The problem with the federal government's new Online News Act

How Canadians see news online could be forever changed by the federal government’s Bill C-18.

The Online News Act has worked its way through Parliament and would impose a regime on digital platforms that Canadians use every day to get their news.

Under the terms of the bill, small, independent media organizations—known as intermediaries—will have to negotiate with the likes of Meta and Google to pay for sharing links to news seen online in Canada. If they do not, the Canadian Radio-television and Telecommunications Commission (CRTC) will force them into arbitration within six months to do so.

First, the government passed Bill C-11, which will change what people see when searching online and now, Bill C-18 will change what news articles people will see. This potentially has significant implications for journalistic independence and public access to independent news.

The biggest winners will be “legacy” media. The non-partisan Parliamentary Budget Officer’s analysis on the bill reported more than 75% of the funds generated will go to the three largest “legacy” media organizations— the CBC, Rogers and and Bell—leaving less than 25% for all other smaller, independent media.

Many have expressed concern the CBC, which is already funded by taxpayers, will receive payments through this legislation. Conservative MPs and Sen. Claude Carignan presented an amendment to Bill C-18 to exclude the CBC so more of the focus would go to local, ethnic and independent news sources, but it was voted down by the Liberals, NDP and the Bloc Quebecois.

Conservatives believe in having a strong independent media ecosystem.

Committee testimony was received as well on the emergence of generative artificial intelligence (AI) and its effects on the news industry, where warnings were issued about links to news articles online.

One witness, from the Globe and Mail newspaper, said people’s online news viewership could be disrupted in the next six to 12 months quite significantly by the difference that ChatGPT and generative AI is already making (after) only six months.

Michael Geist, the Canada Research Chair in Internet and e-commerce law at the University of Ottawa’s faculty of law has made similar comments on the AI issue.

On the bill itself, he said, “Smaller independent media outlets, who often depend on social media to build their audiences, will bear a disproportionately larger brunt of the harm.”

Bill C-18 was amended by the Senate, but the final bill is still unable to address the commercial, legal and policy challenges posed by generative AI. Therefore, none of those businesses are required to engage in negotiations with Canadian news organizations. These critical AI policy questions will not be decided by Bill C-18, and some say the bill is out of date before being implemented.

Many questions remain regarding the definition of the legislation and how it will be applied. The government's prescription of new and continuing roles to the CRTC has stretched its mandate beyond all recognition and capability.

The CRTC is now tasked with the massive undertaking of implementing Bill C-11 and potentially overseeing the process of online news link sharing with the entire Canadian online news and digital industry with Bill C-18.

In summary, Bill C-18 will make the problem the government is supposedly trying to fix, worse. The losers will be small independent publishers and online innovators.

If the government wants to ensure small, regional, ethnic and rural media get their fair share of ad revenue, they must stop pouring money into traditional “legacy” media, allowing it to lower advertising rates unfairly.

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Tracy Gray is the Conservative MP for Kelowna-Lake Country.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.