Canada’s Online News Act Gets a Close Look. As Poilievre Vows to Kill It

A new report says the Liberal government’s controversial Online News Act laid a "strong regulatory foundation" for funding Canadian journalism — though when Meta retaliated by banning Canadian news from its platforms, the sector suffered.

The Online News Act started out as Bill C-18 in 2022 and demanded Google and Meta pay Canadian news publishers for sharing their content on the tech firms’ lucrative platforms. The bill passed in June 2023, leading to threats by Google and Meta to ban Canadian news links on their platforms, resulting in a game of chicken between the two companies and the federal government.

Meta made good on their threat, blocking news outlets from posting to Facebook and Instagram.

Google, on the other hand, struck a deal with the federal government to be exempted from the Online News Act for five years on the condition they provide a $100-million grant annually — indexed to inflation — to eligible news media outlets. (To learn more about the exemption agreement, see sidebar.)

The result "creates a funding source that’s reliable, consistent, accountable and greatly needed at the moment," said Sophia Crabbe-Field, lead author of the report, published by the Centre for Media, Technology and Democracy at McGill University.

But whether that funding persists may depend on the outcome of Monday’s election vote. The Conservative Party of Canada has circulated a petition slamming the law, blaming Meta’s counterpunch on Liberals who "have created chaos for people online and eliminated local news from the social media feeds of Canadians."

At a press conference in Niagara-on-the-Lake in Southern Ontario last summer, Conservative Leader Pierre Poilievre denounced government spending to support journalism and vowed to do away with it. "This would be a dagger in the industry of news, especially for smaller papers," Lake Report editor Richard Harley told the Columbia Journalism Review.

The Conservative platform unveiled earlier this week promises to introduce a "Freedom of Speech Act" and to "repeal Liberal censorship laws" — apparently a reference to the Online News Act — to restore Canadian news on Meta "and other platforms."

Another program of support for Canadian journalism created by the Trudeau government is the Local Journalism Initiative, which employs more than 400 reporters covering local beats for publications across the country. In March last year, the Liberal government pledged another $58.8 million to continue the program into 2027, bringing its total support for the initiative to $128.8 million since its 2019 launch. In 2024, the government also announced the Changing Narratives Fund, a program meant to empower BIPOC journalists and creatives, committing $10 million over three years starting in winter 2025.

The Conservatives’ platform promises to increase funding for LJI reporters by $25 million. It does not directly mention the Changing Narratives Fund.

A third support for journalism organizations put in place by the Trudeau government is a labour tax credit, which subsidizes each journalist on the payroll of a qualifying news organization by 25 per cent. It was raised temporarily by 35 per cent for 2023 to 2026 — and the cap increased from $55,000 to $85,000 — after which the rate will return to 25 per cent. The measure was vigorously lobbied for by major news organizations including Postmedia and Torstar.

The labour tax credit is not mentioned in the Liberals’ or the Conservatives’ 2025 federal election platforms.

The Conservatives also say they would limit government advertising to Canadian platforms only.

The Tyee receives labour tax subsidies, the Google funding and has on staff two Local Journalism Initiative reporters covering labour and health. Altogether, these sources make up about a quarter of The Tyee’s revenues. More than twice as much, The Tyee’s single largest source of money, comes from reader contributions.

Campaigning during Meta’s news block

This will be the first federal election during the Meta news ban. While Facebook and Instagram are barren of content by Canadian organizations dedicated to reporting news, the platforms continue to carry propaganda by various actors, some crafted to seem like credible journalism.

Late in March, The Logic reported that the right-wing advocacy group Canada Proud was dominating election-related posts on Facebook and Instagram. The group was behind 31 of the most-viewed posts on Facebook mentioning Prime Minister Mark Carney within seven days, and the group’s posts mentioning Carney were viewed more than 1.58 million times in seven days.

Among those posts were two photographs of Carney with a convicted sex criminal — which Carney’s team dismissed as an insignificant interaction over a decade ago, reported the New York Times. "This type of online content — hyperpartisan and often veering into misinformation — has become a staple in the Facebook and Instagram feeds of Canadians."

Why, as Meta stripped its sites of Canadian news rather than accede to the Online News Act, did Google take a different route?

"Google needed the news, not because of the ad revenue, but because of the desire to have a comprehensive search engine," Michael Geist told The Tyee last year. "They were willing to pay something for that."

Canadian news still lives on the world’s leading search engine, after Google negotiated with the government to arrive at its $100-million annual payment — lower than the $329.2-million annual payment originally estimated before the Online News Act was passed.

Google then selected a collective of indie media companies called the Canadian Journalism Collective to come up with the best practices for fair and transparent distribution. In March, the CJC began flowing money to some news organizations, equating to "about $13,798 per full-time-equivalent journalist," said Crabbe-Field.

Under the current terms, recipients of the Google money must include local, regional and national news outlets, for-profit and non-profit news outlets, English and French-language outlets and outlets serving Indigenous, Black and other racialized communities, Crabbe-Field noted.

Google’s deals in other countries have proven weaker than Canada’s, argues the report.

For example, the company’s pacts with South African media rest on purely voluntary arrangements the company could easily exit, notes the report.

In California, where Google is based, the USD $1.8-trillion firm agreed to provide newsrooms with $250 million over five years to avoid a proposed law that would force tech giants to pay to distribute news content, reported CNN. But some journalists, worried about the threats posed to their industry by artificial intelligence, objected that the deal includes a “National AI Innovation Accelerator.”

In Canada, the Online News Act results in money being "distributed in an equal, predictable and transparent way, and there are set rules to guard against platforms picking winners and losers," says the report.

But before the act was passed, some news outlets drew revenue from exclusive deals with the tech platforms, notes the report. Those are gone. "At the end of the day, many media organizations have ended up with less than they had before," Geist told The Tyee last year.

Meanwhile, the fallout from Meta’s news ban continues to hurt Canada’s news sector.

Last August, a Media Ecosystem Observatory report looking at the impacts of one year of the Meta news ban found that one-third of previously social-media-active local news outlets in Canada (212 total) had become inactive.

It also found that engagement (likes, comments and shares) with news on Facebook and Instagram specifically — the most-used and third-most-used social media platforms in Canada, respectively — decreased by 85 per cent.

"What we’ve seen is Meta’s decision straight up hurting Canadian democracy, hurting the abilities for Canadians to learn about their political world and get well informed," Aengus Bridgman, director of the Media Ecosystem Observatory and project lead, told The Tyee last summer. "This report stresses that platforms exist to make a profit, but they also exist in a country, in a context, and have a corporate responsibility to that context."

There has been little public backlash to Meta founder Mark Zuckerberg’s sweeping response to the Online News Act. Perhaps that is because, as the Media Ecosystem Observatory report noted, three-quarters of Canadians are unaware that the news ban is even going on — including the users who say they get their news on these platforms.

News media as a 'public good'

Crabbe-Field told The Tyee that even if current government supports for Canadian journalism survive after this federal election, more needs to be done to shore up a bulwark of democracy.

Stronger anti-monopoly measures could address "a wave of consolidation since the 2000s in Canadian media" that centralized news decision-making power within large chains and took ownership away from local communities.

"News media organizations need to recreate stronger ties within communities, and part of the reason that those ties have been lost is because of the consolidation."

Policymakers need to zero in on "ways in which Big Tech monopolies are impeding free expression and other rights on the web," advises the report.

And the Online News Act did not address the rising popularity of AI chatbots and the news industry. Future efforts to regulate Big Tech must include regulation efforts in this area, says the report, since chatbots have led to a drop in referral traffic on news sites, and have even tanked referral traffic on X and Facebook.

Some media organizations argue that public funding of journalism, even doled out by entities at arm’s length from politicians, erodes the public’s faith in news providers. The Hub, which publishes mostly commentary and receives the bulk of its funding from two conservative foundations, has posted several such arguments.

But Crabbe-Field emphasized that "the bleeding in the journalism industry" is dire and trusting the market to staunch the wounds won’t insure its survival.

Still needed are policies that tackle monopolistic ad models, encourage publishers to explore innovative news models and ensure trained reporters can make a decent living.

"If we think media is a public good," said Crabbe-Field, "we need more public funding."

This article is part of an occasional series on how Canadian media became intertwined with major tech platforms, and how it’s affecting Canadians and their access to journalism.

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