In response to the recently passed Online News Act by the Canadian parliament, Google has made an announcement regarding the removal of links to Canadian news from its search results and other platforms. The act, set to take effect in six months, mandates internet giants like Google and Meta to negotiate agreements with local news organizations and compensate them for their content.
Before implementing the bill, Meta also stated its decision to cease the availability of news for Canadian users on Facebook and Instagram. Despite engaging in discussions with the Canadian government regarding the legislation, both companies deemed the bill “unworkable,” according to Google.
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Kent Walker, President of Global Affairs at Google, expressed concerns about the approach taken to support journalism in Canada, warning of potentially significant changes to their products. He described the “link tax” as creating uncertainty and exposing the company to unlimited financial liability for enabling Canadians’ access to news from local publishers.
The Canadian Heritage Minister, Pablo Rodriguez, who authored the bill, responded to the actions of Google and Meta by accusing them of irresponsibility and being out of touch. He criticized the tech giants for altering their platforms to block news instead of contributing a small share of their substantial advertising revenue.
Australia passed a similar law in 2021, initially leading to Google and Facebook threatening to limit their services. However, after amendments were made to the legislation, both companies ultimately reached agreements with Australian media organizations.
Canadian Prime Minister Justin Trudeau expressed confidence that Google and Meta would eventually comply with the Canadian legislation. However, Google argued that the scope of the law is broader and could apply to platforms that do not generate news content. They emphasized that payment should be based on displaying news content rather than simply providing links, and that eligibility for compensation should be limited to businesses adhering to journalistic standards.
The aim of the bill is to promote fairness in the Canadian digital news market and contribute to its sustainability. The media industry in Canada has long called for stricter regulations on the two dominant internet giants, Google and Facebook, who collectively hold 80% of the country’s online advertising revenue.
According to Canadian government data, Google and Facebook generate $9.7 billion annually from advertising revenue. Under the new legislation, Canadian news organizations could potentially receive approximately $249 million per year from negotiated agreements. However, there is also the risk of detrimental consequences if Google and Meta choose to block their content.
