A Bill C-18 lobbyist noted what a horrible mistake it was to bail out the news sector, says the solution is even more bailouts.
Trust in the Canadian media is in the toilet. People are increasingly tuning out of broadcast news, ending their subscriptions for the newspapers, and not bothering with radio any more. With the digital transition, people are increasingly turning to more reliable sources online such as Freezenet and several other independent news sources out there. This transition has been taking place for the last decade or so. In response, the traditional media simply responded by saying that this whole internet thing is a fad that will go away on its own and chose to not adapt their business models. After all, what’s the worst that could happen if they carry on with business as usual?
Well, as it turns out, a lot can happen with that attitude. The leaders of the news industry that totally has the finger on the pulse of the Canadian public and knows exactly what their audiences wants and needs are are finding themselves caught flat footed. Many of the programs that sustained their business models shifted to online services, partnerships ceased, and the audience moved to the online space where they discovered that there are far better sources of news and entertainment elsewhere.
So, now that the realization set in that action needs to be taken, executives were faced with a choice: adapt and innovate or beg for massive bailouts from the government so they can carry on with business as usual without having to sweat over having to adapt to a modern age. With the advent of Bill C-18, the media executives made it clear that they were all in on the illogical and unsustainable latter option.
In the process, a scheme was hatched: fool the government into implementing a link tax. It was, of course, based on the obviously false premise that platforms are “stealing” news articles. The government heard from experts who did what they could to set the record straight on that matter, but those experts were then dismissed as “Big Tech shills”. So, warnings of platforms giving the straight honest comments of dropping news links on their platforms went ignored.
Predictably, however, despite lobbyists relying on the “just believe hard enough” and everything will magically resolve themselves, Meta dropped news links as they had been warning all along. Lobbyists insisted that they wouldn’t last a week without news links as their business models totally, pinky swear, depends on their news content. Reality had other things to say on the matter, though. Traffic for the platforms remained unchanged, users didn’t really miss the lack of news on their feeds, and engagement of the publishers pages collapsed. Six months later and the story remains unchanged with the exception that Meta’s stock value soaring.
Google, the only other platform affected by the link tax law, was set to follow suit. Faced with the looming deadline, the Canadian government panicked because they were about to be the government that completely sunk the entire Canadian news sector. In a last minute freak out, the government caved to Google, giving them everything they wanted and calling it a “deal”. While some paraded around the $100 million fund model figure as a victory for the government, the deal represented the government cutting their losses. With Meta dropping news links – an estimated $230 million value – the media companies wound up operating at an overall loss of $130 million when all was said and done. The link tax had officially died and the only thing positive that can be said about the situation was that the news wasn’t going to vanish from Google after all.
Painted into a corner, the Canadian government then went on to unveil a massive media bailout program. This in an effort to soften the $130 million loss hitting the media companies as a result of this foolishness. It was the government’s last tool in the chest to try and right the situation, but the Canadian government felt that their actions have saved journalism jobs in the end.
Little did the government know that even the premise of saving journalism jobs was a lie. With the passage of the Online News Act and the Online Streaming Act, the large media companies concluded that they got what they came for – though they got less then they were hoping to get. They were the largest beneficiaries of the funding coming out of all of this and smaller news organizations, at best, got little more than crumbs out of the deal. With no real reason to keep up appearances, the large media companies carried through their original intentions in all of this.
Repeating the history of what happened in Australia where Newscorp slashed 1,250 jobs after becoming the biggest beneficiary of the Australian News Bargaining Code (Australia’s link tax law), the CBC slashed 10% of its workforce. Bell followed suit and slashed 9% of its workforce as well.
While little attention was paid to the CBC slashing its workforce, there was considerably more uproar over the Bell layoffs. Apparently, the Canadian government truly believed that by bailing out the news sector, the large media companies were going to keep those jobs (LOL!). That naivety was put on full display when the government responded angrily at Bell for not holding up their end of the bargain. Ultimately, it was the governments fault for ignoring the calls to have the money come with strings attached, so the government does share some fault in this whole sorry affair.
Having made off with millions, however, it seems that lobbyists are on to their next scam victim: provincial governments. One of the lobbyists that helped scam the federal government out of millions wrote an Op Ed in the Windsor Star trolling BC Premier, David Eby. He said that the passion he expressed by the Bell layoffs after getting massive bailouts was notable, so the solution is to give these same players even more bailout money. No, I’m not even kidding:
B.C. Premier David Eby dropped some verbal firebombs as he went on a two-minute tirade last week blasting BCE, the parent of Bell Media, after its announcement of 4,800 job cuts and the sale of 45 radio stations across Canada.
“The fact that they cannot find it possible with all of their MBAs to operate a few local news stations, in British Columbia, to ensure that people get accurate, impartial, reliable information in an age of disinformation and social media craziness is such an abandonment of any idea of corporate responsibility.
“I find it reprehensible … I think it’s appalling,” he said.
“On behalf of all of the families, of the journalists, the media outlets, on behalf of all British Columbians that have watched their local news stations slowly turned to garbage by these companies who now say, unsurprisingly, that there’s not a lot of support for them, I just want to say shame on you,” he added.
The premier’s outspoken support for local journalism was admirable. We hope that unwavering support and passion will continue into next week’s B.C. speech from the throne (Feb. 20) prior to provincial budget day (Feb. 22).
There are four policies B.C.’s premier can champion that will help support quality public service reporting in the province.
First, B.C. should follow Ontario’s example and exempt newspapers from extended producer responsibility fees. The capture of newspapers in B.C.’s regulation fails to recognize that a newspaper is the product, not the packaging, and effectively subsidizes actual waste producers.
The B.C. government exempts paperback romance novels and single-use paper towels from the regulation, yet they are trying to have publishers pay excessive fees to Recycle BC — a monopoly run by large retailers and packaged goods companies — which will most likely result in the direct loss of about 80 local journalism jobs in B.C. and the shuttering of some newspapers.
Second, Eby should direct 25 per cent of the province’s domestic advertising spend to support local news. B.C.’s news publishers and other local media organizations have earned the trust of millions of British Columbians by providing news and information that is relevant and reliable.
Like many provincial and municipal governments, B.C. does not disclose where provincial ad dollars are spent. Looking at the federal government’s most recent advertising report, we know that too many dollars are going to Facebook/Instagram, X (formerly Twitter) and TikTok — social media giants that do little to combat misinformation and disinformation.
Third, Eby can borrow a page from Quebec’s approach and introduce a 35-per-cent refundable news media labour tax credit. This credit has saved jobs and put journalism on a more sustainable footing in that province.
Fourth, Victoria could introduce a provincial program similar to the federal government’s Local Journalism Initiative or the California Local News Fellowship.
Funding journalist positions in areas of news poverty, particularly in remote areas, would help keep communities informed and connected.
I mean, the comments made by this lobbyist are quite shameless. The Online News Act was pushed on the premise that this was simply about the very smaller players that got ripped off in this whole process. Yet, that lie is being repeated right here in the op-ed. The call to issue additional bailouts to the large media companies that just got through pulling the wool over the federal government is insane.
The thing is, the entire story is out in the public. It’s not just experts such as myself pointing out facts that should have tipped off lawmakers any more. Now, we are faced with the situation where experts like us were proven right all along and now lobbyists are hoping to have history repeat itself by attempting to play the provincial governments. Really, at this point, if Eby falls for these comments, he would only have himself to blame because the scam is pretty obvious at this stage.
If funding is coming from tax payers, then it has to come with strings attached. Any funding coming from the government has to come with reciprocal jobs from the sector. If the media companies want bailout money, they better have the receipts to show that the money went to the actual production of journalism somewhere along the line. Anything short of that is blatantly wasting tax payers money as those dollars are invariably going to pay larger dividends, and CEO/hedge fund billionaire bonuses. What’s more, the money should actually benefit the smaller players in the first place, not just the largest players in the sector.
There are many many lessons to be learned from the Online News Act debacle. The question is, will premiers like Eby learn from that debacle? Only time will tell on that.
(Via @Pagmenzies)
Drew Wilson on Twitter: @icecube85 and Facebook.
