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Tech giants and news organizations | More publishers need a fair deal

During the 2021 federal election campaign, several political parties pledged to introduce legislation on journalist compensation. Why is such legislation necessary?

Posted at 4:00 p.m.

Paul Deegan and Maria Saras-Voutsinas
Respectively President and CEO of News Media Canada and CEO of the National Ethnic Press and Media Council of Canada

First, the need for strong, independent local news has never been greater. These allow communities to stay connected and informed on issues that directly affect them. Covering town halls, provincial and territorial legislatures, and the courts and holding parliamentarians to account is vital to our democracy. We asked Pollara, a leading research firm, to pose a question to Canadians. Ninety percent of respondents said they believed it was important for local media to survive. And for these media to survive, they must be commercially viable.

Second, there is a significant power imbalance between tech giants and Canadian news organizations. To put that into perspective, Google’s market capitalization is around $2.3 trillion; that of Meta is more than 500 billion. Together, these figures are greater than the GDP of Canada, Brazil, Italy or India.

On a combined basis, these companies’ share of online ad revenue is over 80%. And the pandemic has only made the situation worse.

Third, in anticipation of Canadian legislation, Google and Meta have negotiated content licensing agreements with a dozen news publishers, including big players like the Globe and Mail and the Toronto Star. These publishers should be paid for their content. But today we find ourselves in a situation where Google and Meta are picking winners and losers among Canadian news publishers. And it’s not fair, especially for the many small publishers who have been left behind.

In April, Pablo Rodriguez, Minister of Canadian Heritage, introduced Bill C-18, the Online News Act. According to the same Pollara poll, 80% of Canadians are in favor of Parliament passing a law that would allow small media outlets to bargain collectively with web giants. Our organizations, which represent hundreds of trusted media titles in every province and territory, support this legislation for three reasons.

Bargain collectively

First, it allows us as publishers to come together and bargain collectively. Currently, the competition law prevents us from forming a collective. Given the overwhelming power imbalance, we will be in a stronger negotiating position if we unite.

Second, it includes an enforcement mechanism. Baseball-style final offer arbitration ensures that the parties present their best offer and the arbitrator chooses one or the other. The threat of arbitration encourages both parties to come to a fair settlement on their own.

Third, similar legislation in Australia works. According to Rod Sims, the former chairman of the Australian Competition and Consumer Commission, the sums paid to news organizations amounted to more than $200 million. More important than the sum is who made the content licensing agreements. Country Press Australia, an affiliate of 160 small regional newspapers, was able to strike deals with Google and Meta.

More recently, a group of 24 small Australian publishers struck a deal with Google. We believe that Google, to its credit, has signed a content license agreement with each qualifying Australian publisher.

Bill Grueskin, professor of professional practice at Columbia’s Graduate School of Journalism, wrote in a memoir for the Judith Neilson Institute: “Sydney journalism professor Monica Attard says she can’t persuade most students to accept internships these days because it’s so easy for them to land full-time jobs – and she guesses the Code is a big part of that: “I swear to God I haven’t haven’t seen this in 20 years.” »

While publishers clearly derive benefits from collective bargaining, the question arises: how should the members of each collective organize themselves in a way that is inclusive, fair and transparent to all their members?

As a matter of principle, News Media Canada and the National Ethnic Press and Media Council of Canada believe that small and large publishers should benefit equally from any settlement – ​​based on their proportional investment in newsroom employees. In other words, any settlement resulting from collective bargaining would be shared among the publishers on a pro rata basis – based on the total compensation and salaries paid to eligible newsroom employees – minus the expenses associated with this collective bargaining.

Bill C-18 builds on the success of Australia’s News Media Bargaining Code. While not a silver bullet, it does allow readers to benefit from reliable, high-quality Canadian journalistic content through more licensing agreements, which will allow a more large number of publishers to reinvest in their newsroom and in the digital transformation of their business.

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