The Canadian government has recently announced plans to remove all its advertisements from Facebook and Instagram, responding to Meta Platforms’ decision to limit news content access for the country's citizens.
This action resulted from a recent law passed by the Canadian parliament, compelling tech giants to pay for news content.
In reaction to the Online News Act (also known as Bill C-18), Google previously also confirmed plans to restrict Canadian news once the law came into effect.
Despite this, Canadian officials remain optimistic about striking a deal with Google parent Alphabet to prevent this restriction.
“Google's concerns can be met by what we plan to do in the regulations,” Heritage Minister Pablo Rodriguez told reporters on Wednesday, noting that Meta isn’t talking to Canada’s government at the moment and reiterating Meta’s decision is “unreasonable and irresponsible.”
Pulling advertising from Meta's platforms, as estimated by Mr. Rodriguez, could result in a $7.54 million loss for the U.S. tech giant.
Although this is a minor loss compared to Meta's $116 billion revenue from last year, Mr. Rodriguez argued Canada will set a precedent and encourage other countries to follow suit.
Ottawa continues to insist Bill C-18 is necessary to ensure "fair compensation" for struggling news organizations for their content shared on the most popular social media platforms.
Responding to Canada’s decision, Meta told BBC that the act “is flawed legislation that ignores the realities of how our platforms work... Publishers actively choose to post on Facebook and Instagram because it benefits them to do so.”
The world is watching Canada.
— Pablo Rodriguez (@pablorodriguez) July 5, 2023
We will continue standing up for a strong, free and independent press, because tech giants need to pay their fair share. #cdnpolipic.twitter.com/hyQfeyaAyj
Canada Isn’t the First Country to Enforce This Rule
A similar law to Bill C-18 was implemented by Australian authorities in March 2021, albeit with adjustments after Meta temporarily barred Australian users from viewing news on its platforms.
The brief blackout ceased following the amendments, which led to more than 30 deals between Google, Meta, and local media outlets. This bill is believed to have brought up to $150 million per year to media companies.
Meanwhile, Canada's legislation gained attention from other countries looking to enact similar laws, such as the United Kingdom and the United States.
In the U.S., the notion received support from Democratic Senator Amy Klobuchar who advocated for a similar bill in the Senate.
Last month, Meta confirmed it was considering removing news content from Facebook and Instagram in California if state legislators approved the Journalism Preservation Act requiring companies to pay publishers for their content.