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LILLEY: Feds tell tech giants to pay for news content or face fines

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The Trudeau government’s message to Canada’s tech giants: Start paying news publishers, or we’ll make you.

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On Tuesday, the government unveiled its plan to bring together Canada’s news media companies and players like Google and Facebook to reach agreements on payments for use of content or face arbitration.

After considering a number of options, including a heavy tax and regulation plan, the Liberals decided to go with something akin to the Australian model.

Last year, the Australian government introduced legislation requiring tech companies to pay for news content. The move saw deals signed with publishers large and small, resulting in hundreds of millions of dollars being paid to journalism organizations.

In Canada, Google and Facebook account for approximately 80% of all online advertising revenue. Introducing his bill, Heritage Minister Pablo Rodriguez said Canadians often consume their news through social media platforms, consuming content that these companies have not paid for.

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“They continue to enjoy sharing and distributing Canadian news content without really having to pay for it. So with this bill, we seek to address that market imbalance,” Rodriguez said.

Executives at several tech companies – speaking on the merits – said they weren’t happy with the legislation, but that’s about what they expected. It’s also better than what they expected to happen when Steven Guilbeault was in charge of the heritage file.

Under Guilbeault, the government had considered options that included far more regulation and a direct tax on companies like Google and Facebook that would then be redistributed to news publishers.

While this plan has a lighter touch than what was envisioned before last September’s election, it still leaves a bad taste for some on the tech side.

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“It’s still legislation,” said a tech executive.

Others complained about what they called a lack of consultation on the content of the bill. While news publishers haven’t backed the idea of ​​a direct tax on tech giants being redistributed to them, the industry is, in general, supportive of the move.

Andrew MacLeod, president and CEO of Postmedia, the newspaper’s publisher, said the government’s proposal was fair.

“We are very pleased with this result,” said MacLeod. “I think this is a turning point for our industry.”

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News Media Canada, the industry association for news organizations in Canada, also provided support.

“This legislation levels the playing field and gives Canada’s news publishers a fair chance and does not require additional taxpayer funds,” said Jamie Irving, President of News Media Canada.

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The legislation would give the Canadian Radio-television and Telecommunications Commission (CTRTC) the power to oversee negotiations, enforce arbitration and even impose $15 million a day penalties on tech companies that fail to comply . Given the Australian example, there’s a good chance companies on both sides will quickly negotiate the terms and stick to the deal, but handing the responsibility to the CRTC is worrying.

This is an organization with no experience with print or online news publishers and as someone who has spent over 20 years working with and for broadcasters under the CRTC mandate, I can confidently say that they don’t do a good job on the broadcasting side.

A purely private solution where news publishers and tech giants strike mutually beneficial deals would have been preferable. That didn’t happen, however, so the government acted.

I commend the Liberal government in general, and Rodriguez in particular, for going against their own instincts and putting a lighter touch on their regulatory regime. What the government has proposed is not perfect, but it is better than nothing and better than previous Liberal plans.

It also gives small publishers the same support as large ones like Postmedia. In a world where we need more voices in the media – not less – that’s a good thing.

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