Bill C-18: Canada and Google make peace
Google agrees to make yearly payments to Canadian news companies, but what about Meta?
On November 29, the Canadian federal government agreed to impose a yearly cap of $100 million CAD (roughly $74 million USD) on the payments Google will make to media companies under its Online News Act (known commonly as Bill C-18), set to be implemented by year-end.
This decision follows Google's threat to remove news from its platform in February. The Act mandates tech giants compensate news publishers for content that generates revenue on their platforms. The compensation extends to broadcasters, French-language, and Indigenous news organizations, based on the number of full-time journalists they employ.
Initially, draft regulations proposed a formula that could have seen Google contribute up to $172 million, but the company contested, citing an anticipated figure closer to $100 million, aligning with a prior estimate from Canadian Heritage officials. After negotiations, Google seems to have secured its preferred amount.
Canadian Heritage Minister Pascale St-Onge hailed the agreement as historic, emphasizing its support for local news publishers. The deal permits Google to comply by contributing to a collective bargaining group acting as a media fund.
In contrast, Meta (formerly Facebook) opted to block news content from Canadian users on its major platforms, maintaining this stance despite the agreement with Google. Prime Minister Justin Trudeau expressed satisfaction with Google's compliance and remained hopeful about Meta's future cooperation.
News Media Canada (a lobby group for many newspapers and magazines) agreed with several concerns raised by Google during discussions, advocating for a cap on Google's payments under the law. However, Friends, an advocacy group for Canadian broadcasters, voiced disappointment, seeking assurance that smaller and independent media groups receive funding access.
The final regulations, expected by mid-December, will address Google's concerns about payment being linked to news links and clarify that the payment is for supporting news publishers and broadcasters, not for news links themselves. Additionally, CBC and Radio-Canada (the public broadcaster for both radio and television) will receive a portion of the $100 million, determined upon finalization of regulations.
Aside from financial contributions, Google will continue offering programs for Canadian news businesses, including training, tools, resources for business development, and support for non-profit journalism projects. Existing agreements under Google News Showcase in Canada will see immediate changes due to this deal.
Google intends to reevaluate its investments in Canada upon publication of final regulations but hasn't disclosed current payments to publishers due to confidentiality clauses in contracts. The Online News Act applies to companies with over $1 billion in global revenue, operating in the Canadian news content distribution market, and having significant Canadian user bases. Currently, Google and Meta are the only companies meeting these criteria.
I have three observations:
I'm surprised by the agreed-upon amount of $100 million. Will this truly contribute to leveling the playing field? It's challenging to quantify the number of news outlets in the country, but depending on one's definition, there could be hundreds or even thousands. Google seemed to have the upper hand in the negotiations.
Where is Meta? Its silence speaks volumes. Prime Minister Trudeau may be optimistic about a resolution, but does the Big Tech firm truly care? It’s no secret the company is altering its overall strategy, gradually stepping away from news content across several markets. That said, I'd be surprised if the status quo persisted for more than six months. Considering the outcome with Google, the government is probably setting lower expectations.
Could the Online News Act apply to tech platforms with a smaller reach in the future, such as X, LinkedIn, Reddit, Snapchat, etc.? This might not be profitable, but it could be a logical (political) step.