The Canadian government has announced that it will cease purchasing ads on Meta platforms, including Facebook and Instagram, amidst an ongoing dispute over a new law. The Online News Act, also known as Bill C-18, was recently passed, mandating tech companies like Meta and Google to pay online news publishers. In response, both Meta and Google’s parent company, Alphabet, have threatened to restrict news access on their platforms in Canada.
Prime Minister Justin Trudeau emphasized the government’s commitment to ensuring that social media platforms and internet giants pay their fair share for media usage. The specific rules for revenue sharing are still being finalized and are expected to be implemented by the end of the year. Despite the disagreement, the government remains open to discussions with Meta and Google to resolve the dispute.
Heritage Minister Pablo Rodriguez, who introduced the bill, highlighted that a significant portion of advertisement revenue in Canada, about 80 percent or nearly CAD 10 billion ($7.5 billion) in 2022, went to Google and Facebook. The government aims to encourage the platforms to contribute to domestic journalism. The suspension of government ads is estimated to cost Facebook and Instagram approximately CAD 10 million ($7.5 million) annually.
Rodriguez expressed disappointment in Facebook’s refusal to discuss compensation for media organizations and stated that the government decided to suspend advertising as a result. Meta has previously argued that news does not hold economic value for the company and that news organizations benefit from sharing their reports on Facebook. The company plans to end news availability in Canada in the coming weeks.
While Rodriguez is more optimistic about reaching a compromise with Google, as the government believes their requests can be accommodated, the regulatory process is viewed as inadequate for addressing the fundamental issues with the legislation. The outcome of Canada’s dispute with internet giants could set a precedent for other governments seeking to regulate these companies. Democratic US Senator Elizabeth Warren expressed support for Canada’s stance against Big Tech’s impact on local news. Additionally, Canadian telecoms operator Quebecor and radio station operator Cogeco have also decided to halt advertising on Facebook and Instagram due to Meta’s opposition to the new law.
