Canada: Google will pay R$360 million per year for news – 11/29/2023 – Market

Google has agreed to pay 100 million Canadian dollars ($73.55 million) a year into a fund to support news organizations in Canada as part of a settlement with the government, ending a dispute that led to the company to threaten to remove news links from its services.

The agreement ends a six-month impasse following the passage of an online news compensation law designed to direct some of the money that Google and Meta, the parent company of Facebook and Instagram, make from online advertising toward bolstering the companies’ finances. news organizations.

The dispute has turned into the biggest conflict between big tech and a national government over news subsidies since Australia became the first country to pass a law on the issue in 2021.

Meta suspended links to news in Canada earlier this year in protest of the law, and Google threatened to do the same when the law comes into force in mid-December unless the government softened the impact of the legislation.

The search giant resisted being forced to pay for news links on its services, fearing it would set a precedent that could be applied to other types of content.

Internet giants have always maintained that they do not harm news companies, but provide valuable traffic to their sites, with Google claiming that their links generate 250 million Canadian dollars (R$900 million) per year for Canadian publishers.

However, Canada’s Online News Act was explicitly intended to bring what it called “greater fairness” to paying for online news, after the online advertising market was dominated by Google and Meta.

Google also contested that Canadian law would leave it with undefined financial liabilities, as it would be required to negotiate with each company individually and would face an arbitration process that big tech believed was tilted against it.

In a commitment announced Wednesday, Pascale St-Onge, Minister of Canadian Heritage, said the agreement would “benefit the news sector and allow Google to continue playing an important role in providing Canadians with access to trusted content of news”.

Google’s payments should be made to a collective fund, she added, ending the need to negotiate with each publisher separately.

Canadian officials estimated earlier this year that the law would require Google to pay C$172 million to media companies.

It was unclear on Wednesday whether the law’s final regulations, which are expected to be released before it goes into effect on December 19, would still require Google to pay for offering links — something the company strongly disagreed with.

Meta indicated that the agreement with Google would make no difference to its decision to block news links in Canada.

“Unlike search engines, we do not proactively search the internet for news to place in our user feeds, and we have always made clear that the only way to reasonably comply with the Online News Act is to end the availability of news to people in Canada,” he said.