A new news deal: Google reaches agreement with Canadian government
Canadians will get to keep (some of) their access to news, now that the government has reached a deal with Google over the controversial Online News Act.
What happened: After months of tense negotiations, Google has agreed to pony up $100 million a year for the Canadian news content hosted on its platform, part of an effort to compensate media companies for the advertising revenue that has been lost to Big Tech.
- Back in June, the government had ordered tech companies to pay 4% of their annual Canadian revenue — $172 million per year for Google and $62 million for Facebook.
- We’ve come a long way since Google called that deal “unworkable,” but the feds will still have to confirm the specifics before the law comes into effect on December 19.
Why it matters: Through the deal, Canada (just barely) avoided a Google news block, which would have impacted audiences and publishers — for whom Google is the biggest driver of traffic. In Spain, similar laws led Google to suspend its news platform in 2014.
- Meta, on the other hand, has already blocked news on Facebook and Instagram in response to the law and has shown no willingness to enter back into negotiations.
- Removing news from the world’s biggest social media platforms has hurt Canadian media companies, many of which relied on social media to access their audiences.
Bottom line: Smaller, newer, or independent outlets that relied on Facebook and Instagram are still out in the cold — with many scaling back or pivoting their operations. But for outlets that rely on search traffic, the Google deal will likely bring a welcome sigh of relief.
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