DispatchPress Freedom News

Google to pay $100 million annually to Canadian news organizations

The standoff between the Liberal government and Facebook is set to ratchet up in December when Bill C-18, the Online News Act, comes into force.

Meta’s Facebook has already blocked access to news providers from its site, and Google was threatening to do the same.

However on Nov. 30, the Liberal government announced a deal with Google in which the tech giant will pay $100-million annually to Canadian news organization.

The Online News Act lays out a framework that requires Google and Meta to develop agreements with Canadian news sites to compensate for sharing their journalistic content on their platforms.

Some online publishers have worried that boycotts from Facebook and Google would deprive them of readers, though many are eager for the revenue they would reap as a result of the legislation.

NewsMedia Canada estimated that, based on available data, Google could have faced payments to news publishers of $172 million per year. The agreement with the federal government caps that at $100 million.

Facebook’s parent company Meta would be responsible for about $62 million to comply with the terms of the legislation, according to NewsMedia Canada.

The social media platforms have been reducing their users’ exposure to news across the world, reports media analyst Howard Law in a recent MediaPolicy.ca post.

The number of Facebook and X (Twitter) referrals of reader traffic to top global news sites fell sharply between August 2020 and August 2023, according to numbers tracked by Axios and cited by Law. Such referrals fell from 55 million in 2020 to 22.6 million in 2023, while Facebook’s decline was even more dramatic, from 120 million to a mere 21.4 million.

The Axios review does not include Google, which is a lynchpin in the market connecting curious consumers with news sites.

Still, these numbers suggest that once the dust clears on Bill C-18, Canadian news organizations will see permanent changes to their marketplace – one in which they can rely less on the social media platforms to distribute content and draw in potential subscribers.

NewsMedia Canada’s projection of the revenue stream that would result from Bill C-18 will also have to be revisited.

For an industry that has been struggling to find a sustainable business model, the decline of social media presence highlights yet another challenge.

The editor of the Narwhal news site, Emma Gilchrist, says the online publication has yet to feel the impact of C-18 or its fallout as Meta and Google respond.

Narwhal receives government subsidies but Gilchrist says it primarily relies on subscribers for support. However, Google in particular is critical for people to be able to discover Narwhal’s work.

“Facebook has been gradually turning off the taps for news over the course of several years,” she said. “If we lost Google, it’s going to be another story though.”

Law pointed to another concern as Facebook downgrades news.

“Facebook will no longer balance its distribution of misinformation in Canada with reliable news and therefore will devolve into a platform – if you will excuse the hackneyed phrase – for fake news,” he wrote.