Here we go again. It’s a plan that almost never works, but one that legislators and special interest groups believe will be showering untold wealth with billions of dollars of tech companies they see as local content creation. blamed for its destruction.
I mean, they’re not completely wrong… at least in terms of some uncomfortable facts. Local journalism is dying. Some platforms have pushed for adoption of their own protocols (looking at you, Facebook), ultimately resulting in little more than a consolidation of the platform’s power.
But the big tech companies aren’t killing local journalism. Many organizations assumed that printing news on paper once a day would be necessary for everyone to stay up-to-date with current news. Once it became clear that people were moving to other platforms and services, news agencies reacted. By that time it was too late. Thousands of news sources called the news “the only news game in town” as well, changing the notion that news only needed to be delivered once a day.
The 24-hour cable news network started this landslide. The advent of Google, Facebook, Twitter and others only cemented the demise of news agencies that believed people would be satisfied with a product that contained a large percentage of ads and copy-pasted articles from national news services. were.
Local news agencies could opt for a more focused product that engaged directly with readers. Instead, agencies outsourced reader engagement to Facebook and increased ads and third-party content generated by national news sources.
In response, many governments and outspoken special interests have decided to speak out that it is not their fault for reacting poorly to this massive change in Internet news sources. Instead of accepting the fact that they responded poorly, they have decided that the road to financial solvency runs through the pockets of tech companies that never got started in the news business.
Canada’s legislators are the latest to enact antitrust legislation. It is only a resolution at this point, but if passed, Canada’s concerns would be subjected to an all-American brush.
The Canadian government this week introduced a legislation that would force Google and Facebook to pay Canadian news publishers to access their articles online.
The Online News Act was created by Canadian Heritage Minister Pablo Rodriguez to describe a crisis in the country’s media sector that resulted in the disappearance of 451 outlets between 2008 and 2015. “We want to make sure that news outlets and journalists are properly compensated for their work. We want to make sure that local independent news thrives in our country,” Rodriguez said in a press statement.
Specifically, the proposed legislation seeks to ensure that journalists and publishers receive a fair cut of revenue from collecting, distributing, sharing or summarizing the stories of Big Tech banks; So far no concrete arrangements have been made.
Let me just “hammer it out” for you. Are you sure you want to know how this will work, Canadian legislators and news agencies? I use this fictional conversation to demonstrate that it’s also a fairly recognizable meme:
Government of Canada/News Agencies: If you wish to link to Canadian content, you must pay us.
US Tech Companies: Well, we won’t link to Canadian content.
Government and news agencies: No, it is not
This chain of events has happened over and over again. And yet, such entities think it will be somehow different. it time.
Tech companies aren’t going to pay to index content. even if you strongly believe that companies are morally Being obligated to pay news sources to send traffic, there’s nothing that justifies companies actually paying others to send traffic. Even if you firmly believe that Google, et al intentionally killed local journalism and desecrated its corpse, simple math suggests that tech companies swayed news agencies into solvency. which is well below the historical level of profitability based on being the only game in town.
The only thing stopping Google, Facebook etc. from being cut-and-run is the optics. If these companies determine that leaking revenue to please regulators is ultimately more profitable, they will do so. But this determination largely depends on how much the governments making such laws will demand.
A similar law was passed in Australia (one said to directly prompt this Canadian effort) There hasn’t been a mass exodus … yet.
When Facebook heard about Australia’s plans, it blocked users’ ability to share any Australian news article on its social network before banning the content and reaching a peace deal with the government.
Meanwhile, Google said it would pull its search engine out of Australia if forced to pay for News, although it has since spent nearly $1 billion in expanding staff in the country and growing its cloud operations. dollars have been invested.
Australia’s bill passed and went into effect on March 2, 2021, and neither Facebook nor Google has left Down Under.
It looks like the war regulators can win. But look closely at the details. Google remains active in Australia and has actually invested more money (in questionable news providers), possibly indicating nothing more than that it believes that abiding by these rules will help under-funded companies increase their market share. will prevent cuts. And Facebook deployed the nuclear option before forcing regulators to address Facebook’s concerns.
If Canada wants to turn the dice on a bound engagement, it can. But it’s probably worth taking a closer look at what people are seeking to pay for failing to create as many engagements as possible before deciding the only way to punish other companies for their success is to do so.