Prof: Media Organization Slashes Jobs After Receiving $52 Million in Subsidies

As the link tax debate continues, one professor is pointing out how one organization received major subsidies only to slash jobs.

It’s no secret that major publishers have been pumping out disinformation in an effort to sell the obviously bad link tax law. While it seemed as though the debate was settling down after Google caved and started inking deals with various media outlets across Canada, some organizations across the world have already started complaining that they aren’t getting enough money from aggregators for sending them free traffic.

Indeed, some organizations in Canada have been less forceful with their push for a link tax in Canada ever since deals started getting signed. However, the push for a link tax never really fully went away. In fact, Post Media has been holding out in an effort to get the government to implement a law, thereby attempting to score a better deal with the likes of Google and Facebook. What’s more is that Heritage Minister, Pablo Rodriguez, has already made it clear that he is bringing back Canada’s war on the open Internet. That does include the link tax which the Liberals promised to bring back within 100 days of the sitting government in their party platform.

So, it does make for some interesting reading when you find out what has been going on behind the scenes of one of the biggest backers of the link tax. Carleton University professor, Dwayne Winseck, posted some interesting statistics on his Twitter account recently. It turns out, that organization has been receiving some pretty generous subsidies all this time. At the same time, while the money was rolling in, jobs were getting hacked and slashed anyway:

This one really kills me: Canada’s largest newspaper group @postmedianet, despite receiving $10.8m from the fed’s journalism support program, $40.3m from the Canada Emergency Wages Subsidy & $1m from the QC govt’s subsidy program for news media, laid-off 50 people, cut another

70 slashed salaries 5-30% for journos & staff making > $60,000 & closed 15 community papers. In 2020, Postmedia recorded operating profits of 36% on revenue of $190.7 million. I am all for providing strong subsidies & policy supports to public interest journalism but somehow

it has to be done in a way that does not end up looking like this. Any blather from the likes of Postmedia & its lobby group, too, about news compensation from the ‘web giants’ also needs to bear this in mind.

On first blush, you might think that COVID-19 did see a substantial drop in ad revenue, however, that is what the Emergency Wage subsidies are for: to pay employees in the absence of that revenue generation.

What’s more is that this seriously undermines the idea that news organizations are dying and that the only thing that will save them is for Canada to implement a link tax. That messaging was seen through the notorious “disappearing headline” campaign a while back. The above suggests that while organizations were crying out that they are on the verge of bankruptcy, they were also pulling in millions from government. In the process, it makes that campaign look even more sketchy than it already was.

(via @mgeist)

Drew Wilson on Twitter: @icecube85 and Facebook.



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