The story so far: On October 21, Meta threatened to block news content from Facebook in Canada. The company claimed it was not invited by authorities to share its concerns on Canada’s Online News Act introduced in April. The law can force social media platforms like Facebook and Google to pay news publishers for their content.
What is Canada’s new Online News Act?
The law lays down rules that mandate platforms like Meta’s Facebook and Alphabet’s Google to negotiate deals with news publications. Tech companies like Facebook profit from the work of news publications and hence must get a chance to negotiate fair deals with them, Pablo Rodrigues, Heritage Minister of Canada said in a statement.
Through the new legislation Canada aims to ensure sustainability in the country’s new ecosystem, maintain press independence, market innovation and diversity in the Canadian news landscape. The law is based on the idea that social media platforms have an advantage when it comes to negotiations with news publishers and these deals should be assessed by a regulator to ensure parity.
The Canadian government says it is looking to establish a “flexible regulatory framework that facilitates fair business relationships between digital platforms and news outlets”. The law brings under its ambit qualified Canadian journalism organisations, entities that produce news content, operate in Canada and employ two or more journalists, according to the Government of Canada’s website.
Why does Facebook oppose the News Act?
The U.S.-based social media giant said that the act “misrepresents the relationship between platforms and news publishers”. The act will force it to pay news organisations for content that publishers share voluntarily on Facebook. Publishers will be able to charge Meta for as much content as they want to supply at a price with no clear limits, Meta said.
The company alleged that the act will stifle innovation as it “unfairly subsidises legacy media companies” and will “harm competition, reduce trust in media and make the transition to digital models even more difficult”. Meta has gone as far to say that the current legislation presumes that it unfairly benefits from its relationship with publishers when the reverse of this was true. The media platform also said that news articles make up less than 3% of what users see on their Facebook feed and are therefore not a significant source of revenue for the company.
Are there similar legislations in other parts of the world?
Canada is not the first country to ask social media platforms to compensate news organisations. Australia passed a similar legislation in 2021.
Australia had passed the legislation to ensure that news media organisations were fairly compensated for the content they generated.
Facebook and Google opposed the law. Facebook blocked news on its Australian platform but after amendments in the legislation, it resumed its news services.
Alphabet owned Google said it would shut down its search engine in the country.