OPINION: Bill C-18 hypocritical in face of taxpayer-funded news placement service

If the federal government wants to ensure Canadian news media outlets get paid their fair share, I will suggest some low-hanging fruit as a starting point: stop spending taxpayer money on a publicity company to produce your own news stories and distribute them to editors who could benefit from advertising dollars.

Canadians can’t see most news content on Facebook or Instagram any longer because of Meta’s response to the federal government’s Bill C-18, the Online News Act.

The bill required Meta to reward news media publishers with royalties for clicks on links to their content, in order to “in order to enhance fairness in the Canadian digital news market.”

In response, the tech giant says it would be “unworkable” to fulfill the legislation’s demands by developing an apparatus to reward publishers for links to their content. To be compliant, they opted to prohibit Canadians from seeing any news.

We’re left in a lose-lose situation where news media outlets simply see less traffic from social media referrals, and as a result, stand to actually lose revenue.

According to the Reuters Institute’s 2023 Digital News Report, 29 per cent of Canadians use Facebook for news.

And a quick look at local community Facebook groups will show you people are still sharing news content on Meta platforms – they are simply copying and pasting the entire contents of news articles into posts when they want to discuss a story, ensuring the publisher gets no traffic from ad revenue.

Trying to convince American technology companies to pay Canadian news publishers is a complex challenge. An easy first step for the government to start ensuring fair payment for news outlets would be to redirect the money they spend on media placement contracts with companies like News Canada towards actual media outlets.

In 2016, the Halifax Examiner published a story I wrote investigating the federal government’s contracts with News Canada Inc.

News Canada is a publicity company distributing free, pre-produced stories for community media outlets to use when they don’t have enough original content to fill up their radio broadcast or newspaper. This process is called “earned media.”

In 2020, the federal government awarded a two-year non-competitive tender to News Canada, estimated at a value of $1.25 million a year. They recently amended the contract to last until the end of January 2024.

The tender is for News Canada to produce and distribute government-approved multimedia and text news content that no consumer would reasonably guess was produced by the government.

It’s a standing offer for News Canada to provide “communication support services to obtain earned coverage in Canadian media guaranteed on an as when required basis”. 

The tender calls for News Canada to share radio broadcast clips, online videos and text stories with over 2,600 newspapers and web editors across Canada with an audience guarantee included for the news article distribution service.

For an example of the content, a government-approved story made ready for distribution this month by News Canada on Canada’s climate action incentive payment is headlined: “What is the Climate Action Incentive payment, and how do you get it?

The article begins with “(NC)” which signifies it was produced by News Canada. This is similar to how stories newspapers publish that originate from actual newswire services like Canadian Press or Associated Press begin with (CP) or (AP).

The rest of the article goes on to describe how “the CAIP is a federal program that helps individuals and families,” and ends with a link to a page on Canada.ca. 

But nothing in the article indicates the content was actually funded by the Canadian government, obscuring the contents’ origins.

One reason this is happening – if you are a government agency that wants to get a message out, it’s a lot easier to pay a publicity company to put out a digestible message easily shared by news outlets operating with skeleton crews, than to pay those news outlets directly for advertising. 

Federal government advertising purchases are regulated through complex “mandatory procedures for advertising” you can ignore by putting a message out through the News Canada contract.

Over 2021 to 2022, the Government of Canada spent a total of $50.25 million on advertising purchases in “traditional” media – $32.07 million on television, $11.67 on radio, and $6.51 for print media.

They strongly prioritize digital media spending – algorithm-served “display programmatic ads” on sites like YouTube saw $25.46 million in spending, followed by social media at $21.21 million, $9.90 million on search engine ads, and other digital ads at $7.49 million.

If the standing offer contract with News Canada is estimated at $1.25 million a year, that’s not an insignificant amount next to the $50.25 million spent on traditional media. It’s money that the community news outlets who are actually printing these government press releases, because they are operating on a skeleton crew of reporters due to budget cuts, could be using to fund their own reporting.

If we want to enhance fairness in the Canadian news market, let’s cut out the practice of having taxpayers fund publicity middlemen. That $1.25 million could put real ads in newspapers and fund grants and subsidies for community newspapers.

For now, The Lunenburg Barnacle does not meet exclusion criteria for Canadians’ Meta feeds – and I’m grateful, because that means it’s easy for us as a volunteer-operated new media organization to directly connect with our community when we share important stories not being published anywhere else, like in-depth coverage of the local Mayoral election

Referrals from social media account for more than 30 per cent of our web traffic, and we witness the growth in our readership as our stories are shared on the social platforms where people already spend time.

And for the record, according to the Toronto Star and others who published the Canadian Press story following our reporting on the Town of Lunenburg’s potential divestment of the Lunenburg Academy, which included the line – “News of the sale came to light in a report by local news outlet the Lunenburg Barnacle […]” – we are officially a news outlet.


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