A controversial piece of legislation is causing division between Canada's mainstream media and independent outlets as it only benefits the former and harms small and upcoming media companies.
Bill C-18, otherwise known as the Online News Act, became law in June of last year. It requires Big Tech companies to compensate media organizations if they want to continue to host Canadian news content on their platforms. Proponents touted the law as the "solution" to the ongoing crisis faced by media outlets.
"It seeks to support balanced negotiations between the businesses that operate dominant digital news intermediaries and the businesses responsible for the news outlets that produce this news content," an explanatory note from the government stated.
However, Canadian lawmakers were unable to get Meta Platforms to believe in their goals. Facebook’s parent company has taken the position that it will eliminate access to news content on its platforms, rather than pay to host it, so Canadians may no longer see it appear on Facebook and Instagram. Instead, audiences will have to seek news out directly from media organizations on their websites and apps, or on other platforms such as X, since the content produced by Canadian news organizations will be blocked by Meta.
Meanwhile, search engine giant Google agreed on a deal worth CA$100 million ($73.14 million) annually, which would become a five-year deal worth CA$500 million ($365.7 million). But the question remains: Who would administer the money? Google has decided to keep things simple for itself – it will negotiate with only one collective and all media outlets that have the right to apply will be represented by it.
According to sources, there are two main contenders. One is the Online News Media Collective (ONMC), which represents some of the biggest players in the industry such as the CBC, the Canadian Association of Broadcasters (CAB) and News Media Canada (NMC).
However, this raised concerns that independent outlets will struggle to benefit from the agreement since they are virtually excluded from the ONMC and the funding rules most likely favor media companies with a larger number of full-time employees.
The other contender is a non-profit, the Canadian Journalism Collective, which is hoping to secure a fair and transparent allocation of money. (Related: Canada's amended Online News Act favors CORPORATE MEDIA.)
Online Streaming Act mandates Netflix, Disney to pay 5% of Canadian revenues
Another law, the Online Streaming Act requiring streaming platforms to pay to support local content, is being rolled out soon. The law is part of a series of recent measures introduced by the government to better "regulate web giants."
The nation's broadcasting regulator said on June 4 that platforms such as Netflix and Disney would be required starting in September to contribute five percent of their Canadian revenues to fund local content.
The law, which was passed in 2023, created a legal framework to regulate digital platforms and oblige them to contribute financially to the creation, production and distribution of Canadian content, such as TV shows, as well as its promotion. The Canadian Radio-Television and Telecommunications Commission (CRTC) estimated that the measure, which effectively brings streamers under the same rules as traditional Canadian broadcasters, will provide CA$200 million ($146.28 million) per year in new funding for the country's broadcasting system.
"The funding will be directed to areas of immediate need in the Canadian broadcasting system, such as local news on radio and television, French-language content [and] Indigenous content," the CRTC said in a statement. Online streaming services will be permitted some flexibility to direct parts of their contributions to support Canadian television content directly, it added.
The Digital Media Association (DiMA) – which represents Amazon Music, Apple Music and Spotify – pushed back against the measure. "We are deeply concerned with today's decision to impose a discriminatory tax on music streaming services that are already making significant contributions to Canadian artists and culture," DiMA president Graham Davies said in a statement.
"We are disappointed in today's decision that reinforces a decades-old regulatory approach designed for cable companies," Motion Picture Association-Canada President Wendy Noss said.
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