News

In June, Canada passed the Online News Act, also known as C-18. The purpose of this law is to provide financial support to Canadian news publishers by requiring large tech companies to pay for linking to news stories.

The key element of C-18 is the introduction of a bargaining framework that aims to ensure fair compensation for news businesses when their content is made available by dominant digital news intermediaries. The law intends to facilitate balanced negotiations between these news businesses and the digital platforms that promote or share their content.

Currently, there are two dominant digital news intermediaries affected by this law: Google and Meta (formerly Facebook). As a result, C-18 essentially compels these US tech giants to reach agreements with Canadian news publishers when they link to their stories. Under the new law, even providing a simple link to a news story requires payment, despite the fact that it drives traffic to these news sites for free.

Both Google and Meta have reacted strongly to C-18. Google has indicated that it will be forced to remove links to Canadian news from its Search, News, and Discover products in Canada. Additionally, Google will no longer offer its Google News Showcase product in the country. Meta has also begun the process of ending news availability in Canada on its platforms, Facebook and Instagram.

Professor Michael Geist has pointed out that Meta’s response affects all news sites, not just Canadian ones. The law covers any news site whose links are accessed in Canada. It is relatively easy to bypass the blocks imposed by the law using a VPN.

Link taxes, like the one implemented by C-18, have been controversial and have not been successful in the past. Similar laws were implemented in Germany in 2013 and in Spain in 2014, resulting in significant drops in traffic for news publishers. The European Union and Australia have also attempted to make Google and Meta pay news publishers for linking to news stories.

Concerns have been raised regarding the negative consequences of link taxes. Removing links to news stories from major online services limits freedom of speech and access to information. This absence of links from reputable news organizations may lead to an increase in the readership of fake news and misinformation websites.

Furthermore, AI-generated content presents a challenge with regard to C-18. The law covers activities such as reproduction, access facilitation, linking, indexing, and aggregating news content. However, it does not adequately address news generated by AI systems that do not reproduce original text, link to original sources, or index content in the same manner as conventional search engines.

While link taxes aim to address financial challenges faced by the publishing industry, they do not tackle the real problem of online advertising. These taxes fail to acknowledge that tech companies like Google and Meta retain the majority of ad revenue through constant surveillance of site visitors. Instead, news publishers could explore context-based advertising as an alternative that respects visitor privacy and ensures a fair distribution of ad revenue.

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