The federal liberal government introduced legislation on Tuesday, April 5 to force digital giants to compensate news agencies for using their content. The loss of advertising revenue has overturned previous media business models. Thousands of Canadian journalists have lost their jobs and some communities have become “news deserts” – without access to newspapers, digital news sites, television, or radio. A classic news dessert for example is our own Park-Extension where local news is rarely covered by the big media outlets.
The new regulatory regime will require companies such as Google, Facebook and other major online platforms that reproduce or facilitate access to news content — either to pay or go through a binding arbitration process under the auspices of a Canadian regulatory authority. Broadcasting and Telecommunications (CRTC).
The compensation generated by these digital giants should be used to a large extent to fund the creation of news content to protect the “viability of the Canadian news ecosystem”, according to a government background distributed to journalists.
According to government figures, more than 450 news outlets in Canada have closed since 2008. News companies are struggling to make money from their content after losing significant revenue streams, such as ads and print subscriptions.
In the age of wireless, some private and public service broadcasters have also found it difficult to make money from their radio waves and pay for local, regional and national radio and television news.
The dominance of advertising once enjoyed by the old-fashioned media is over. Google and Facebook have a combined 80 percent share of all online advertising revenue in Canada, earning a staggering $ 9.7 billion a year, according to government figures.
Cultural Heritage Minister Pablo Rodriguez said Canada’s news companies should be compensated for helping Google and Facebook attract attention.
“The news sector is in crisis,” Rodriguez told a news conference on Tuesday (April 5th). “Traditionally, advertising has been a major source of revenue for news companies. This is happening less and less. I would say the reality is bleak.”
“Google and Facebook use news content on their sites” without really having to pay for it. With this new law, we are trying to address this market imbalance, “Rodriguez said.
To maintain access to Canadian news, the federal government has adopted much of the so-called “Australian model”, named after the country that first forced digital companies to pay for news content.
The new Canadian system would require Facebook, Google and other digital platforms that have a “negotiating imbalance with news companies” to enter into “fair trade agreements” with newspapers, news magazines, online news companies, private and public broadcasters and broadcasters. non-Canadian media that meet specific criteria.
The goal is for these digital platforms to negotiate agreements with publishers without the need for government intervention. Rodriguez said the amount of money each news company would receive from these digital giants would be decided by these negotiations – there is no set formula. In the absence of any voluntary settlement, news companies can initiate a mandatory negotiation process and apply to a CRTC arbitration panel for a binding decision.