News stories published by Canadian media outlets will soon disappear from Google search results, the digital giant warned Thursday as it revealed its planned response to the Liberals' online news law.
The California-based company also said it would end existing deals with local news publishers over the newly passed legislation, which will force global tech players to compensate Canadian outlets for content they share or otherwise repurpose on their platforms.
Google did not say exactly when the changes will happen, but it will be before the Online News Act, formerly known as Bill C-18, comes into force by the end of this year.
The company said the block, which will also involve links on Google News and Google Discover, will apply only to Canadian publishers. Canadian users will still be able to find news produced by international outlets such as the BBC, the New York Times and Fox News.
The company said it will also end Google News Showcase in Canada, a product it uses to license news from over 150 local publishers. Those existing deals will stay in place until the change happens later this year.
"Once the law takes effect, we wouldn't anticipate continuing the agreements," said Kent Walker, president of global affairs for Google and its parent company Alphabet, in an interview Thursday.
"We won't have a news product to be able to feature, (and) the agreements are premised on the ability to showcase Canadian news."
Walker said he told Canadian Heritage Minister Pablo Rodriguez of the decision n a letter sent early Thursday morning.
Rodriguez said Thursday that Google made an "irresponsible" decision.
Walker said Google has begun briefing federal, provincial and regional authorities "just to make sure they're aware of all the Google tools at their disposal to get the word out as they need to for crisis response, (and) forecasting other circumstances."
He said Google will continue to create resources for government agencies to use in those situations.
"We want to stress this change won't affect the SOS alerts we use to surface safety information during crisis situations, like the fires (in Canada) or floods or earthquakes," Walker said.
Meta announced last week it will also be removing news in Canada from its Facebook and Instagram platforms before the law is in force.
It is already running a test to block news for up to five per cent of its Canadian users.
Meta is also ending existing deals with local publishers. That includes a contract for a fellowship program that supports the hiring of a limited number of emerging journalists at The Canadian Press.
"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," Rodriguez said.
The Online News Act requires both companies to enter into agreements with news publishers to pay them for news content that appears on their sites if it helps them generate money.
The act aims to create new government oversight for digital giants who dominate the online advertising market.
The Liberal government views Meta and Google's dominance on the internet, and their decision to remove news, as a threat to Canadian democracy at a time when the news industry continues to face cuts due to declining ad revenue.
Since 2008, nearly 500 newsrooms have closed across the country, Rodriguez said.
Walker said the law is unworkable because it puts a price on links, resulting in an uncapped financial liability "that no business could accept."
"I think we need clear financial expectations, and we need a clear and realistic path toward exemption that takes into account our commercial agreements and the other support we provide for news in Canada," Walker said.
While the bill was being debated in Parliament, Google called for lawmakers to consider alternative ways to support news, such as creating a fund for journalists.
Google had also been seeking assurances about how much the changes could cost the company, and how the bargaining process will unfold. Those details are likely to become clear after the bill's regulatory process is complete.
News Media Canada, which advocates for the domestic news industry, urged all stakeholders to "act in good faith" and engage in the regulatory process.
"We believe there is a viable path forward," said Paul Deegan, the group's president and CEO, in a statement.
Earlier this week, Rodriguez told The Canadian Press he is hopeful the government will come to a positive resolution with both Meta and Google to prevent them from blocking access to news through their platforms.
Rodriguez also said the government will continue to support newsrooms, though he did not say exactly how that will be done.
"The effort to find a solution feels genuine, but unfortunately we don't have the assurances we need to create financial certainty or product certainty, but we do hope that changes," Walker said.
"We hope the government can work through the details. It's their bill, they know it best, so we'll have to wait and see how the regulatory process unfolds, what the government comes forward with, and see if there's a satisfactory outcome."
This report by The Canadian Press was first published June 29, 2023.
Meta ends contract for journalism fellowship
program as Bill C-18 fallout continues
Digital giant Meta is terminating the contract for a fellowship program that supports the hiring of a limited number of emerging journalists at newswire service The Canadian Press
The move comes amid fallout from the federal government's Online News Act, formerly known as Bill C-18, which became law last week.
The law requires tech companies such as Facebook parent Meta and Google to negotiate deals compensating media outlets for news content they share or otherwise repurpose on their platforms.
Meta has threatened to block access to Canadian news on their sites in retaliation.
Canadian Press president Malcolm Kirk says Meta told the newswire agency that the Online News Act has a negative affect on Meta’s position in Canada to operate some products.
The Liberal government's Online News Act is intended to help preserve Canadian journalism at a time when newsrooms are struggling to compete for online advertising dollars.
This report by The Canadian Press was first published June 29, 2023.
Canadian lawmakers are locked in a dispute with internet technology companies over a law that would compel them to pay news publishers for content, years after a similar regulatory saga played out in Australia.
On Thursday, Google followed Meta in announcing plans to block news for Canadian users now that the Online News Act has become law. It is expected to take effect later this year.
Google spokesperson Zaitoon Murji told BNNBloomberg.ca in an email that the company made the “extremely difficult decision” to remove Canadian news links from its search, Google News and Google Discover platforms, calling its issues with the legislation “unworkable” and unlikely to be resolved through regulations.
“We’re disappointed it has come to this,” Murji said. “None of our suggestions for changes to C-18 were accepted.”
After Google’s move on Thursday, Heritage Minister Pablo Rodriguez sent a written statement calling the companies’ moves “deeply irresponsible and out of touch … especially when they make billions of dollars off of Canadian users” with advertising.
Australia’s regulatory experiment – the first of its kind in the world – also got off to a rocky start, but it has since seen tech companies, news publishers and the government reach a middle ground.
Canada can learn some lessons from Australia’s story, but experts who spoke with BNNBloomberg.ca cautioned that different economic, political and geographic realities could lead to a different outcome.
WHAT HAPPENED IN AUSTRALIA?
In both Australia and Canada, governments introduced legislation aimed at forcing online technology companies like Google and Facebook parent Meta into agreements to pay news producers for content shared on their platforms.
Tech companies opposed the laws in both cases.
Rob Nicholls, associate professor of regulation and governance at the University of New South Wales, explained in an email that in Australia, both Meta and Google threatened to leave the country if the law came into effect.
Google “did not change its local policies dramatically,” he said, but it does now follow a different product schedule from the U.S.
Facebook cut off access to news temporarily in 2021 in response to the legislation. Nicholls noted that it also blocked access to other pages such as health departments and charities, prompting threats from the Australian health department to pull advertising – an idea floated on Twitter by Canadian legislator Anthony Housefather in response to Meta’s latest moves here.
After a week, both Facebook and Google entered in to negotiations with news businesses in Australia and since then, the law has never had to be enforced.
The Australian government has since declared its News Media Bargaining Code “a success to date” in a December 2022 review of its first year in effect, pointing to more than 30 commercial agreements between tech companies and news producers.
Nicholls said there has been an estimated A$150 million in annual revenue from the law – though that fell short of what those in the media businesses wanted. There have also been concerns raised that smaller outlets have been shut out from receiving funds.
WHAT’S CHANGED: GEOGRAPHY, FINANCES AND THE PASSAGE OF TIME
Nicholls said geography – the proximity between Canada and other markets – is one major difference from the Australian context.
“Australia is a long way from other Meta and Google operations – there is no land border to the South,” he said.
Gavin Adamson, an associate professor in digital journalism at Toronto Metropolitan University, also said Canada’s closeness to the U.S. “adds a complication,” because tech companies “wouldn't want to be in the position to start negotiations to pay news agencies in a country with a vastly bigger media network.”
Michael Geist, Canada research chair in internet and e-commerce law at the University of Ottawa, said another factor that has changed from the Australian context is the financial situation tech companies now find themselves in. Meta has been focused on cutting costs in its “year of efficiency,” and it may be “less willing to cut big cheques that don't give the company much value.” Google has also made job cuts this year in the face of similar tech industry headwinds.
There is also a slight difference between the two laws. In Australia, the government has more of a say in who the law would apply to, and in Canada the CRTC makes the final call, which has the companies concerned about the process, Geist added.
Regulations are the last option to find middle ground, Geist said, but Meta and Google have both said they don’t believe regulatory tweaks will be enough to halt their plans.
Google said it hasn’t received assurance from the government that its primary concerns – forced payment for links and “uncapped financial liability” – will be resolved.
GOVERNMENTS VS BIG TECH
Beyond the issue of supporting news producers, the situation also highlights the difficulty governments face when it comes to reigning in powerful big tech companies.
Heritage Minister Pablo Rodriguez invoked that dynamic in a statement to BNNBloomberg.ca on Thursday.
“The Online News Act levels the playing field by putting the power of big tech in check,” he said in an emailed statement.”
“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.”
The companies and the Canadian government both have a lot on the line when it comes to the law, Geist said.
For Meta, it’s an opportunity to send a signal to other governments about regulations they will tolerate, and that’s one reason Geist does not think Meta will back down from its threats.
“They would really lose pretty much all credibility with other countries at this stage if they walked away,” he said.
Meta’s decision was predictable, Geist argued, as the company had long threatened to remove links in light of the pending law. But “the Google response was always more uncertain,” he wrote in a Thursday blog post, because “it values news in a way that Meta does not.”
“Meta pointed to data demonstrating that news contributed little to user news feeds and that was highly substitutable. By contrast, Google search results are its bread and butter and removing Canadian news results makes its flagship product undeniably worse,” Geist wrote.
“That surely presented an unwelcome choice either way: agree to flawed legislation that creates a dangerous precedent on paying for links or knowingly decrease the value of its own service.”
The federal Liberal government has “backed itself into a corner” with its positioning on the law, he noted in Monday’s interview, because they went ahead with their plan despite having other options to help the news sector. If tech giants pull news, news publishers would take a significant financial hit, he added.
“Both their policy measures and the government's own credibility on this is at stake,” he said by phone.
Adamson pointed to mounting “bad PR” when it comes to the tech companies’ corporate citizenship, and said companies “have to see the benefits of a strong democracy and with that included a healthy media ecosystem.”
“That includes a bit of a financial hit, but it also boosts your financial outlook from a social governance perspective,” he told BNNBloomberg.ca in an email. “If I was the government, I would just keep underlining that point.”
WHAT HAPPENS NEXT?
Rodriguez told the media this week that the government will offer unspecified support for news producers should Meta and Google block local news. The government on Thursday said it was working with Google to get clarity on its next steps.
Google spokesperson Murji said the company is “concerned” about how the law could reduce access to news in Canada, and it plans to participate in the regulatory process.
“We hope that the Government will be able to outline a viable path forward,” Murji said.
Nicholls said the threats by both Meta and Google are “credible,” and both companies could feasibly follow through.
Adamson said he expects a “political stand-off” between the companies and the government for the next little while.
“I would still be surprised to see Alphabet and Meta back out of Canada altogether with respect to news content on their platforms but it's hard to know,” he said.
Geist, meanwhile, said he disagrees with those who sees Meta’s repeated threats to pull news as a bluff.
“Part of their goal may now well be to make it clear it was not a bluff,” Geist said.
If news is pulled from online platforms in Canada, he said advocates may stop pushing the Australian model for making tech pay for news, and Canada could become a cautionary tale for what can go wrong.
“We may end up with others saying ‘Don't be like Canada,’ where you find major social networks cutting off news within the country.”
