The Canadian government has announced it will halt annual expenditures of CAD 10 million (approximately Rs. 62 crore) on advertisements across Facebook and Instagram, following a conflict surrounding a newly established law requiring online news publishers to be compensated. Heritage Minister Pablo Rodriguez communicated this decision on Wednesday.
Despite the ongoing dispute, Rodriguez expressed optimism about the possibility of finding a resolution. He indicated that both Meta and Alphabet’s Google had threatened to terminate access to news content on their platforms in Canada as tensions escalated.
This standoff follows the passage of Bill C-18, known as the Online News Act, last month. The government is currently in the process of finalizing regulations that would mandate these platforms to share advertising revenue with news organizations prior to the law’s implementation by the end of the year.
“We cannot continue paying advertising dollars to Meta while they refuse to pay their fair share to Canadian news organizations,” Rodriguez stated.
The legislation was formulated in response to demands from the Canadian media sector for stricter regulation of major internet companies. The objective is to enable news enterprises to recover financial losses incurred during the years in which Facebook and Google expanded their dominance in the online advertising landscape.
Meta did not provide an immediate response to the announcement. The company has previously asserted that news content lacks economic value for its operations and that news organizations gain advantages from publicizing their stories on social media.
Additionally, Canadian telecommunications firm Quebecor and radio operator Cogeco also declared their decision to cease advertising on Facebook and Instagram due to Meta’s resistance to the new legislation.
© Thomson Reuters 2023
