Google announced on Thursday that it plans to block news links in Canada in response to a new law ordering the tech giants to make payments to local news publishers, a dramatic, though not unexpected, escalation in the battle between the Canadian government and global tech giants.
Media and legal expert Michael Geist called the announcement a “massive own-goal” for the Canadian government, while one prominent media buyer called on advertisers to do more to support local media—the central issue at the heart of the battle.
Kent Walker, president of global affairs for Google and Alphabet, said in a statement on the Google blog that Bill C-18— also known as the Online News Act—is “unworkable.” The so-called “link tax,” requiring the tech giant to pay publishers for featuring their links in search results, creates “uncertainty for our products and exposes us to uncapped financial liability simply for facilitating Canadians’ access to news from Canadian publishers,” he wrote.
The government, meanwhile, contends that the Online News Act will help repatriate some of the millions of dollars that local publishers have lost to Google and Facebook over the past decade, in the form of ad dollars that have followed consumers to the platforms.
In a report last year, the Parliamentary Budget Officer, estimated that the country’s news businesses could expect to receive total compensation of $329.2 million per year from deals mandated by the legislation.
But Walker reiterated Google’s stance that the Online News Act is “the wrong approach” to supporting Canadian journalism. “We’re disappointed it has come to this,” he wrote. “We don’t take this decision or its impacts lightly and believe it’s important to be transparent with Canadian publishers and our users as early as possible.”
Google’s decision follows a similar move undertaken by Meta after Bill C-18 received royal assent last week. In a statement, Meta said that news availability will be ended for all users in Canada on both Facebook and Instagram.
Writing on his personal website on Thursday, Geist, the University of Ottawa’s Canada research chair in internet law, said that the Online News Act constitutes a “massive own-goal” for the Trudeau government, and will have “lasting and enormously damaging consequences” for Canadians.
Geist disputed the government’s claim that the Australian government’s success in instituting a similar law, which came after a standoff that saw Facebook temporarily block Australians’ access to news content, was evidence that its new law would be effective here.
Instead, he argued, it is likely to become a global example of “disastrous government policy that abandoned principles of an open internet, failed to take the risks of its policy seriously, and paid a severe price.”
Reuters quoted a statement from Heritage Minister Pablo Rodriguez, who introduced the bill last year: “Big tech would rather spend money to change their platforms to block Canadians from accessing good quality and local news instead of paying their fair share to news organizations.”
Supriya Dwivedi, director of policy and engagement at the Centre for Media, Technology and Democracy, said that the actions taken by Google and Facebook are part of their “established playbook,” and constitute a “warning shot” to other jurisdictions contemplating laws to reign in big tech, including Great Britain and California.
“If Google and Meta’s response is to pull news from their platforms in every jurisdiction that enacts policy it dislikes, then we need to be having a much more pressing conversation on the role these companies play in our democratic society,” she said.
It’s also a situation that Canada’s media buying community is closely monitoring. In a statement to The Message on Thursday, Sarah Thompson, president, media at dentsu Canada, said that Canadian news and journalism have reached a “critical moment.”
“We can hope that direct traffic to news publishers increases, and Canadians continue to seek out quality journalism in their communities, despite it now being harder to find,” she said. “And we can hope that this doesn’t give rise to disinformation. We must watch how this next stage unfolds.”
Thompson, who has been an outspoken advocate for thoughtful media investment through initiatives like the CMDC’s Canadian Media Manifesto, said that local news continues to offer a viable, brand-safe environment for advertising clients.
“For advertisers, quality journalism in Canada generates the best attention, quality, and trust in context of your brand. And for any brand with an ESG goal, it is important to support an ethical media supply chain and reconnect with communities through their local media publications,” she said. “It is good for your brand, it is good for business, if is good for Canada.”
Google presented its case as a supporter of Canadian journalism through its various programs and partnerships, and said that it is willing to do more. As part of its Google News Showcase program, Walker said, the company has negotiated agreements encompassing more than 150 publications across the country.
Google linked to Canadian news publications more than 3.6 billion times at no charges, said Walker. That helped publishers make money through ads and new subscriptions. He pegged the value of referral traffic from links to Canadian publishers at more than $250 million per year.
“We’re willing to do more; we just can’t do it in a way that breaks the way that the web and search engines are designed to work, and that creates untenable product and financial uncertainty.”
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