Google fund favours written media

Two-thirds of $100 million will go to online outlets and newspapers with full-time journalists

The federal government has outlined how its $100million news deal with Google will be broken down, ruling that broadcasters — particularly the CBC — will get a lower share of the cash, with written media receiving twothirds of the funds.

Ottawa on Thursday published the final regulations that will determine how the Liberal government’s contentious Online News Act will be implemented.

Under the regulations, the amount broadcasters are expected to receive will be capped at $30 million, while CBC can get no more than $7 million.

The remaining $63 million will go to other forms of news content, like online outlets and newspapers, and will be distributed based on how many full-time journalists are employed by each news business — as long as those news outlets make their content available online.

Government officials, speaking on background during a technical briefing, said smaller-sized outlets could receive roughly $17,000 for every full-time journalist they employ.

The federal government passed the Online News Act, previously known as C-18, earlier this year in an attempt to end tech giants’ dominance of the digital advertising market, which Ottawa has argued is pulling revenues away from Canada’s embattled journalism industry. It compels tech titans of a certain size to compensate news businesses for sharing news content online. The legislation is set to come into effect Dec. 19. (Torstar, which publishes the Toronto Star, was in favour of the legislation.)

Both Google, and Facebook’s Meta — which responded to the legislation by blocking domestic and international news for Canadians on Facebook and Instagram so that it did not have to comply — had argued the law would unfairly force them into unclear payment deals for driving key traffic to news outlets, generating revenue for publishers in the process.

Last month, the federal government struck a deal with Google that would see the global search giant contribute $100 million a year, indexed to inflation, to Canadian news outlets. The number is lower than the $172 million the government initially estimated. A Google source told the Star that the agreement was reached just hours before the company was planning to remove Canadian news from its search engine, after Ottawa came forward with proposals to address some of Google’s concerns.

On Thursday, the company said it still believes the legislation is “fundamentally flawed,” but was pleased by the final rules.

“Fortunately, this means we will be able to continue sending valuable traffic to Canadian publishers and Canadians will be able to continue enjoying the Google products they know and love while we work through the exemption process,” a spokesperson said in a statement.

The government had previously signalled that CBC — which employs a significant portion of journalists in the country and as such, was set to receive about a third of the funds — would get less money than initially estimated.

The broadcaster, which is publicly funded, offered a tepid response to Thursday’s news, saying the funding would help the country’s beleaguered news sector.

“It is also important that the regulations recognize that the news provided by CBC/Radio-Canada has value and should also receive compensation,” the public broadcaster said.

The Canadian Association of Broadcasters, meanwhile, took issue with the $30 million earmarked for non-profit and for-profit broadcasters.

“The division of funds outlined in the regulations released today does not align with each sector’s respective investment in news, nor with Canadians’ patterns of consumption,” wrote the organization, which represents private broadcasters.

Heritage Minister Pascale StOnge told reporters that even though a third of Canada’s journalists work in broadcasting, not all of them create content for online platforms.

The National Ethnic Press and Media Council of Canada also expressed concern that the final regulations would leave “ethnic media to fend for themselves,” because of criteria that freezes out businesses that primarily rely on part-time staff.

News Media Canada, the group representing Canada’s print and digital outlets and a longtime supporter of the legislation, said it looked forward to “a positive, mutually beneficial commercial relationship with (Google) for many years to come,” and called on Meta to follow the search company’s lead.

Meta said Thursday it was holding strong in continuing to ban news content for Canadians on Facebook and Instagram.

So far, Google and Meta are the only two companies targeted by the law because they bring in a global revenue of $1 billion or more per year, they are search engine or social media platforms that share and provide access to Canadian news, and they attract 20 million or more monthly unique visitors from Canada.

Google now has six months to notify the Canada Radio-Television and Telecommunications Commission (CRTC) that it is officially subject to the law, although it likely won’t take the company that long.

Then, individual news businesses, or a collective representing multiple news businesses have two months to respond.

It’s expected that Google will choose to go with a single collective that represents interested news businesses, which will exempt it from the law. The collective can either be a new organization created by the businesses or an existing one, that will negotiate with the platform and decide how to distribute the money fairly.

The Liberals had already tasked the CRTC, an independent regulator, with overseeing the implementation of the law to avoid criticisms that the federal government was interfering in the production of Canadian journalism.

The regulations underline that platforms cannot take any “retaliatory action in response to an editorial decision, restrict journalistic independence, or intervene in editorial processes.”