Canadian Government Imposes Ad Boycott on Facebook and Instagram Over Online News Legislation Conflict
On Wednesday, Heritage Minister Pablo Rodriguez announced that the Canadian government will cease purchasing advertisements on Facebook and Instagram due to a disagreement over a recent legislation concerning the compensation of online news publishers. This move comes as Meta-owned platforms have expressed their opposition towards the new law.
The Online News Act, or Bill C-18, was passed last month, prompting Meta and Alphabet’s Google to say they would end news access to their platforms in Canada.
The government is finalizing the rules that require platforms to share advertising revenue when the law comes into effect by the end of this year.
“Canada is going to stand firm and make sure that if social media platforms and internet giants want to use the media, they really make sure they pay their fair share,” Prime Minister Justin Trudeau said in Montérégie, Quebec.
The government still sees a way forward to resolve the dispute and is open to discussions with the platforms, Rodriguez, who introduced the law, told reporters in Ottawa.
The legislation comes after Canada’s media industry called for tighter regulation of Internet giants to help news companies recoup financial losses suffered over the years when Facebook and Google gained a larger share of the online advertising market.
Rodriguez said 80 percent of Canada’s advertising revenue, or nearly C$10 billion ($7.5 billion) in 2022, went to Google and Facebook, and the Liberal government wants the two platforms to contribute to domestic journalism.
The decision to suspend government ads will cost Facebook and Instagram about C$10 million a year, he said.
Facebook “refused to talk and they didn’t want to compensate the media, so we’ve decided to stop advertising,” Rodriguez added, speaking to two of the three Canadian opposition parties backing the legislation.
Meta has previously said that the news has no financial value to the company and that news organizations benefit from sharing their reports on Facebook.
“Unfortunately, the regulatory process is not ready to make changes to fundamental aspects of the legislation that have always been problematic,” a Meta spokesperson said, adding that the company plans to stop making news available in Canada “in the coming weeks.”
Rodriguez sounded more optimistic about reaching a compromise with Google because the government was confident that “what Google is asking for right now can be done.”
Google, which had proposed changes to the law that were rejected, said last week that the government’s regulatory process was unlikely to resolve “structural problems with the legislation.” The company did not comment on the matter on Wednesday.
The outcome of the dispute between Canada’s internet giants could set the tone for other governments trying to regulate internet companies. If companies don’t get exemptions or the rules are changed in Canada, they could face a similar fate in the United States.
Democratic U.S. Senator Elizabeth Warren, a leading progressive voice, expressed her support for Canada on Wednesday, saying “leaders are right to stand firm against these tactics and oppose Big Tech’s local news for free.”
Earlier Wednesday, Canadian telecommunications operator Quebecor and Cogeco, which operates radio stations in Quebec, also announced they would stop advertising on Facebook and Instagram because of Meta’s opposition to the new law.
($1 = 1.3285 Canadian dollars)
