Google and federal government have settled their dispute regarding the Online News Act, according to sources familiar with the matter who spoke to Radio-Canada and CBC News. The agreement involves Google making annual payments to Canadian news companies, estimated to be around $100 million.
This development follows earlier government estimates that Google’s compensation should be about $172 million, while Google had valued it at $100 million. An unnamed source emphasized the significance of this agreement with Google, stating, “It is one more solution to ensure the viability of the media and restore a balance between commercial platforms.”
The agreement simplifies the negotiation process, which had been a point of contention for Google. The company had previously expressed concerns over “critical structural issues” with the Online News Act, also known as Bill C-18. Google had opposed a mandatory negotiation model for talks with Canadian media organizations, preferring instead to negotiate with a single representative group.
Under the new regulations, which will be incorporated into the C-18 legislative framework expected by mid-December, Google will be able to negotiate with a single entity representing all media. This arrangement reduces the company’s arbitration risk.
While Google is still required to negotiate and sign agreements with the media, it may also offer additional service contributions, details of which are yet to be specified.
Google had threatened to block Canadian news content on its platforms in response to the legislation. However, unlike Meta, which ceased distributing Canadian news on Facebook and Instagram last summer, Google has not implemented a news block in Canada.
The government’s apparent concession to Google’s demands has been viewed by some as a softened stance in the face of the company’s threat to stop distributing Canadian news. However, a government source described the agreement as a victory and a net gain for Canadian media, suggesting that the framework for a single negotiation could set a precedent for other countries.
Back in October, the feds proclaimed they would “not back down” versus Google in regards to this online news fight. But it seems that has changed.
Bill C-18 targets digital platforms with at least 20 million unique monthly users and annual revenues of over $1 billion, criteria currently met only by Meta and Google. Talks between Meta and the federal government have not resumed.
The CBC points out it stands to benefit financially from C-18, which mandates an annual report on compensation received from digital operators for news content.
“This has been rumoured for the past few days in Ottawa. Government provided the sector a bailout to make up for the Meta disaster and tosses aside key commitments to get a deal with Google on Bill C-18. No deal would have been bad for all,” reacted University of Ottawa Law Professor, Michael Geist to the news.
He noted it “was clear for months that government and industry desperately needed to salvage something from Bill C-18. No deal would have been bad for everyone. The $129M bailout cushions Meta blow and this deal suggests government traded tough talk for compromise.”
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Google shouldn’t have backed down. It’s completely asinine to expect a company to pay failing companies for the privilege of providing a free service to them. This is the Trudeau forcing a successful company to pay off his friends.
Not questioning your original premise but how do you imagine Trudeau, or more accurately the federal government, managed to force such a behemoth to do anything, let alone part with $100 mil. of their own money?
Forced the choice on them of crippling their user functionality for Canadians (as Facebook chose) or pay Canadians companies for the privilege of giving them free stuff.
Each had to pick the one of the two bad options forced them.
So basically Meta can allow to have their users experience crippled and they can afford whatever damage to their business comes from it – while Alphabet cares about their customers more, even at the cost of paying extortion?
Oh look another revenue stream for Trudeau to mismanage.
Don’t worry. MST, media service tax, coming soon for all streaming services to make up for this nonsense.
Please resign, Justin, and stop making fun of people’s glasses….hahaha
I wonder why they caved
My guess is that they decided they’d rather pay extortion than to cripple their users’ experience.
Alternatively or in addition, they determined that not paying would hurt their business model more than paying the extortion.
Same choice any business faces when confronted with an extortion racket…which of these two very bad choices do you prefer? Some take the broken legs, some make the payoff.
Difference being that in real case of extortion the business that refuses to pay can’t just put a padlock on the shop and leave because they will lose the entire business while Alphabet can easily shut down that very small (according to them) portion of their operation and safely continue with their business. Nobody will come after them or break their legs. They don’t lose much, they don’t risk much harm to them. I don’t believe they have a soft spot for their users to the tune of $100 mil.; it’s more likely that it made more sense for their business to pay and see it as a cost of doing business.