Canada recently passed a law that requires tech giants like Meta and Google to pay news organizations for hosting their work. Instead, those companies have decided to block Canadian news. Canadian media may soon have no choice but to lessen its reliance on major tech companies—but to many, it feels like that wouldn’t be such a bad thing.
The Canadian government passed the Online News Act, also known as bill C-18, earlier this summer. It’s a law that’s meant to force tech giants like Meta, which owns Instagram and Facebook, and Google, to compensate the media outlets whose work appears on their sites. However, the situation has somewhat backfired. Both Meta and Google have threatened to pull Canadian news off their sites entirely, and Meta has gone as far as to actually do so—for many in Canada, the Instagram and Facebook pages of outlets like the CBC, the Globe and Mail, and even us here at Xtra are no longer visible.
Bill C-18, now known as the Online News Act, became law in June. The Heritage minister at the time the bill was introduced, Pablo Rodriguez, said it was meant to address a “market imbalance” that had grown between tech companies and media companies. Essentially, advertising dollars have migrated from media outlets to large tech companies like Meta, Twitter (now X) and Google. While even the country’s most established news outlets have been forced to undergo massive layoffs, the Canadian government reports that 80 percent of Canada’s online advertising revenue in 2022 was divided between just two tech platforms.
The act itself is a regulatory framework for bargaining, which means that in the best-case scenario, tech companies and media outlets make deals on their own. The idea is that the bill forces tech companies to enter into negotiations with individual news outlets that lead to some type of ongoing funding arrangement. If a tech company doesn’t take the initiative in making those deals, a mandatory mediated bargaining period would occur. If that’s unsuccessful, a third-party arbitration panel would impose a final agreement that both parties would have no choice but to accept.
The details of how this will all transpire and the parameters of agreements that the government will consider “fair” are not yet final. Proposed regulations involve Canada’s regulating body for telecommunications, the Canadian Radio-television and Telecommunications Commission (CRTC) assessing the deals made independently to ensure that they provide a sufficient amount of compensation and don’t curb freedom of press. They also specify the size and profit margins of tech companies that would be subject to the legislation.
While it’s unclear exactly how much money will be in the offing—a recent estimate by the Canadian government said Google and Meta could be coughing up as much as $230 million per year cumulatively—the goal of the bill is straightforward: take money from the tech industry and put it into the hands of cash-strapped media outlets.
It is not surprising, then, that major tech companies are not pleased. Both Google and Meta have sharply criticized the act. In a press release, Google called it a “link tax” and argued that it opened them up to “uncapped financial liability simply for facilitating Canadians’ access to news from Canadian publishers.” Both companies threatened to pull Canadian news links completely rather than comply with the act, which is set to come into effect at the end of this year.
But Meta, it seems, set its clocks a little early. On Aug. 1, Meta announced that it had started removing links to news articles for Facebook and Instagram users in Canada. By Aug. 9, many news media profiles were inaccessible to many Canadian users, including those of some international outlets that would not be subject to the bargaining agreements covered under the Online News Act.
According to a survey taken in 2022, 25 percent of Canadians primarily access news through social media. Therefore, the fact that two major social media platforms no longer carry Canadian news provides a significant barrier to access.
The economic and social impacts of the news ban
The short-term effects of this are twofold. First, some Canadian news outlets are noticing an immediate financial hit. Sarah Krichel, the social media manager at The Tyee, an independent, online magazine based in B.C., told Xtra that the average number of people who find The Tyee’s website through Facebook has dropped 76 percent from this time last year, and the amount of readers who access The Tyee through Instagram has dropped 49 percent.
Additionally, Meta platforms have historically generated four new paying The Tyee subscribers per month. On average, those subscribers combined would contribute about $1,068 to The Tyee, Krichel says. As a result of the news ban, Krichel says they’re expecting the number of new subscribers from Meta platforms to drop to zero, which means they’ll be losing out on the financial contribution of potential new subscribers.
But it’s not only news organizations that are taking a hit. A recent spate of wildfires in the Northwest Territories is showing in real-time how this ban could affect people’s ability to access crucial information during emergencies. In mid-August, widespread wildfires forced the majority of the territory’s residents to evacuate their communities. Meanwhile, residents were unable to access information about evacuations, where the wildfires were spreading or what the risks were on either Facebook or Instagram.
“When only a handful of tech companies have so much control over the information ecosystem online, these are the kinds of risks that come along with that,” says Arik Ligeti, the director of audience for The Narwhal, a non-profit investigative outlet, told Xtra. “Tech companies have the power to really influence people’s ability to get critical information. So it’s scary when they say that now they’re not going to do that anymore or, in the case of Google, that they are considering taking that action.”
There is some hope that Meta and Google may yet comply. Google is still participating in talks with the Canadian government about potential regulations for the act, and while Meta has said that no regulations can change the fundamental issues they have with it, there is a precedent that suggests the company may change course. In 2021, when Australia passed a similar law, Google and Facebook both threatened to pull access to Australian news from their sites. While Facebook did block news for eight days, both companies eventually complied. Between 2021 and 2022, Facebook and Google paid Australian media companies around CAD 1.7 million dollars.
Even if the best-case scenario occurs, there are still questions about which pockets of Canadian media will benefit. While large-scale operations like the CBC, Canada’s public broadcaster, stand to make millions, it’s unclear how much smaller outlets stand to gain. “The act was crafted with a significant amount of lobbying from big outlets,” says Tai Huynh, of The Local, an online magazine that covers urban health in Toronto. “I think the bill itself reflects more of what legacy outlets want than what independent outlets like The Local truly need.” Huynh says that he worries funding from the Online News Act will be tied to the amount of people a news organization employs full-time, a system that disadvantages independent or local outlets who tend to have less full-time staff and rely more heavily on freelancers.
Huynh adds that social media is an important tool for new outlets and startups, as it allows them to reach new audiences for free. While large organizations like the CBC have the budget to create their own apps or circulate their reporting in print in order to weather the current ban, smaller operations that rely more heavily on social media and search engines are the ones that will suffer the most while this all gets hashed out. The long-term effect could be a loss of new independent outlets that fill crucial gaps in Canada’s news ecosystem.
Queer people have long known that tech giants and social media platforms present a double-edged sword. They can provide a vital platform for connection with peers and resources, but they are also companies that have proven to have little regard for the safety and needs of their users, often allowing harassment and hate speech to run rampant. As X (formerly known as Twitter) has become less and less safe, queer users have started diversifying their forums for online connection. Perhaps the current situation with the Online News Act will be an impetus for Canadian media to do the same.
Both Krichel and Ligeti say that their outlets are seeking out ways to connect more directly with their readers in order to lessen their reliance on tech platforms. Krichel says that The Tyee has started experimenting with shifting resources over to other platforms and re-promoting their newsletters as a way to connect with audiences. They’ve also been doing polling to see how people would prefer to find their news.
“The responses I’m seeing are very indicative of the fact that we can rely on our audience to find us. I think oftentimes journalists assume that we have to chase down our audience somehow or find the perfect clever hack to get their attention,” she says. “But the best approach to journalism has always been excellent on-the-ground reporting.
“We’ve just been relying on these platforms for so long to maintain our relationship with our readers. At this moment when the social media bubble is kind of popping, there is no easy silver bullet to solve this problem,” Krichel says. “And what does that say about how we should approach it in the future? We have to find more grassroots approaches to those relationships, especially in this time of extreme natural disasters and other crises. It could not be a more crucial question.”