Cape Breton Post

Publishers urging web giants to pay for licensed content

- JOANNE LAUCIUS POSTMEDIA NEWS

Canadian print and online publishers are urging the federal government to follow Australia’s lead in demanding that Google and Facebook compensate news companies for their content.

In a report released Thursday, News Media Canada recommends a model similar to Australia’s proposed News Media Bargaining Code, which would require Google and Facebook to license content.

Demand for high-quality journalism continues to grow, but there is no current mechanism to make Google and Facebook pay when it uses content on its platforms. The tech giants also control between 60 and 90 per cent of the digital advertisin­g market, giving them market power to “impose unfair and anticompet­itive terms on news publishers,” the report says.

Facebook and Google are “cutting off our oxygen supply,” said Jamie Irving, vice-president of Brunswick News Publishing and the chair of the News Media Canada working group tasked with studying the issues.

“They’re taking all of the money, but they’re not hiring journalist­s. And they don’t have any of the costs publishers have to pay,” he said.

The report reflects a growing internatio­nal backlash against the dominance of the two tech behemoths. France, Spain, the UK and the U.S. have also moved to regulate Google and Facebook to level the playing field for local news organizati­ons.

On Tuesday, the U.S. Justice Department and 11 states filed an antitrust lawsuit against Google.

If the Australian code were adopted in Canada, it could permit publishers to recover $620 million in annual revenues as compensati­on for supplying news content, said the report, which estimates Canadian publishers face revenue declines of between between $500 and $600 million a year between 2019 and 2023.

“The industry needs a level playing field so that participan­ts can define their future based on their merit,” said Andrew Macleod, president and CEO of Postmedia Network, which includes this newspaper.

Google and Facebook have an “effective duopoly” for digital ads, with Facebook in control over social media and Google is control over searches, said the report. Google also controls the technology through which advertiser­s that are looking to buy digital ads are connected to publishers that are selling.

For every digital ad sold, an estimated 49 cents goes to the platform, leaving 51 cents for publishers, said the report.

The two platforms can also access publishers’ audiences and content without transparen­cy or fair compensati­on.

Under the Australian model, the government could order platforms and publishers to negotiate and set fair market prices for licences. That includes a rule allowing publishers to collective­ly bargain, with an arbitratio­n process if there is no voluntary deal.

“By working collective­ly, we can’t get picked off one by one,” said Irving. “The only chance we have is to stand together on this.”

The Australian code would require digital platforms to disclose publishers’ data on their audiences, a matter that has been a key sticking point with publishers.

The platforms would also be prohibited from taking retaliator­y measures against publishers, such as blocking content. If Google or Facebook removes the content of one publisher, they must remove all news content in Australia or face fines.

A dozen different models of pursuing compensati­on from Google and Facebook were considered, including taxation models, said Irving. But there’s already enough money in the system. The problem is that Google and Facebook are scooping it all up, he said.

“We think the Australian government is taking the right approach. We’re asking to government to take a hard look at this. Australia has already done a lot of the legwork.”

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