Canada’s Attempt to Make News Aggregators Pay for Content Could Lead to Lower-Quality News
The Canadian House of Commons held a hearing this week to discuss C-18, a bill that would force online news aggregators like Google and Facebook to pay news publishers for displaying their stories. This is a flawed approach on a number of fronts. History proves that the news industry does not need handouts from aggregators in order to survive and adapt to the modern era of online news. Additionally, the language of C-18 could lead to lower-quality news results for Canadians.
Canada is not the first country to consider taking this approach to news aggregators: online services that display snippets and preview images of news stories from other sources, with links to the publisher’s website if users want to read the full story. Multiple European countries have considered or passed “link taxes,” requirements that online news aggregators pay copyright fees to news publishers they link to. Largely, these attempts were each unsuccessful. It is also worth noting that these link taxes, like C-18, are designed to protect news publishers in those countries while targeting news aggregators that are, for the most part, American companies.
In Belgium, a proposed link tax led Google to de-index Belgian articles from Google News to avoid copyright fees. In Germany, Google responded to a link tax by changing Google News from an opt-out to an opt-in system for German publishers and stopped displaying news snippets and preview images in the country, leading to decreased traffic to Germany’s largest publishers. When Spain passed a link tax, Google stopped offering Google News in Spain, again leading to decreased traffic. The reason is clear: in these cases, it was Google that was providing value to the publishers in terms of increased views, not the other way around.
So far only two countries have managed to successfully force aggregators to pay for news content. In France, Google once again announced it would stop displaying news snippets and preview images unless publishers agreed to provide them for free, but France’s Competition Authority ordered Google to reinstate snippets, negotiate with publishers, and pay publishers retroactively for all the content it had linked to since the law went into effect.
Outside Europe, Australia passed its News Media Bargaining Code in February 2021. This mandatory code of conduct forces aggregators to reach a deal with publishers on payment for linking to their stories. Facebook initially responded to the bill by taking down news pages in Australia but restored them after the Australian government made a few changes to the bill that would take into account aggregators’ existing deals with publishers.
C-18 and similar bills and laws in other countries—including the Journalism Competition and Preservation Act, a bill introduced in the U.S. Congress—are based on the false premise that governments need to level the playing field between news aggregators and news publishers. Lawmakers ignore the benefits that publishers get from having their stories linked via news aggregators: namely, increased traffic, which leads to increased advertising and subscription revenue. After Google News switched to an opt-out system in Germany, overall traffic to Germany’s largest publishers decreased 40 percent. After Google stopped offering Google News in Spain, traffic to Spanish publishers fell by over six percent, and traffic to smaller publishers fell 14 percent.
Aggregators also benefit consumers by making the vast, diverse world of online news easier to navigate. A survey conducted by Abacus Data, commissioned by Google Canada, shows that this is one of consumers’ main concerns with C-18: They don’t want it to change the way search engines like Google News work. This is exactly what C-18 would do in its current form. It prohibits aggregators from “disadvantaging” any eligible news publisher. This would prevent aggregators from preferencing news content from reliable sources over less trusted sources, including foreign state-owned news outlets and other potential sources of misinformation and disinformation, since eligibility does not require publishers to follow journalistic standards. Google and Facebook could find themselves subsidizing websites that peddle low-quality clickbait rather than directing users to reputable news sources.
The current state of online news benefits everyone involved. News publishers get increased traffic from news aggregators; consumers get easy and often free access to countless trusted news sources (and sometimes sign up to be subscribers); and yes, news aggregators do make money from providing their services. Forcing aggregators to pay publishers for content breaks a system that already works, favoring publishers over everyone else, including consumers.
