Hon. Donna Dasko: Honourable senators, I rise today to speak to Bill C-18, the online news act, at second reading. I take a great interest in this bill. I have loved newspapers from an early age. I grew up with the Winnipeg Free Press, which has just turned 150 years old, and I added a whole set of papers to my must-read list in later years. During my career in the public opinion business, I had the pleasure of working with The Globe and Mail to lead their first-ever public opinion polling program. As well, later, I led many years of polling assignments for the CBC. So I learned a few things about journalism and the media business along the way.

Now, as we turn to Bill C-18, we learn that the news media business is in trouble and that the government has come to fix it. The rationale behind Bill C-18 is that news organizations are not getting fair compensation for the news they produce from the digital platforms that distribute this news to the public. Thus, Bill C-18 would require that major digital platforms make deals with news businesses to pay them for information that is shared on their platforms. The news businesses involved include online news outlets, newspapers and news magazines, public and private broadcasters and local businesses that publish original online news content.

Although no platforms are mentioned specifically, it appears that Google and Facebook would be the eligible platforms according to the criteria laid out. If voluntary deals are made between platforms and news media within certain timelines that meet certain criteria, digital platforms would be exempted from the required portion of the act, which is to enter into a formal negotiation process that could lead to final offer arbitration. The CRTC will take the role in developing a code of conduct to guide the bargaining process and determine if the agreements that are reached meet the conditions for exemption, among other roles that it will have.

This is a complex bill. After sifting through government documents, reading media clippings and talking to stakeholders, I can best analyze it by dividing it into two parts: the parts that make sense to me and the parts that leave me with a whole lot of questions. Much of the stated context and background makes sense. Two assumptions are especially relevant. First, news media are an essential component in a democracy and, second, technological change has changed the way that news is consumed and distributed in this country, which has left Canadian news media in a vulnerable state.

Democracy depends on free and fair elections, an independent judiciary, the rule of law and a free and independent media. With democracies around the world under threat, I think we have to be more vigilant than ever about our democratic institutions. A free and independent media is vital to inform, investigate, analyze and engage Canadians in the public space. The second assumption is a familiar one: that digital technology has changed the media in this country forever.

Let’s start with advertising. A 2021 Statistics Canada report surveying newspaper publishers in Canada revealed that the operating revenue of Canadian newspaper publishers declined to $2.1 billion in 2020 — down a full 22% just from 2018. Declines in revenues have inevitably led to closures and job losses. Over 469 news outlets have closed from 2008 to 2022 — including over 300 community newspapers — and one third of journalism jobs have disappeared since 2010.

The other side of this picture is that the internet has increased its share of advertising revenue as that of newspapers and other media has declined. In 2005, the internet held only about 8% of the market share of all advertising revenue in Canada. By 2015, the internet share was 37% while all other categories had dropped, especially daily newspapers, which fell from 26% to a 12% share in 2015.

Government background documents estimate that Google and Facebook revenue from digital advertising was $9.7 billion in Canada in 2021, which was 80% of the total digital ad revenue of about $12 billion.

It’s no mystery as to why advertising has shifted to internet platforms. That’s where the consumers have gone to find, read and share news. The online environment today includes a vast array of choices, including new media, traditional media and social media.

When it comes to consumers, it’s important to understand that Canadians are still very interested in news and have not abandoned traditional news sources even as they have gone online to get this information. According to a Maru survey conducted last year, 86% of Canadians access news every day. According to a Reuters survey of 46 countries, 77% of Canadians used the internet in the last week as a source of news. In this study, the top sources for news are essentially the same whether consumers are online or offline. For English media in Canada, the top sources are CTV, CBC and Global News. For French media, they are TVA and Radio-Canada. Still, the study shows that while 56% of Canadians watch actual television news during the week, only 16% read an actual print newspaper.

With regard to consumer behaviour, a 2022 Abacus survey of Canadians commissioned by Google shows that 64% of Canadians say they use Google to find and access news at least a few times a week, and 41% use Google daily for news. This finding strengthens the case for the importance of platforms as a source of news for Canadians.

Now, as an aside, I wish that the government had included more in-depth analysis of consumer behaviour in its development of the bill, but I will leave that topic for another day.

I think a strong case can be made that Canadian media need assistance to carry out important democratic functions that have been weakened by years of revenue losses. I feel that a public policy response is justified for this reason. However, this is where my questions about Bill C-18 begin.

Let’s start with the choice of this policy framework. I want to know more about why the government has chosen this particular response rather than modifying or developing existing policy tools which are more familiar to this industry. Creating a fund to assist organizations, for example, like the Canada Media Fund, would have been more straightforward. Instead, the profitable platforms will be required to compensate the news sources directly through a very unfamiliar process.

Other questions are raised with respect to the eligibility of news businesses. Our colleagues in the other place, through amendment, have greatly expanded the number of media organizations that will be eligible to participate in this policy from about 200 to more than 650. It’s a positive development to include smaller and more diverse organizations, but this also raises questions. Will all of these organizations practise real journalism with true news content and journalistic practices? What body will investigate this, if at all?

It also appears that organizations will not need online content to be eligible. If this is the case, how can digital platforms benefit from their content for purposes of payment? That’s the purpose of the bill in the first place. Also, if we’re tripling the number of organizations, will this mean less support for everyone in the end or will the platforms have to pony up more dollars?

Another question relates to the basis of negotiation between the parties, that is, between the platforms and media organizations. What are the considerations? The government has relied strongly on the concept of fair remuneration. It wants to ensure that major digital platforms fairly compensate news publishers for their content and enhance fairness in the Canadian digital news marketplace, backstopped by the Canadian Radio‑television and Telecommunications Commission, or CRTC, and arbitration.

The term “fairness” is used repeatedly in its communications, but what does this mean? We know that news organizations themselves receive significant value from the distribution of their content, so how, if at all, does this figure into it? In the end, is remuneration based only on measures of the media organization and, if so, which ones? The volume of its online content? The size of its online audience? A percentage of its expenditure on news content? It has been suggested 20%. Another suggestion is 30% to 35%. Is remuneration based on platform measures such as the volume of online activity of the organization on the platform or on the revenues of the platform? I think we need a greater understanding of this process since it directly affects outcomes and the achievement of policy goals.

I have further questions about the feasibility of negotiations. How will small regional newspapers hold their own in the high stakes bargaining that will take place under Bill C-18? In the end, will the big legacy companies come out the winners at the expense of others?

Colleagues, there is more. The platforms are supposed to:

. . . ensure that an appropriate portion of the compensation will be used by the news businesses to support the production of . . . news content.

I want to understand how this is supposed to be implemented.

Many other questions are relevant, but, in the end, I would ask whether this policy initiative will be the saviour of this industry. I hope that we can find some answers to these and other questions at committee.

There are many good elements of Bill C-18. It enjoys the support of stakeholders across the media industries, including many large and small newspapers, broadcasters and more. I also see support from the Canadian public for some of the principles of this bill.

For example, a poll conducted last year by Pollara for News Media Canada shows that 79% of Canadians agree that Google and Facebook should have to share some of the revenue they generate from Canadian news content with the Canadian media outlets that produce the stories.

On the topic of polls, that Abacus Data poll conducted for Google, which I mentioned earlier, shows that two thirds of Canadians don’t want Google Search to change the way it operates when Bill C-18 comes into effect. Yet, we have just seen Google two weeks ago blocking news content in a test run related to this bill. This company is doing exactly the opposite of what Canadians want, according to the company’s own polling.

Colleagues, there is never a dull moment working on these files, and never a dull moment on our Senate Transport and Communications Committee. Clearly, there are many important issues and questions which need examination with respect to Bill C-18. I look forward to the several weeks of study and debate at committee and here in our chamber where Bill C-18 will receive the sober second thought it so clearly needs.

Thank you, merci.