The multinational Google announced Friday that it is preparing to remove news content from its search engine in December, dissatisfied with a federal regulation which specifies how it must share its revenues with Canadian media.
“Regretfully, [la nouvelle loi sur les nouvelles en ligne] C-18 is a law that we cannot work with,” explained a Google official during a technical briefing for journalists.
The company presented a voluminous document that details eight changes that constitute the “bare minimum” of its conditions for participating in the Trudeau government’s plan to assume part of the salary bill for the country’s journalists.
In essence, Google finds that the government’s expectations are too complicated in terms of the number of media agreements expected. This is required to be exempt from the costly “mandatory and unrealistic” arbitration process provided for by C-18, and detailed in a recent draft regulation that Google wishes to have modified.
More than a web giant
The online news law, adopted last June under the name C-18 by all political parties in Ottawa except the Conservative Party of Canada, is due to come into force on December 19, 2023.
The other company targeted by this law, Meta, the owner of Facebook and Instagram, immediately indicated that it would never comply and removed the news from its platforms.
The only hopes that C-18 will provide any funding to the media now rest with Google, owned by the Californian company Alphabet. According to the draft regulation, published in September, Ottawa expects to extract around $172 million per year from this company, compared to around $62 million from Facebook, to pay journalists in the country.
This amount would represent approximately 4% of Google’s revenues in Canada, according to federal calculations. Google disputes this number, arguing that no “significant revenue” is made from news, which constitutes about 2% of all searches.
” This amount [de 172 millions évoquée par Ottawa] is far greater than the economic value that Google derives from news queries, and leaves a single company solely responsible for covering an arbitrary and substantial portion of the costs of Canadian news publishers,” we read in Google Canada’s submission to federal consultations, which takes up 12 pages.
No more than 100 million
Questioned by The duty, Google mentioned being ready to put a maximum of 100 million dollars on the table. The company estimates that instead of appropriating media content, traffic redirected to news sites provides them a service worth $250 million per year.
Google fears the bad faith of media companies in the negotiations forced by Ottawa, and would like the regulations on C-18 to provide it with more flexibility and more time to conclude agreements protected from the risk of being dragged before a arbitrator.
The Minister of Canadian Heritage, Pascale St-Onge, indicated this week that she was hopeful of reaching an agreement with Google on this issue. Unlike Meta, the company continued to participate in government consultations and is continuing negotiations to find “a way through” with the Canadian government.
Minister St-Onge promises to publish a final version of the regulations on the application of the law on online news, taking into account the comments of participants in her consultations, which have just ended.
Approximately 93% of Internet searches go through Google, while Microsoft’s competitor Bing claims barely 3% of the market.
Further details will follow.