Google Strikes Deal with Canada to Avert News Blockade

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THUNDER BAY – NEWS – Google has reached a pivotal agreement with the Government of Canada to circumvent a potential news blockade triggered by the impending Online News Act, set to come into effect on December 19.

Google had previously issued a stern warning that it would remove news links in Canada in response to this legislation. Meanwhile, social media behemoth Meta, the parent company of Facebook and Instagram, had already initiated news blocking on its platforms in compliance with the law.

After months of intense negotiations between the search giant and Canadian authorities, a mutually acceptable resolution has emerged.

The Online News Act’s Implications

The Online News Act, primarily aimed at Google and Meta, compels tech giants to engage in negotiations and establish payment agreements with news outlets for the use of their content.

Under the agreement announced on Wednesday, Google will pay an annual sum of C$100 million, subject to inflation adjustments, to news outlets.

Canadian Heritage Minister Pascale St-Onge, in an announcement, specified that the funding would benefit a diverse array of news businesses across Canada, including independent news enterprises and those representing Indigenous and official-language minority communities.

According to the statement, Google will remit payments to a “single collective,” which will then allocate the funds to eligible news agencies based on the number of full-time equivalent journalists employed by these businesses.

St-Onge emphasized the importance of a sustainable news ecosystem for the country, expressing concern over newsrooms closing and staff layoffs, which have put the Canadian news industry in a precarious state.

In response, Google issued a statement expressing satisfaction with the Canadian government’s commitment to address their core concerns regarding the legislation. They also affirmed their intention to continue directing valuable web traffic to Canadian publishers while working through the exemption process based on forthcoming regulations.

Controversial Online News Act

Canada’s Online News Act elicited strong reactions from tech companies when it was passed during the summer. While many media groups hailed it as a positive stride toward market fairness, Google labeled the bill as “unworkable” and criticized the decision to put a price on links, asserting that it disrupts the fundamental functioning of the web and search engines.

Meta had already commenced restricting access to Canadian news content on Facebook and Instagram from August 1, displaying messages to users that they cannot view the content in Canada or access any related posts.

Estimates had suggested that news organizations stood to earn as much as C$329 million annually from digital platforms due to the legislation. However, following extensive negotiations, the final compensation figure of C$100 million was agreed upon.

“Google sought clarity on the compensation amount it would be required to pay to Canadian news outlets,” stated Ms. St-Onge during a press briefing in Ottawa.

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