Canada Tries Price Controls on News

Toronto

If no news is good news, Canadians have cause to celebrate: Google says it will start blocking Canadian news links within the country in the coming months, and Meta is restricting users’ ability to share such links.

It’s a response to the Online News Act, which received royal assent in June. Naturally, the law’s objective is to increase the availability of news. It seeks to establish a “framework through which digital news intermediary operators and news businesses may enter into agreements respecting news content that is made available by digital news intermediaries.”

The act is a heavy-handed response to a real problem. Many news organizations face financial peril because their old business model collapsed under the weight of online competition for both advertising and news. “Digital news intermediaries” like Google and Meta cannibalize news outlets’ work, profiting from it without helping to fund it.

The Online News Act seeks to compel Big Tech to share revenue with publishers. Richard Gringas, Google’s vice president of news, told Parliament’s Canadian Heritage Committee that the act would make Canada “the first country in the world to put a price on free links to webpages, the bill . . . sets a dangerous precedent that is contrary to the long-term interests of the Canadian news ecosystem.” Whatever the merits of that argument, it was backed by real power. Blocking news is much costlier for news organizations than for Google and Meta.

It isn’t too late for Ottawa to learn a lesson from Australia, which in 2021 passed a similar measure, the News Media and Digital Platforms Mandatory Bargaining Code. Facebook responded by blocking news access. Within days, Facebook and the Australian government reached an agreement under which the latter would recognize “commercial agreements” that digital platforms had already established with local news outlets. There would also be a mediation period of up to two months to determine whether the code applied in certain instances.

Since then, “over 30 commercial agreements between digital platforms (Google and Meta) and a cross section of Australian news businesses have been struck,” Australia’s Department of the Treasury noted in a 2022 report, and those included “agreements that were highly unlikely to have been made without the Code.” Ottawa could follow Canberra’s lead by tempering the Online News Act and encouraging voluntary agreements between tech giants and news organizations.

Mr. Taube, a columnist for Troy Media and Loonie Politics, was a speechwriter for former Canadian Prime Minister Stephen Harper.