The link tax history of Spain has officially been repeated in Canada. The government is begging Meta to please come back.
When a link tax winds up failing, what usually ends up ensuing is begging efforts by either the publishers or the government for the platforms to return. One such example is Spain when Google dropped news links in response to the Spanish version of the link tax. What ensued was a long running effort of begging for the platform to please oh please pretty please come back.
For those following various link tax debates around the world, it’s a familiar pattern. Big publishing and government incorrectly assume that platforms derive a benefit unfairly over publishers who push their news links on platforms. A law is passed saying that allowing news links on platforms requires payment. Platforms reject this concept for reasons that should be obvious. News links get blocked. Reality then sets in that publishers need platforms far more than platforms need publishers. After that, the begging games begin for the platforms to return.
Up until last week, it seemed like all but a sure thing that Google was going to follow Meta’s lead later this month and drop news links altogether. The government was showing no signs of backing away from their idiocy publicly and Google had zero reason to back down. The only way news links wasn’t going to be dropped by the 19th is if one side blinks – to which the government had the greatest chance of being the one to blink first.
… and blink the government did.
Last week, the Canadian government folded under the pressure and gave Google everything they asked for. Payments for news links was essentially scrapped, the dollar figure asked was never given, deals are getting dissolved, and everything is being folded into a fund model that, through a healthy dose of creative accounting, tallies $100 million. It’s creative accounting because that dollar figure also includes all previous deals as well.
Google responded overwhelmingly positive to this, after taking a hefty one third chunk, the CBC responded to the cash flowing straight into their bank accounts with positivity, calling it a great day for journalism, lobby groups were either unsure how to respond or reacting with anger, and publishers like the Toronto Star angrily refused to support the deal. If you don’t believe us in our analysis, then stakeholder reaction should tell the story nicely.
There is little doubt the Canadian government got absolutely mauled in the negotiations. Some hypothesized that the government was simply terrible at the negotiating table. Personally, I think it was much more a case of the government going in with nothing to bargain with and the end result was going to be obvious. Regardless of the reason, the Canadian government tried putting a positive spin on the situation, patting themselves on the back for a job well done. It seems that the government and their die hard supporters (and CBC and Google indirectly) are about the only ones that think so. The only way to describe this as a “win” is in a Charlie Sheen sort of way.
One of the few things the Canadian government got out of it was that they will not be the government to fulfill the far right’s wet dream to “murder the media”. The government also can say they got a “deal” – albeit in a “I will take anything. You win! You get everything! Just please let me off the hook just this one time!!!” kind of way.
With that done, though, the government has apparently turned its attention to Meta. As you are no doubt aware, Facebook dropped news links back in August. After making the decision, the platform really hasn’t looked back. The news links drop had proven the point that Facebook wouldn’t miss news links and the only ones that suffered in the process were the publishers posting the news links – often the same ones that pushed for the link tax law in the first place. Well, as it turns out, the government has already begun the process of begging for Meta’s return. From the Globe and Mail (probably paywalled):
Ottawa has made a fresh overture to Meta in an effort to persuade the tech giant to come back to the negotiating table and unblock news on Facebook and Instagram.
The approach to Meta by officials in the Heritage Department was made this week shortly after it clinched a deal with Google, sources said.
Meta has said the problems it has with the legislation cannot be fixed through regulations.
“Unlike search engines, we do not pro-actively pull news from the internet to place in our users’ feeds and we have long been clear that the only way we can reasonably comply with the Online News Act is by ending news availability for people in Canada,” spokeswoman Lisa Laventure said.
Heritage Minister Pascale St.-Onge has said she was keen to resume talks with Meta months ago, but Meta declined. Her department renewed their overtures to Meta this week.
Three government sources said the department had approached Meta about talks. The Globe is not naming the sources because they were not authorized to speak publicly on the matter. Two expressed optimism the Google deal would spur Meta to come back to the negotiating table.
The government’s situation really hasn’t changed between when they were in talks with Google and now. The government is approaching Meta with pretty much nothing. It’s possible that the government could get a dollar figure out of Meta, but chances are, that dollar figure likely won’t be wildly different from what Meta was already willing to pay to publishers before the link tax nonsense started up. What’s more is that programs that were already in place didn’t end up meaning much when the link tax was already working its way through the legislative process, so Meta knows that what good will they had before will get conveniently forgotten should publishers start trying to demand ransom money again. This debate proved that beyond a shadow of a doubt.
As the article alluded to, even getting Meta to talk in the first place is going to prove to be difficult. A strong case can be made that Meta has no reason to even respond to such requests to talk in the first place, let alone be willing to talk. This despite the government massively caving to Google. That, of course, doesn’t exactly bode well for getting a substantial financial stream from them even with a fund model. Time will tell on that one, but the government really doesn’t have a lot to work with here even just to get Meta to talk.
Ultimately, the goal for the government is going to be to get news links restored on the platform. It’s the only way to finally get the $230 million boat anchor off of the publishers ankle which has already caused a few publishers to drown. Depending on what happens, this process could take days or even years if international history is anything to go by. For instance, the mess that happened in Spain took a whopping 7 years to clear up – and that was only after the government essentially rescinded their link tax laws. So, it’s really up in the air how long such a process would end up taking. That’s not even getting into if the government is able to get Meta to cough up some money for the publishers. Even then, the amount is unlikely to really make a financial difference for these publishers in the first place.
One thing that does seem to be all but certain is that the government is going to end up conceding a lot. It already did so with Google and, chances are, it will have to do the same with Meta whenever such talks end up taking place.
(Via @MGeist)
Drew Wilson on Twitter: @icecube85 and Facebook.
