Heritage Canada cuts digital ad budget

Move targets Facebook, Google

In a shot across the bow to Google and Facebook, Heritage Minister Steven Guilbeault said Monday he is reducing how much his department spends on digital advertising.

Guilbeault told MPs on the House heritage committee on Monday that there has been a trend of more federal money going into advertising on digital platforms. In response to a question about federal government spending on digital ads, Guilbeault said too much has been going to online platforms and “we need to change this.”

“We have started to change the investment we made in publicity away from online platforms,” he said.

The minister's office later clarified Guilbeault was speaking about Heritage Canada's advertising spending only.

Guilbeault said that change will be reflected in the government's advertising spending figures for this year.

Last year, 55 per cent of the $44.86 million the federal government spent on advertising went to digital platforms. Of that money, Google received 93 per cent of the total spending on search engine marketing media placement, or $4.27 million. Facebook and its Instagram platform received the lion's share — $5.85 million — of the $8.56 million the government spent on social media placement.

The federal government is in the process of a multipronged approach to begin regulating and taxing such digital giants as Facebook and Google. That includes upcoming legislation to force large digital platforms to compensate news outlets for their content, something both companies strongly opposed when legislation was introduced in Australia.

“I think you can say that there's this clash between their policy agenda and their spending receipts,” Carleton University professor Dwayne Winseck said.

Winseck, whose research has shown Google and Facebook account for 80 per cent of online ad spending in Canada, noted that figure has risen from two-thirds of spending five years earlier. Google and Facebook now account for about 45 per cent of all Canadian advertising spending.

“Trying to redirect some government advertising from the digital duopoly back to other media, it reflects a legitimate attempt, I think, to counter the trend towards consolidation,” he said.

Winseck noted the proportion of government spending on digital platforms is about in line with Canadian advertising spending in general, but it's disproportionate to how much time people are spending on various forms of media, given statistics from the United States and Australia that show audiences as a whole “spend twice as much time on television and radio as they do online.”