Canadian Media Publishing False and Misleading Statements to Sell C-18

The campaign by the media to mislead the public on Bill C-18 is well under way now. This to sell the legislation.

Earlier, we wrote our analysis on the dumpster fire that is Bill C-18 – Canada’s link tax law. The law is so bad, that if you are looking for a way to badly legislate, the bill itself provides a seemingly endless goldmine for bad policies. Yesterday, we noted that another bad policy that was uncovered (that we admittedly missed) was that merely “facilitating” access to news is enough for Bill C-18 to take effect. Chances are, this won’t be the last discovery either. That bill is terrible policy all the way down.

This is, of course, a bill that the media lobbied heavily for. Ultimately, they largely got what they want. For them, the next step is to sell their legislation to the Canadian public. After all, journalism integrity among the large publishers has been dead for a while, so why not be naked about their bias in the first place? Unfortunately for them, facts are not on their side. So, the only alternative is to lie and mislead Canadians on the legislation itself. In recent days, that was on full display.

Ottawa Citizen Article

One article we came across was by Katie Davey. In the article, Davey bragged, “I started my own podcast (before it was cool) in 2018”. So, it’s clear from the get go that the author doesn’t really understand the history of technology. For crying out loud, our podcast started in 2018 and we know full well that we were actually late to the podcasting game by over a decade. So, obviously not off to a good start there.

Claim: Bill C-18 Includes Small Independent News Outlets

The first claim has quite a lot of flour to it, but here’s the first one:

• Ensuring fairness: We also called for the broadest inclusion possible of news organizations to ensure local, digital and start-ups that produce high-quality independent news were included. We recommended using the existing QCJO model to determine who is in and who is out. The government appears to have embraced this concept.

Critiques of the Online News Act have been quick to jump to the conclusion that it favours legacy (that is, traditional) media. It doesn’t. The bill spells out the broad criteria for qualification is the QCJO status. The threshold to qualify for QCJO is low: an organization must employ two journalists, have arm’s length editorial decision-making, and produce original news.

This is easily deunked by citing Section 27(1) which reads:

Eligible news businesses — designation

27 (1) At the request of a news business, the Commission must, by order, designate the business as eligible if it

(a) is a qualified Canadian journalism organization as defined in subsection 248(1) of the Income Tax Act; or

(b) produces news content that is primarily focused on matters of general interest and reports of current events, including coverage of democratic institutions and processes, and

(i) regularly employs two or more journalists in Canada,

(ii) operates in Canada, including having content edited and designed in Canada, and

(iii) produces news content that is not primarily focused on a particular topic such as industry-specific news, sports, recreation, arts, lifestyle or entertainment.

The important provision is what I emphasized. A vast majority of news outlets online have a particular topic that is focused on. What’s more, by the time you have two journalists employed at arms length from the editorial process, you are a medium sized business in the grand scheme of things.

Fact check verdict: False

Claim: How else are media organizations going to survive?

This is less of a claim and more of a laughable statement:

There is a delicate balance to be struck. We don’t want news producers so insulated from the market as to escape the pressures to innovate. But there’s also a public good at stake here. We certainly need a renewed vision for the business model (or models) of news in Canada — specifically for local news. In the process, I don’t want my community — or yours — to become the 451st to lose its local paper.

Obviously, by simply shovelling free money to the legacy corporations, you discourage innovation because, well, what’s the point? Either the newspaper adds a section and receives thousands of dollars or they just keep going business as usual and still receive thousands of dollars. Honestly, what’s the point.

What’s more is that these same media outlets are already receiving compensation for the “blow after blow” through the COVID-19 wage subsidy and other COVID-19 relief benefits. What’s more is the well documented $10 million bailout late last year which had major transparency problems from the start. The real question that should be asked is how much more free money do you throw at these companies to stay afloat before you just let them go under because it was so badly mismanaged? In a lot of cases, these outlets have a monopoly in a particular city in the first place. How do you screw up having a monopoly?

Fact check verdict: Misleading

National Post Article

We move on to the next article found in National Post which passes itself off as an explainer on how media outlets get paid.

Any media outlet can go into bargaining/arbitration

The first claim can be found with this:

On the other side, news outlets will apply for eligibility.

Companies that have a commercial deal in place — both Google and Meta have agreements with a number of Canadian publishers — will apply to the CRTC asking to be exempted from mandatory negotiation. If the deals meet the criteria set out by the government (such as whether they provide fair compensation), the CRTC will deem them exempt.

But if they don’t meet the criteria, or if there is no deal in place, the two sides will go into mandatory negotiation with an independent arbiter they both agree on (not the CRTC). If they can’t reach a deal, the negotiations will move to final offer arbitration, in which each party submits their offer and the arbiter picks one.

Section 27(1) (which we quoted above) easily debunks this. This suggests that any media outlet can be part of the bargaining process. This, however, is simply not true. The legislation takes great pains to exclude as many outlets as possible – especially if you are a smaller news outlet online. If you focus on a specific topic, then you are barred from this process, forcing the issue that you cannot benefit from the legislation in any way.

What’s more is the first article also inadvertently debunks this claim by pointing out that you are required to have at least two journalists at arms length from the editorial process.

By just broadly stating that it’s just “news outlets” that can qualify, it renders this claim misleading because some media outlets (namely, the larger legacy outlets) obviously qualify. The rest get cut out of the process altogether.

Fact check verdict: Misleading

Pymnts Article

Another article was published on PYMNTS.

Claim: The US already has a link tax in place

This claim can be found with this comment:

U.S. lawmakers have put similar laws in place, and news publishers in Europe have lobbied for something like the Australian laws.

This got our attention. Since when did the US pass a link tax? We looked around and didn’t find anything about the link tax passing in the US.

What we do know about the status of similar concepts in the US is that the US Copyright Office solicited feedback over a possible link tax – which the Copia Institute responded to. In February, US journalism outlets actively called for a link tax.

The closest we are aware of with these “similar” laws is the Journalism Competition & Preservation Act (JCPA) where Public Knowledge published an explainer as to why such a law would be bad. So, we dug around for the bill which, as it turns out, is also known as HR2054. According to the official government website, the last action is that the bill was “Referred to the Subcommittee on Antitrust, Commercial, and Administrative Law”. What’s more is that the website is clear that the bill was merely “introduced”, not passed into law.

Fact check verdict: False

Toronto Sun

Another article was published on The Toronto Sun.

Claim: The law goes after aggregators and platforms for re-using content

This first claim comes right off the lead:

During last year’s federal election, Prime Minister Justin Trudeau and the Liberals promised to introduce a bill to make digital giants such as Google and Facebook compensate Canadian newspapers fairly for reusing their content online.

As we reported yesterday, the bill goes much much farther then that and includes simply “facilitating” access to news. This is found in Section 2(2) which states the following:

Making available of news content

(2) For the purposes of this Act, news content is made available if

(a) the news content, or any portion of it, is reproduced; or

(b) access to the news content, or any portion of it, is facilitated by any means, including an index, aggregation or ranking of news content.

The excerpt suggests that this is is merely about platforms and aggregators that republish articles without compensation. The thing is, anyone who has ever used aggregators or social media know that what is actually posted is typically the headline, a short excerpt (barely two sentences at times), a thumbnail (scaled down version of the picture used), and a link to the actual article. That is the actual standard practice. They are not actually republishing whole articles and slapping ads on the post after.

This is a very important distinction because simply referring to material online is obvious fair dealing whereas reposting whole articles is copyright infringement.

Face check verdict: Misleading

Large aggregators place their ads on the news sites and take the profits

A real eyebrow raiser is this:

Over the last 15 years, hundreds of newspapers across Canada have closed and thousands of jobs lost in part because Facebook and Google took control of 80% of all industry advertising revenues.

They used their monopoly power not just to divert advertising from newspapers, but to divert millions of dollars in advertising revenues that they place on newspaper sites.

The boldfaced section is obviously a fabrication. The likes of Google isn’t actively placing their advertising on the newspapers sites and taking all of the profit. Such a claim is not just false, but borders on blatant defamation as well.

How advertising works in the real world is that a website can voluntarily request advertising from an ad network. This is commonly the Google Adsense network. After that, the website administrator obtains a piece of code. The administrator then accesses the website in question and places the code, themselves, onto the website.

From there, Google charges a commission in the form of a percentage. After that, a majority of the revenue derived from that ad goes back to the publisher. All that only after the publisher jumps through a small number of hoops to voluntarily ask to have ads placed on their site. Those publishers, can obviously just go it alone and place their own ads on their site. Regardless, they maintain complete control of their site. Either way, the large tech companies are not going around different people’s websites, placing their ads on other people’s sites, and taking the revenue.

Fact check verdict: False

Claim: Large tech companies take profits from all advertising

This next claim is just on another level of ridiculousness:

Even when advertisers paid specifically to advertise on newspapers’ digital sites, they used their market dominance to keep the lion’s share of advertising revenues.

The impact on the newspaper industry has been devastating.

This claim barely even makes any sense. If an advertiser approaches a website and asks to have their ad appear on their site, and the website agrees, then they can work something out on their own. They do not need an ad network like Google or Facebook to facilitate this. What’s more is that by doing such a business to business relationship, then ad networks like Google and Facebook make no money off of it. They were effectively cut out of the picture. This is, obviously, allowed.

The only way that this claim makes sense is if the website tells the publisher to work something out with Google instead. At that point, that is on the website for making such a mistake in the first place. If the complaint is that Google is taking too much money, then don’t force the advertiser to work through Google and place a separate ad on your site. This is not rocket science, here.

Fact check verdict: Misleading

On a side note, we couldn’t help but catch this little gem:

A Leger poll commissioned by News Media Canada last year found 82% of Canadians surveyed were in favour of requiring Google and Facebook to pay Canadian newspapers fairly for their online content.

We agree and urge Parliament to pass this new legislation as soon as possible.

We’ve been around way too long to know that polls don’t mean jack when the full results aren’t published. What’s more is that these are paid polling results. So, without knowing what question was specifically asked to churn out such a result, that point is actually very meaningless. We’ve seen too many instances of push polling to know how results can be forced in the first place.

Global News Article

Another article we saw was from Global News.

Claim: Platforms and aggregators make their money off of the content of news outlets

It’s a repeated claim, but here it is anyway:

Canada is poised to force digital giants – like Facebook and Google – to share profits with Canadian media outlets when they make money off their content.

Again, this was already covered.

Fact check verdict: Misleading

Claim: The platforms and aggregators will pay money to the outlets behind the content

Another claim we debunked earlier, but here it is anyway:

But if the bill becomes law, platforms like Facebook and Google can expect to see a portion of the profit they make from news go to the organizations behind the content

As mentioned, Section 27(1) debunks this decisively because not all of them will receive compensation. The punchline? The article then proceeds to debunk itself in the same paragraph right after:

though it will be up to the designated regulator, the Canadian Radio‑television and Telecommunications Commission, to decide which outlets get a piece of the pie.


Fact check verdict: Misleading

Claim: News rooms are shutting down because of Google and Facebook

It was probably only a matter of time before this claim wound up being made:

According to the government, 450 private news outlets have shut their doors in the last year as Google and Facebook hoover up 80 per cent of online ad revenues.

This implies that the newsrooms are shutting down because of Google and Facebook. There are other factors involved that is undisputed. This includes COVID-19, fewer people actually bothering with newspapers as the Internet winds up being a superior medium, etc. While it would be a false claim if the excerpt directly says it, the excerpt merely implies this.

Fact check verdict: Misleading

We also note this incredibly odd remark in the article:

On top of that, when pressed on whether the obligation to share profits with credible news organizations could lead these digital platforms to favour non-news content – such as meme pages that can spread misinformation – on their platforms, the senior officials said they “start from the premise” that digital platforms want to ensure the services they offer to Canadians are “healthy, inclusive” and provide “reliable” information.

Who exactly is saying that the legislation is too inclusive in the first place outside of this article? Heck if I know. Still, the bill is obvious that it only applies to the larger news outlets that employ at least two journalists at arms length from the editorial process and doesn’t focus on a specific target won’t count. The inclusion of a meme was never even close to being a risk in the first place.

Another article that was published on this came from

Claim: Link tax was stopped by a Conservative filibuster

The next claim likely came from confusing two completely bills more than anything else, but here’s the hilarious screw-up anyway:

Bill C-18 the Online News Act will do just that. The legislation is about a year behind the Liberal government’s schedule, having been derailed last spring by the Conservative filibuster of the Netflix Bill C-10 and a federal election.

Anyone familiar with these issues will be laughing at that oversight. For those of you who are looking at this in a puzzling manner, Bill C-10 in the last government was the Online Streaming Act (now known as Bill C-11). The link tax law was rumoured to soon be tabled, but it was a completely separate bill. It was the Online Streaming Act that was derailed which has nothing to do with the link tax bill. In this case, we can call this an honest mistake more than anything else. Wrong bill, buddy!

Fact check verdict: Honest mistake.

Claim: It’s all Google and Facebook’s fault that newspapers lost money

Again, this is something we covered already, but here it is:

It begins with the well-known decline in news coverage and news organizations as a direct result of the market in digital advertising being cornered by Facebook and Google.

This has led to a dangerous deficit in news and information at a vulnerable time in human history as right-wing populism and authoritarianism are on the rise.

There are, obviously, other reasons why there has been declines in the traditional outlets. This includes the failure to adapt to a modern business model, COVID-19, and a host of other reasons that go beyond Google and Facebook. To suggest that it’s all the platforms and aggregators fault is disingenuous.

Fact check verdict: Misleading

We also noted this:

Is the CRTC the best choice to oversee this regulatory scheme? Let me preface my answer by distancing myself as far as possible from the vilification of the Commission that is popular among Internet activists and inconsolable litigants.

The “vilification” is also very well deserved. The CRTC could have not rubberstamped the Rogers buyout of Shaw (which could actually put news rooms at risk of closure, ironically enough), not openly had beers with executives of corporations they are tasked with regulating, not decided to raise the bills of consumers, etc. That could have made a difference. Maybe, I don’t know, the CRTC actually working on behalf of the consumer might have made a difference? Of course, in this guys mind, pointing out anti-consumer decisions makes the CRTC look anti-consumer and that just makes people like me just little more than an “activist”. Ell oh ell.

There is also this:

If the implementation of C-18 goes as uneventfully as it did in Australia, the Commission may not have a lot to do.

But the Commission may well get handed a hot potato if a news organization – possibly an opinion website or a political action group calling itself a news organization – gets cut out of negotiations.

More likely that a consumer organization might actually litigate based on how unconstitutional this legislation is in the first place. Geist himself questioned whether this bill is even constitutional, saying, “Further, how is any of this possibly constitutional? Would the Supreme Court uphold a law whose effect could be to limit facilitation of access to news? Moreover, how does the entire Bill C-18 framework fit within the federal government’s jurisdiction? It isn’t broadcast, it isn’t telecommunications, and it isn’t copyright. If the government claims powers over anything involving the Internet then it believes there are no real limits on its jurisdiction.”

Another weird comment is this:

Events might unfold in two different ways. If the platforms pursue the path of voluntary agreements in order to avoid arbitration, they will inevitably draw the line somewhere on which news organizations they recognize and then ask the Commission to bless the overall results of their multi-party negotiations under section 11(1) as representing “a significant portion of independent local news businesses,” thus avoiding the designation process and stranding those excluded news organizations.

… and those excluded news organizations then proceed to litigate on the basis of anti-competitive practices among other things. It wouldn’t be hard to build a case in that situation, really.

Concluding Thoughts

The media is obviously in favour of it. The fact that a torrent of false and misleading statements is flooding the Internet right now is not exactly surprising. Bill C-18 is a terrible piece of legislation that should be scrapped. There’s plenty wondering if it is even constitutional. What’s more is that it opens up the possibility of trade sanctions by the US given that the businesses targeted in this is primarily American companies. It puts the government in a position to determine who is considered a news organization and who is not – an inherent conflict of interest from the onset.

Plainly put, the facts are not on the major media outlets side in any way. So, what do you do in such a position? Well, as you can clearly see above, just publish false and misleading statements in the hopes of confusing the public enough into supporting the bill or temper criticism. This eradicates any semblance that the media is simply neutral voices that should be the ones to be trusted – especially in debates such as this where they have a stake on the matters.

What they clearly didn’t expect was a small outlet such as Freezenet willing to run their attempts to mislead the public through a fact checking process. For that, well, you tread on my area of expertise, you better hope that there are much bigger stories happening that sufficiently distracts me. Otherwise, not on my watch are you going to pull such a stunt and have it go unchallenged.

Drew Wilson on Twitter: @icecube85 and Facebook.

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