Media Companies File Complaint With Competition Bureau Over Meta Failing to Steal Their Content

The media companies have complained that companies like Meta are stealing their content. Now, they are filing a complaint for their lack of “theft”.

One of the long running false argument by the media companies is that platforms are “stealing” their content because they allow news links to be posted by the publishers to their content. It is what we have dubbed the media companies Big Lie 1.0. Now that Meta has begun rolling out news links blocking on their platforms, the logical conclusion is that the media companies should be happy because that so-called “theft” is coming to an end.

Well, earlier, in response to the platforms warning that they would be dropping news links, the media companies rolled out Big Lie 2.0 by saying that by not allowing news links, the platforms are censoring the news and stopping people from reading the news. For obvious reasons, none of this adds up. Are the companies wanting their news links on platforms or not? By arguing that news links on the platforms is stealing, but at the same time, saying that no news links on the platforms is censorship, the primary two talking points directly contradict each other.

All of this is over top of the fact that the news publishers themselves are the ones posting those news links in the first place, knowing full well that the referral traffic to their websites are inherently valuable. It demonstrates that big publishing actually knows how this all works, but are choosing to weave a web of lies that only most brainwashed and ignorant could possibly believe.

The truth in the matter is that this is a massive shakedown where the publishing companies tried to send ransom notes to the platforms. In response, the platforms refused to play ball and are essentially choosing to drop news links entirely. Despite what the media companies claim, news content isn’t actually that valuable to the platforms and the decision was obvious from the beginning. The ransom attempt is failing with Bill C-18 not even containing a provision that requires the platforms to link. In the words of Heritage official, Thomas Owen Ripley, by the platforms dropping the news links, payments will no longer be required because the platforms have ‘exited the market‘.

In other words, the media companies find themselves up a creek without a paddle. They are about to see their news links dropped from the platform and are facing a massive financial hit across the entire news sector. It was a situation of their own making which is why it’s hard to even feel sorry for them. There’s no law compelling the platforms to link, no domestic law that will help, no international law that will change the situation, and other countries (namely the US) have told Canada that they are on their own in this mess. The government, simply put, is out of options thanks, in part, to their refusal to rescind the law.

While the government and media companies have taken a lot of bizarre steps to mitigate the damage, none of which would actually move the needle on the situation in the grand scheme of things, that hasn’t stopped them from trying. Recently, the media companies made another effort that is just plain bizarre. They filed a complaint with the Competition Bureau demanding that links be restored on the platforms on the basis that the move is anti-competitive. No, really:

C. Remedial Measures

Considering the foregoing, CAB-ACR and NMC/MIC on behalf of their members and CBC/Radio-Canada urgently request that the Bureau commence an inquiry under section 79 of the Competition Act into Meta’s refusal to comply with Bill C-18 and its blocking of news content. It may also be open to the Bureau to commence an inquiry under section 75 of the Competition Act for Meta’s refusal to deal with Canadian news organizations regarding news content on its platforms.

In our respectful view, the following corrective measures are the minimum of what is required to cease the devastating harm that Meta’s conduct is inflicting on the Canadian news industry:

  • Prohibit Meta from blocking access to news content on its digital platforms accessible in
    Canada; and
  • Prohibit Meta from discriminating in any way, by algorithm or by any other means, against the content of Canadian news organizations on its digital platforms accessible in Canada.

If Meta refuses to cease its anti-competitive conduct voluntarily, CAB-ACR, NMC/MIC and CBC/Radio-Canada urge the Bureau to file an application before the Competition Tribunal for an order regarding the above corrective measures.

First of all, it should go without saying that platforms are not media companies. Likewise, media companies are not platforms. They aren’t even in the same industry. It’s a wild theory to suggest otherwise.

Second, these are private companies (CBC being the exception since they are publicly funded) we are talking about. If Meta, a private company, is allowing others to post links to their site on their platform, great, it’s a mutually beneficial thing. If Meta decides for whatever reason that they are no longer going to let other companies advertise on their platform, that is well within their right. Sad for the companies, but that is their choice. There’s no precedent in Canada saying that one company must allow another company to advertise themselves on said companies properties.

The closest you can get is possibly health warnings on things like cigarettes, but those warnings aren’t actually for the benefit of another private companies profits. It’s a public health issue that is designed to not only curb habits that negatively affect people’s health, but also save taxpayers money from potential healthcare costs.

If a private company has a cork board and is allowing advertising, they have every right to pick and choose what advertising gets displayed on their private property. In fact, it was the media companies themselves that demonstrated this right so perfectly when they refused to run ads from Meta explaining why they are dropping news links. If anything, the media companies are basically saying that the opposite is true going the other direction, saying that Meta has no right to refuse to allow advertising on their services. It’s straight up hypocrisy.

This filing is really a case of the more you dig into it, the more absurd it gets:

Meta’s decision is in response to the passage of the Online News Act, also known as Bill C-18, on June 22, 2023. Bill C-18 now requires Meta and other web giants (defined by Bill C-18 as “operators”) to negotiate compensation agreements with Canadian news organizations for the reproduction of news content on the operators’ digital platforms (defined in Bill C-18 as “digital news intermediaries”). Instead of working with the Canadian government and news organizations to further the objectives of Bill C-18, Meta has chosen to actively inflict harm to news organizations, threating the viability and sustainability of the industry in Canada.

(emphasis mine)

Spelling mistake aside, this is actually a false argument. When people think of “reproduction” of news content, people tend to think that this is in reference to whole articles being reposted. That is absolutely not what happens on social media platforms. Instead, what gets posted – typically by media companies themselves – are links, snippets, and thumbnails. This hardly constitutes “reproduction” by any means. I think it should go without saying, but if you are filing a complaint with a regulator or watchdog, it is usually ill-advised to lie to them, but that is precisely what the media companies did here.

Another passage is equally laughable:

First, it is incontrovertible that Meta “substantially or completely controls a class or species of businesses across Canada,” namely the social media market and a large part of the online advertising market. News consumers increasingly turn to social media platforms as their gateway to news. Social media platforms have effectively become a significant input or channel through which news media reach their audiences. By controlling two of the largest social media platforms, Facebook and Instagram, which together account for over 70% of the online social media market in Canada, Meta effectively has substantial control over access to Canadian news and also, more generally, on the news industry in Canada.

(emphasis mine)

The problem with this statement is that it flies in the face of the media companies own testimony before the Senate when they spoke about how much traffic comes from platforms. In one instance, a media company said that 40% of their traffic comes from Google while 30% comes from all social media (not just Facebook, but all social media in general).

If Facebook accounted for 95% of all traffic for a majority of all media companies, there might have been a case for this. However, this simply isn’t reality. Even Google’s percentage of 40% of traffic would hardly constitute “substantial control over access to Canadian news”. The reality is that the news publishers themselves have their own websites and apps that allow for access to the news. This is a point that the media companies themselves have been drilling this point in recent times. It should go without saying that Meta doesn’t have the power to block Canadian’s from accessing the news outright, yet this is a talking point that they are using to convince the Competition Bureau that something untoward is going on.

This isn’t to say the loss of Meta platforms won’t hurt, of course. It will, but to say that Meta controls what people see in the news is, at best, an incredibly strained argument. The existence of a television, radio, and newspapers alone pretty much kills that argument off outright.

Moreover, this is a situation that the media companies brought onto themselves. They were the ones that were posting news links onto Meta platforms in the first place. The media companies themselves lobbied heavily for this law in the first place. The media companies pushed their disinformation campaigns and did everything in their power to ignore all the warnings and convince lawmakers that this was necessary. Now, the consequences of the media companies actions are coming to bear and they are unhappy when the platforms refused to play ball over content that means so little to them in the first place. Quite frankly, it’s the media companies and the governments fault that we are here in this situation in the first place.

While the media companies will probably play up any followup story about the Bureau is going to go ahead with an investigation, the thing is, that is what they are required to do no matter how ridiculous the complaint is. Even if the Competition Bureau is convinced that there is a case (which would substantially hurt their reputation in the first place since it would suggest that they are naive with how the internet works), then the road to successfully lodging a complaint only gets tougher.

Eventually, this sort of complaint would have to go before a judge. This step is fraught with problems.

For one, a judge would have to be convinced that the act of referencing material requires compensation. As the law profession is all too familiar with, simply citing a case in a legal brief doesn’t require compensation to, say, the legal councils or the judge presiding over the previous case. Such a concept is absurd because that’s not how copyright law works in the first place. That, alone, should see such a case get tossed out of court.

For another, refusing to pay for referencing material is by no means an anti-competitive behaviour. As stated above, Canadian’s still have access to news through other means. Whether this is through traditional radio or television broadcast (methods that platforms have little to no presence in) or other means, Meta has no technological ability to halt the access to all news to all Canadians.

Third, there is no real good legal precedence that says that platforms absolutely must carry news links in the first place. Such a concept falls well within the realm of compelled speech. Arguably, compelled speech would be unconstitutional because, in part, this is an institutional requirement that is being proposed. Opening up the Canadian Charter of Rights and Freedoms over very big concepts like compelled speech is not something the legal community likes doing very much – and for very good reason.

Fourth, even if you manage to convince the courts that all of the above is no big deal and order the platforms to continue hosting links by this magical new law that is birthed by the justice system (which is backwards), such a requirement would then be open to trade retaliation from the United States. After all, this is a plain as day law that discriminates against US businesses. This target explicitly targets Google and Meta which are both American companies. 100% of the affected companies are US-based here which is brings an obvious challenge from the United States.

All of this basically screams “doomed to fail”. The only real question is whether or not the Competition Bureau is willing to risk its reputation over these incredibly strained legal theories and contradictory claims. Hopefully, the answer is “no” and when the Competition Bureau finishes its investigation, will turn to the news publishers and basically say, “Sorry, but you guys have no case here.”

University law professor, Michael Geist, is also skeptical that such a case will get very far:

The media outlets also argue that “by refusing to negotiate with Canadian news organizations in good faith for the access of Canadian news content on Meta’s platforms, and by blocking the news content on the platforms, Meta is denying Canadian news organizations fair compensation for their content, leaving them with limited resources to compete effectively in the news publishing market.” If anything, the media outlets make a persuasive case in their application that they should be paying Meta for the free links. The removal of those links are described as threatening the “viability and sustainability of the industry in Canada” and representing a “critical distribution channel.” That distribution channel has been free to the publishers for years. Given its importance, Bill C-18 flips the value proposition by somehow mandating that Internet companies pay for the privilege of providing a critical distribution channel for the media outlets.

Ultimately, the claim is filled with contradictions as the blocking news links is alternately described in one paragraph as degrading the social media platform and in the next as entrenching its dominant market power. There are lots of concerns with Meta, but its decision to comply with the deeply flawed Bill C-18 by removing news links isn’t one of them. This outcome was entirely foreseeable, yet the media sector made the bet that the platforms could not live without its content and would ultimately pay for it despite the absence of an economic rationale for doing so. The solution does not lie in a Competition Act action that could ultimately lead to adult, gambling or even misinformation sites seeking similar remedies to prohibit blocking their links. It lies in fixing the flawed legislation by addressing the foundational problem of mandating payments for links.

If anything, this filing is just the media companies flailing around at this point. It’s a desperate bid to try and push these wild legal theories onto anyone and everyone until something sticks. There was already a push for the US to intervene that failed. Ultimately, the media companies and the government are out of options and are just spit balling at this point. About the only thing that is even remotely plausible at this stage is massive news media bailouts which the government has openly contemplated. It’s a horrible solution because it is a temporary solution to a permanent problem, costing taxpayers who knows how many millions because of a failed thought experiment.

As we’ve said ever since Bill C-18 received royal assent, the government has two options. The first option is the government rescinding Bill C-18. The second option is to let the media sector drown. With how stubborn the government has been in this whole sorry affair, it seems like the government is more content with letting the entire news sector drown.

Drew Wilson on Twitter: @icecube85 and Facebook.

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