platforms. Google and Facebook have pilloried the legislation, saying it’s unfair to force tech companies to pay for news.
“You’re basically putting like a toll booth in front of every link for a news article. And you can see why quickly that becomes untenable for us because we can’t control who puts it on the platform,” said Kevin Chan, the global policy campaign strategies director at Meta, in an exclusive interview on the most recent episode of The Hub‘s roundtable podcast.
“And so if we’re up against a rock and a hard place then we’re going to have to get out of the market,” said Chan.
That would mean Facebook disallowing news stories on its platform, which the company briefly did in Australia when similar legislation was enacted. Google recently conducted a five-week trial in which news links were blocked for some users.
The legislation, known as the Online News Act, passed third reading in the House of Commons in December and will now be studied in the Senate before it can become law.
At issue for both Google and Meta is the premise behind the bill that tech companies are unfairly gaining revenue by allowing links to news articles on these online platforms. The companies argue that news companies, which gain readers from Google search and Facebook links, are actually benefitting massively, and for free, from these platforms.
“A news publication can have a presence on Facebook, but so can a small business. So can a university, so can an activist, so can a politician,” said Chan. “What they all have in common is that they are there voluntarily. We don’t pay them to be there. They have a presence on Facebook, presumably, because they see value in it.”
Chan said it has been difficult for the tech companies to argue against the bill because the fundamental premise, that linking to news stories is somehow stealing that content, is so flawed.
“You can create a law that says, well, the earth is flat. But that doesn’t actually mean the earth is flat. And so this is a bit of a challenge with this,” said Chan.
Heritage Minister Pablo Rodriguez said the government is trying to help news organizations, which have seen advertising revenues fall precipitously over the last two decades and mostly flow to Google and Meta, stay alive in the face of these tough market conditions.
“Many news media outlets, including radio stations, newspapers, and television networks, have shut down. The bill needs to ensure that platforms also contribute to the growth of local journalism, especially smaller media outlets in the various provinces and regions,” said Rodriguez, in the House of Commons in December.
Rodriguez said it’s a mistake to see Bill C-18 as a “panacea” for the news industry, but as one tool among many to support the media in Canada.
“It is not the only (policy), since the government has brought forward several other measures to support a free and independent press, including the payroll tax credit and other programs,” said Rodriguez.
A study last year by the Parliamentary Budget Officer found that qualifying news organizations can expect to share about $329.2 million in revenue each year thanks to the legislation, if it passes.
Chan said there is some hope for the tech companies that, when the bill goes to the Senate, it will be amended in a way that allows Meta to support it.
“They may make amendments, we certainly hope they will. But obviously, it’s possible in their wisdom that the bill will be passed as it was in the House. And if that happens, then I think we’re kind of done,” said Chan.
The Senate committee that will be studying the bill includes two former journalists, Pamela Wallin and Paula Simons, who has already expressed misgiving about the legislation.
“As someone who spent 23 years as a newspaper writer, I am desperately concerned about the survival of the news industry. But at first glance, I think Bill C-18 a somewhat dubious solution. It needs tough scrutiny,” wrote Simons on Twitter last year.
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