Decoding the Impact of Google’s $100 Million Deal for Media: Who Benefits and Who Misses Out
An almost last-minute deal ahead of a December deadline saw the federal government strike a deal with Google that would avert the tech giant from blocking Canadian news on its platform.
But while the Liberal government said it was “happy” to end the standoff with the web behemoth this week, concerns raised throughout the process to pass the Online News Act (Bill C-18) have now proven valuable.
Heritage Minister Pascale St-Onge announced on Nov. 29 having come to terms with Google. The company will provide $100 million indexed to inflation to a fund managed by a single collective representing news companies.
said
in a statement.
For the government, this outcome is less of a win and more of a consolation prize. The same can be said for news organizations who hoped for a bigger payout to help their dwindling fortunes.
The path forward is one where Google has obtained what it wanted, such as contributing $100 million and not having to strike agreements with various media outlets as per the legislation.
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In the end, Google is not complying with some aspects of the bill and will save hundreds of millions over the next several years.
The government’s draft regulations for the act would have seen Google contribute up to $172 million to news organizations for the display of links.
Google already has contracts to provide funds to some Canadian publishers, but dollar figures are confidential. In that context, the $100 million being provided by Google under the Online News Act probably won’t all be new money.
The U.S. company said on Nov. 29 that there would be no immediate changes to those agreements with publishers as part of a $1 billion global engagement, but there is uncertainty past the coming into force of the act on Dec. 19.
The final regulations will be revealed at that time, and Google said it would review its ongoing investments accordingly.
Meanwhile, Meta is ironically in compliance with the law: by not displaying Canadian news content, it doesn’t have to pay news organizations a cent.
The draft regulations expected Meta to contribute $62 million annually to news organizations, but instead media have lost valuable web traffic that platforms like Facebook were driving.
Responses
The responses from media groups who are in favour of the legislation have been mitigated.
said
the deal provides a “much-needed cash injection” into news media, but is below what it had originally hoped for.
It says that since the Online News Act “will not be a panacea for protecting Canadian journalism,” the government should put other tools in place, including working through the Canadian Radio-television and Telecommunications Commission (CRTC) to extract money from foreign online platforms.
This power of the CRTC comes from the other information environment-shaping legislation the Liberals passed earlier this year, the Online Streaming Act, or Bill C-11.
The CRTC has been conducting public hearings on the matter of imposing a digital tax in recent days to bolster the Canadian broadcasting sector.
told
a House of Commons committee on Nov. 23 that they are acting “so quickly to determine now whether we should put in place an immediate contribution.”
The Canadian Association of Broadcasters struck a more optimistic tone with the Google deal, saying it hopes it will establish the “right precedent for other digital platforms that make use of Canadian news content.”
estimated
that major broadcasters like CBC and Bell could be receiving 75 percent of the funds under Bill C-18.
And the draft regulations further suggest that public broadcaster CBC could be receiving a third of the funds based on the size of its newsroom, since money is to be distributed relative to the number of full-time journalists employed.
Ms. St-Onge told the House heritage committee on Nov. 30 that CBC employs about a third of journalists in Canada.
“So I’m assuming then that the CBC will get one-third of the $100 million, which is $33 million. Do you believe that that’s just?” asked Conservative MP Rachel Thomas.
Ms. St-Onge replied that the size of CBC would need to be taken into account, and she told reporters after the committee that she doesn’t think the public broadcaster should receive a third of the money envelope.
With Meta not complying with the legislation and Google having received an exemption, Ms. Thomas called it an “absolute failure” and a “boondoggle.”
“Those local media outlets will receive very little, and possibly nothing at all. This bill has killed them,” she said.
The Canadian Press contributed to this report.
