Wait, you mean that wasn’t the plan? It must have been, if you judge the plan by the amazing results:
The damage caused by the government’s Bill C-18 continues to grow as Meta has started to cancel its existing agreements with Canadian publishers. The move should not as a surprise since any deals that involve facilitating access to news content would bring the company into the legislative framework and mandate payments for links. Indeed, Meta said earlier this week that its 18 existing deals “did not have much of a future“. When this is coupled with a reported “impasse” between the government and Google over its approach to Bill C-18, the risks to the Canadian media sector look increasingly dire.
This was entirely foreseeable, yet Canadian Heritage Minister Pablo Rodriguez never seemed to take the risks seriously. It raises the question of whether the government developed estimates of the cost of its legislation if Meta and Google chose to comply by stopping news sharing or linking. While there were estimates for the benefits of new deals that ran into the hundreds of millions of dollars, did it conduct a risk assessment of the economic costs that would come from Internet companies exiting the news market in Canada?
There are obviously costs that extend far beyond the economics that include reduced access to news, increased prominence of low quality news sources, harm to the Canadian Internet, and the reputational damage to a government that handled this about as incompetently as possible. But from a pure economic perspective, the risks were always understated as they extended beyond just the value of increased traffic to publishers from the links they were themselves posting. Both Google and Meta have deals with Canadian publishers reportedly worth millions of dollars. As Meta’s step to begin cancelling deals suggests, those agreements are unlikely to survive the decision to exit news in Canada.
And of course, Google doesn’t want to set any kind of precedent by accepting a shakedown from any two-bit hoodlum country like Canada:
The worst case scenario for Canadian Heritage Minister Pablo Rodriguez, the Canadian news sector, and the Canadian public has come to pass: Google has announced that it will block news links in Canada in response to the mandated payment for links approach established in Bill C-18. The decision, which the company says will be implemented before the law takes effect, will cover search, Google News, and Google Discover. The decision – which government seemingly tried to avoid with last minute discussions with Google executives after it became apparent that the risks of exit were real – will have lasting and enormously damaging consequences for Canadians and represents a remarkable own-goal by Rodriguez who has managed to take millions away from the news sector and left everyone in a far worse position than if he had done nothing at all.
If you’re in any way interested in Canadian government … machinations … when it comes to digital policy, you really should be following Michael Geist‘s reporting. He’s been doing a great job and deserves the support.
That the federal govt of Canada has a minister names Pablo Rodriguez says all that needs to be said about the sorry state of Canada.
Comment by MBlanc46 — July 1, 2023 @ 19:15