Google announced its decision to remove links to Canadian news from its Search, News, and Discover products in response to Canada’s recently enacted Bill C-18.
Unfortunately, we've made the difficult decision that when Bill C-18 takes effect, we will remove Canadian news links from our Search, News and Discover products. https://t.co/ilWrF1uRuS pic.twitter.com/wMdoignNlC
— Google Canada (@googlecanada) June 29, 2023
In this article, we will delve into the Online News Act and how Bill C-18 has prompted major tech platforms such as Google and Meta to implement changes to search and social platforms that will impact Canadians’ access to online news.
What Is The Online News Act
Bill C-18, known as the Online News Act, is a piece of legislation introduced in Canada to regulate digital intermediaries such as search engines and social media platforms that disseminate news content, addressing the relationship between these digital platforms and news businesses.
At its core, the Act aims to establish a framework for news businesses in Canada to negotiate compensation with digital platforms that distribute their content. This is in response to perceived imbalances in bargaining power between these entities.
News businesses eligible to initiate this bargaining process must meet specific criteria, including operation within Canada and employing at least two journalists.
If negotiations are unproductive, the Act provides for a final-offer arbitration process. This involves an independent panel reviewing final offers from both parties and making a binding decision, considering the value contributed by both the digital platform and the news business.
The Act is framed to align with the Canadian Charter of Rights and Freedoms. It aims to be consistent with freedom of expression and journalistic independence.
Big Tech’s Response
In response to Bill C-18, Google and Meta have taken the significant step of removing news content from their platforms in Canada.
With the Act’s framework requiring negotiations for compensation and the potential of binding arbitration decisions, these tech giants may be concerned about such engagements’ unpredictability and financial implications.
Their decision to remove news content could indicate how they weigh the cost-benefit ratio of complying with the new regulatory environment versus the value they derive from distributing news content in the Canadian market.
It also highlights the challenges and complexities in finding a middle ground that satisfies both the interests of digital platforms and news businesses within regulatory frameworks.
Google’s Official Statement On Removing News Links In Search
In a recent blog post, Kent Walker, President of Global Affairs for Google & Alphabet, stated:
The Government has not given us reason to believe that the regulatory process will be able to resolve structural issues with the legislation. As a result, we have informed the Government that we have made the difficult decision that when the law takes effect we will be removing links to Canadian news from our Search, News, and Discover products and will no longer be able to operate Google News Showcase in Canada.
Google cited concerns over the legislation’s requirement for payment for displaying news links, which it refers to as a “link tax.”
According to the recent update, Google saw this aspect of the law as leading to product uncertainty and exposing the company to unlimited financial liability.
Furthermore, Google noted that the Canadian Government had not provided assurances that the regulatory process could rectify what the company views as structural issues within the legislation.
Despite its stated commitment to Canadian journalism through programs and partnerships, including the Google News Showcase, Google deems the current form of Bill C-18 unworkable. Thus, Google removed news links, a process it had been testing in early 2023.
The company disclosed its efforts in providing feedback, recommending amendments, and endorsing an alternative model involving an independent fund for journalism.
However, Google claimed that the suggestions were not considered, leading to concerns over the law’s impact on access to news and journalist reach in Canada.
The company aspires to maintain transparency with Canadians and publishers but expresses apprehension over the consequences of Bill C-18 should the Government fail to address its concerns moving forward.
Based on data from Similarweb, news and media outlets receive an average of 20% or more of traffic from organic searches. Google has 92% of the search market share in Canada.
Screenshot from Similarweb, June 2023Meta Will Not Negotiate With Canada Over Bill C-18
In a CBC News interview, Rachel Curran, Head of Public Policy for Meta Canada, discussed Meta’s response to the Online News Act.
Meta also posted an update with its decision to terminate the availability of news content on Facebook and Instagram for users in Canada.
The company conducted product tests to prepare for this move, affecting a small portion of Canadian users. Meta emphasized that while news content will be unavailable, other services and products, including connection with friends and family, business tools, and community support features, will operate normally.
Additionally, Meta stated that it would maintain its efforts to combat misinformation through its global fact-checking network.
According to Meta, the changes would impact Canadian and international news outlets. While these outlets would still have access to their accounts and pages and can post news links and content, some content will not be visible to users in Canada.
Nick Chegg, Meta’s President of Global Affairs, released a statement on the effect these changes would have on news outlets.
We estimate that Facebook Feed sent registered news publishers in Canada more than 1.9 billion clicks in the 12 months to April 2022. This amounts to free marketing we estimate is worth more than $230 million. Publishers choose to share their content because it drives traffic to their websites. It helps them sell more subscriptions, grow their audience and display their ads to more people than they might have otherwise.
Meta was vocal in criticizing the Online News Act, describing it as fundamentally flawed for overlooking their platforms’ dynamics and users’ preferences.
The company regarded the legislation as not considering Meta’s platforms’ value to news publishers.
Justin Trudeau, Prime Minister of Canada, called Meta’s response “disappointing.”
According to Statcounter, Facebook and Instagram hold almost 60% of Canada’s social media market share.
Screenshot from Statcounter, June 2023The Future OF Online News In Canada
The enactment of Canada’s Online News Act, Bill C-18, marks a critical juncture in the relationship between digital platforms and news businesses.
The law addresses the imbalances in bargaining power and compensates news outlets for their content. However, the responses from Google and Meta indicate a reluctance from tech giants to adapt to the new regulatory framework, leading to their removal of Canadian news content.
This development raises essential questions about the future of news dissemination through digital platforms in Canada and the evolving dynamics of regulation, technology, and journalism.
The effectiveness and consequences of Bill C-18 will be closely watched in Canada and others grappling with similar issues.
Featured image: JHVEPhoto/Shutterstock
