Canadian Heritage Committee on Dec. 5th, 2023

[The Chair, Liberal, Hedy Fry]

I call this meeting to order.

Good morning, everyone.

Welcome to meeting No. 103 of the House of Commons Standing Committee on Canadian Heritage.

I would like to acknowledge that this meeting is taking place on the unceded traditional territory of the Algonquin Anishinaabe people.

While public health authorities and the Board of Internal Economy no longer require mask-wearing indoors or on the precinct, masks and respirators are still excellent tools to prevent the spread of COVID-19 and other respiratory diseases. Their use is strongly encouraged, because these diseases are on the rise now.

I want to take this opportunity to remind all participants about some simple housekeeping.

You're not allowed to take screenshots of the proceedings, because it will be out there on the web later on.

This room is equipped with a powerful audio system. When you are speaking, it's really important that you not have other devices around to cause feedback. When you finish speaking, just press and turn off the mic. When you turn it on, be really careful that you're not echoing in the room, because it really affects the ears of the interpreters.

Finally, I want to remind everyone that questions go through the chair. This goes for the committee members as well.

Also, I will give you a 30-second heads-up when your time is up, so you will need to start thinking about how you will end your sentence.

I will also remind you that the way we speak to each other is really important. At committee and in parliamentary proceedings, it's important for us to be respectful of each other. We can differ, absolutely. That's what most of these meetings are about—differing and being argumentative with each other, etc. However, let's try to do this with a certain amount of decorum.

I want to thank the witnesses for coming today.

As you know, we're doing a study on the tech giants. This has been a real problem for us after the passage of Bill C-18.

As individuals, we have Peter Menzies and Pierre Trudel, who is a professor in the public law research centre at the Université de Montréal law school. We have the American Economic Liberties Project, Dr. Erik Peinert, research manager. We have the Center for Journalism and Liberty, Open Markets Institute, Dr. Courtney Radsch, director.

The Hub is in your notes, but they're not coming today. They are going to come another day.

Lastly, we have, from Unifor, Marc Hollin, national representative, and Julie Kotsis, media representative, national executive board.

I will begin.

You will all have five minutes to present. I will give you that 30-second shout-out so you can wrap it up. If you don't get to finish your presentation, remember that you can get your little bits in during the Q and A period.

Now, the five minutes is per organization, not per person, so if you're sharing your time in your organization, remember that you have only five minutes.

I'll begin with Peter Menzies and Pierre Trudel.

Peter Menzies is an individual and then Pierre Trudel is another individual.

Peter Menzies, please begin, for five minutes.

[Peter Menzies, As an Individual]

Thank you.

I hope I can provide some constructive remarks that you can take forward to help Canada's news organizations flourish once again.

First, though, I wish to clarify a couple of points.

I represent only myself. The blend of my experiences of three decades in journalism and a decade with the CRTC has given me a relatively unique perspective. I have been outspoken in raising the alarm concerning the problematic unintended consequences of legislation, much of which has unfortunately come to pass.

I've always done so only on behalf of myself. I am not a member of any political party, federal or provincial, nor do I contribute to any. I am not a member of any organization, a paid lobbyist or a shill for big tech, as has been inferred. I am just a citizen with a passion for sensible public policy and independent, competitive journalism.

I have no intention of retelling the story of Bill C-18. You all know that well enough.

The role of journalists in society is often described as being to hold the powerful to account, but in Canada, we now unfortunately have a news ecosystem in which most of our journalists could soon have at least half of their pay dependent on the government, Google and any other offshore money the CRTC might come up with as a result of hearings this week. Given that the two most powerful entities in our society are governments and large data-vacuuming tech companies, this is not where we want to be, for as much as the news organizations and journalists involved may swear on their mothers' graves that these realities do not and will not influence their coverage, what they say or how they view the situation, frankly, doesn't matter.

What matters is what the people who read, watch and listen to their news think. While, for sure, some people won't care, a great many will believe that news organizations are fatally compromised. As a result, the public's faith in journalists will continue to wither, and trust in journalism will eventually die. Many will increasingly come to see news organizations as businesses that saved their skin by selling their souls.

We need to find a better way forward. To that end, I recommend to you “And now, the news”, a policy paper authored by myself and Konrad von Finckenstein, published this spring by the Macdonald-Laurier Institute. It calls for the development of a national news industry policy framework that would ensure that the news consumer is served by a healthy, modern, competitive and refreshed news ecosystem that delivers fair, balanced and accurate news that is trusted.

There's a lot to unpack in that paper, but there is one recommendation in it that you can act on, beginning right away. Get the CBC out of the advertising business.

There will be no flourishing for news organizations until the CBC's dualistic distortion of the marketplace is replaced with a level playing field. We will never have one of those, provided the CBC continues to compete for advertising revenue while being paid $1.3 billion a year by Parliament to be a public broadcaster.

That money is intended to allow the CBC to achieve its public mandate, and no doubt much of it does. However, it also allows the CBC to out-resource companies like The Globe and Mail, the Toronto Star, Postmedia, Le Devoir and dozens of smaller start-ups, while soaking up as much as $400 million in advertising revenue. That's significantly more than all the government and Google supports combined.

This is not to say there is not a role for a public broadcaster, but that's not what we have. What we have is a publicly funded commercial broadcaster and online platform.

Meanwhile, TVA and CTV lay people off and Quebecor and Bell are begging the CRTC to get Netflix and Disney+ to subsidize their newsrooms. It's ridiculous.

A flourishing future for a free and independent press in this country is just not possible so long as the CBC exists not as a pure play public broadcaster but as a publicly funded commercial broadcaster and online platform operator. No industry could thrive in such circumstances.

CBC/SRC needs to be stripped of its ability to earn domestic advertising revenues and needs to streamline its operations to focus on its mandate and make its news freely available to others. Immediately eliminating it as a recipient of the Google fund would be a good start.

Thank you.

[The Chair, Liberal, Hedy Fry]

Thank you very much.

I now go to Mr. Trudel, professor at the public law research centre at the Université de Montréal.

[Pierre Trudel, Professor, Public Law Research Center, Université de Montréal, Law School, As an Individual]

Thank you, Madam Chair.

I'm a professor of media law and information technology law. I was a member of the Yale committee, a group of experts on updating Canada's communications statutes. Almost three years ago now, we tabled a report entitled "Canada's Communications Future: Time to Act". However, it's as an individual, a university professor and and an observer of trends that I have prepared this short address.

The subject mentioned in the notice of meeting, and which appears to be what you are working on, is the current and ongoing use of intimidation and subversion tactics by the tech giants to evade regulation in Canada and elsewhere around the world. I'm going to make three comments about this practice or propensity by the tech giants as they attempt to evade regulation in countries just about everywhere around the world.

My first comment is about how urgent it is for all countries—and Canada in particular because it's a medium-sized country and not a major player on the planet in these areas—to strengthen their co-operation with other democratic states. The world will be operating as a network from now on, and countries urgently need to do more to coordinate their efforts and improve their ability to anticipate dominant trends, particularly in technological developments, and their impact on policy objectives. For Canada in particular, this means anticipating much more proactively than it has in the past, the effects of these technological mutations on the Internet as we know it, because they present significant challenges to achieving Canada's political and cultural objectives.

My second comment is on the need to update its legislation to put an end the free ride the tech giants have had so far, owing to our failure to impose ground rules currently applicable to all Canadian firms. I believe that giving these multinationals carte blanche over the past two decades was a horrible mistake. It's urgent to make up for lost time, and it will be difficult.

My third and final comment is to remind everyone that the practices of multinational firms, and their various technical configurations, establish regulations by default. Consequently, the real question is to know whether these default regulations put in place by the tech giants are compatible with Canadian values as reflected in our laws. The purpose of these laws is to promote the growth of Canadian culture and Canada's information universe.

For example, is it compatible with our values to allow the algorithms designed to maximize the value of the massive data used by the web companies to generate advertising revenue, and to maximize the risk of harassment against members of the community or vulnerable people? I would say no, it's not compatible with our values. That's why it's imperative to stop giving the multinationals the freedom to impose their rules and values. It has in many instances led to highly deplorable consequences, including the dismantling of our media industries.

Thank you.

[The Chair, Liberal, Hedy Fry]

Thank you very much. It's all within time. You guys are being very good about that. Thank you.

I now go to the American Economic Liberties Project, Dr. Erik Peinert, research manager.

You have five minutes, please.

[Dr. Erik Peinert, Research Manager, American Economic Liberties Project]

Hello, my name [Technical difficulty—Editor]

[The Chair, Liberal, Hedy Fry]

Can you stop for a minute, please, so we can see what's going on? We cannot hear you. There's a problem. We're going to try to fix this.

Can we suspend for a second while that's dealt with?

Thank you.

Mr. Peinert, please begin. You have five minutes. Thank you.

[Dr. Erik Peinert]

Thank you.

Hello, my name is Erik Peinert. I am the research manager at the American Economic Liberties Project, a Washington, D.C.-based policy and advocacy organization focused on reducing concentrated economic power and broadening opportunity for small businesses, workers and communities. I earned a Ph.D. from Brown University [Technical difficulty—Editor]

[The Chair, Liberal, Hedy Fry]

Once again, we're having some trouble.

Excuse me, Mr. Peinert, we're having some trouble hearing you. Can I let you and somebody on the floor, the audio people, work it out?

I'm going to move to the next witness, just in the interests of time.

I will go to the Center for Journalism and Liberty, Open Markets Institute, Dr. Courtney Radsch, director.

You may begin, please, for five minutes.

[Dr. Courtney Radsch, Director , Center for Journalism and Liberty, Open Markets Institute]

Thank you for inviting me to testify.

My name is Courtney Radsch, and I'm the director of the Center for Journalism and Liberty at the Open Markets Institute, and a researcher and affiliated fellow at several institutions including UCLA and the Center for International Governance Innovation (CIGI).

I’ve spent the past 20 years of my career as a journalist and researcher, and I have never received funding from a tech giant for my research. The Open Markets Institute does not accept any funding from tech giants, making us a rare independent voice on technology policy and journalism.

In fact, what happened to Open Markets is emblematic of the way tech giants wield their money and power to intimidate and to bully. The Google-funded think tank New America Foundation fired Barry Lynn, our executive director, and exiled staff in 2017 after OMI issued a statement praising one of the first penalties that the European Commission imposed on Google for anti-competitive conduct. This is not a unique example of how big tech manipulates institutions to dissuade critical research while it also funds them to produce “research” that supports its positions and advocates for positions to further big tech interests.

Just yesterday, renowned disinformation scholar Dr. Joan Donovan filed a whistle-blower complaint against Harvard for retaliating against her after the university received a record half billion dollars from The Chan Zuckerberg Initiative. As the complaint notes, Dr. Donovan’s work was “particularly timely as it is used to inform policymakers as they legislate”.

Indeed, much of what we know about how these opaque oligopolies operate is because journalists and researchers have ferreted it out or a whistle-blower leaked it.

I will cover just five ways, briefly, that big tech deployed its vast resources and charitable arms to evade regulation, to influence research and journalistic coverage, and to intimidate critics and undermine legal regulatory oversight. While the playbook borrows from big tobacco, big oil and big pharma, the manipulation is intensified through the use of their own platforms to manipulate public opinion and to censor their critics.

[Martin Champoux, Bloc, Drummond, QC]

Madam Chair, I have a point of order.

[The Chair, Liberal, Hedy Fry]

Yes.

[Martin Champoux, Bloc, Drummond, QC]

Madam Chair, with all due respect for our witness, would it be possible to ask her to slow down so that our interpreters can do their work properly?

[The Chair, Liberal, Hedy Fry]

Dr. Radsch, could you please slow down so the interpreters can translate into French for some of the members of our committee?

Thank you.

[Dr. Courtney Radsch]

Yes.

Sorry about that.

First, tech giants use their platforms to propagandize against regulation they oppose, distorting public perception and debate. We saw this in Australia, Canada, Brazil and the U.S. with news media bargaining legislation. Google used its search page to advocate against proposed laws, and reportedly told evangelical preachers in Brazil that they would no longer be able to quote the Bible online. The Brazilian judiciary accused Google of undue influence in the legislative process.

Second, tech giants censor news and withdraw access to data and APIs, as well as threatening to leave entire markets to avoid meaningful regulation and deter oversight. Meta even impeded sharing links from Australian government sites during parliamentary deliberations about the bargaining code there as part of its negotiation tactics, according to a whistle-blower.

Google and Meta have threatened to ditch news entirely, despite the fact that disinformation degrades their platforms while news provides greater value and a better user experience, and they have pressured news outlets to kill stories, including coverage of a recent study that estimated they owe U.S. publishers more than $12 billion a year. This pattern of censorship and distortion can also be seen in motions to suppress information, destruction of evidence and obstacles to public scrutiny, as with the historic antitrust trial against Google happening now in D.C., where it opposed audio livestreaming.

Third, they undermine democratic institutions, seek to handicap regulatory agencies and evade laws they don't like. We saw this in Meta's decision to censor news in Canada rather than comply with Bill C-18, and in its lawsuit against the FTC over attempts to force the company to comply with restrictions on data gathering.

Fourth, big tech companies spend more money in Washington, Brussels and other world capitals than virtually any other sector, through direct lobbying and by funding industry groups and fellowships that help shape how policy-makers think about issues they regulate, putting big tech-funded experts into the heart of policy-making.

Fifth and finally, big tech provides funding to most civil society, research and advocacy groups working in tech policy, digital rights, AI governance and the media bargaining code space, as well as journalism.

I do not want to disparage the work of these organizations, but the perception of interference, along with the potential to divert attention for more important and consequential issues, is a way to subvert demand for regulation. Research shows that big tech funding to media correlates with countries where governments are considering fair compensation legislation, and now AI companies are following the same playbook.

In conclusion, big tech companies generate chaos and disruption, which then they leverage to blame governments for crafting unworkable regulation that only becomes workable once modifications that benefit them the most are made.

[The Chair, Liberal, Hedy Fry]

Thank you very much, Dr. Radsch.

Are we ready to go to Dr. Peinert? No? Yes? I will move on until I am told that we're ready to do that.

We now have Unifor, with Mr. Marc Hollin, national representative, and Julie Kotsis, media representative, national executive board.

I don't know who's going to speak, or if you're going to share your time, or what.

All right, Ms. Kotsis. Go ahead, please.

[Julie Kotsis, Media Representative, National Executive Board, Unifor]

Thank you very much.

Good morning, Madam Chair and members of the Standing Committee on Canadian Heritage. It's my honour to join you today to make a representation on behalf of Unifor.

My name is Julie Kotsis, and I am chair of the Unifor media council. Unifor is one of Canada's largest unions in the media sector, representing more than 10,000 media workers, including members in broadcast television, newspapers, digital news publishing, film and TV production, and graphics and printing.

While you consider all of the important evidence you've been gathering through the standing committee, I'd like to share another critical perspective, the experience of journalists and media workers and how the future of local news and the people who make that news has been thrown into crisis by the disruptive influence of tech giants.

In my time at the Windsor Star, I have witnessed a profound and troubling transformation of the newspaper business in Canada. Canada's newsrooms are shrinking. Other newspapers have gone through the same painful downsizing. Just as an example, in 2009, Unifor's membership at the Toronto Star totalled 610. It was down to 178 in 2022. The same is true for broadcast news.

This year alone, more than 100 Unifor members in the broadcast segment lost their jobs. We know that not everyone is concerned that journalists and media workers are losing their livelihoods. What should concern everyone, however, is the impact that the loss of local news has on the fabric of our democracy. Local news is how Canadians learn about the world and what's going on around us. It's one of the ways that we hold governments and corporations accountable. Local news is how we gather vital information about natural disasters like this year's forest fires or floods.

While this is, perhaps, an obvious point, what puts journalists and media workers at the heart of this discussion is that they are the ones who create local news. They have the training, experience and professional standards to provide high-quality, fact-based journalism.

We've heard some experts and witnesses framing this discussion as the fight for the free flow of information online and the very notion of a free and open Internet. Even if this discussion was about the very notion of a free and open Internet, tech giants like Google and Meta are the very last organizations we should be looking to for guidance.

This committee has already heard countless examples of how the tech giants control what we access online using opaque and ever-changing algorithms that they hide from users and regulators and protect at all costs. They collect our data and sell it for profit. They control every aspect of online advertising, frequently allowing for the proliferation of toxic and hate-filled harassment and abuse on their platforms. I will tell you that a great deal of that harassment and abuse is aimed at journalists and media workers, including members of Unifor.

I would like to take a moment to talk about the harassment of journalists and media workers. This is an issue that our union takes very seriously. In February of this year, we released a comprehensive discussion paper called “Breaking the News: Media Workers Under Attack”. As part of that discussion paper, we undertook a membership survey about harassment and abuse.

It won't surprise you to know that, according to Unifor media workers, messages on Facebook and Twitter were a key vehicle for harassment and abuse by members of the public. Unifor media workers know that the argument about a free and open Internet is a red herring. To reiterate, this is really about the ability of governments to enact meaningful rules and the willingness of the tech giants to abide by those rules. To put it plainly, our members are used to standing up to powerful global corporations and, as good trade unionists, we know that we must stand up to bullies together.

In fact, I'd like to return to some basic union principles as I wrap up my comments. For us, solidarity is about finding common ground and standing together, even if not all of our interests are totally the same. We know, all too well, that one worker standing alone against an employer is almost powerless, but when we come together, we have collective power. We respectfully encourage elected officials and the federal government to work together in solidarity and with jurisdictions around the world to establish rules that will rein in the unchecked power of the tech giants.

Thank you.

[The Chair, Liberal, Hedy Fry]

Thank you very much, Ms. Kotsis.

We're going to try Dr. Peinert again. He's from the American Economic Liberties Project.

Let's go for five minutes, please.

[Dr. Erik Peinert]

Thank you. Hopefully it works this time.

Hello. My name is Erik Peinert. I'm the research manager at the American Economic Liberties Project, a Washington, D.C.-based policy [Technical difficulty—Editor]

[The Clerk of the Committee, Ms. Geneviève Desjardins]

I'm sorry, Mr. Peinert, but we're having issues with the sound again.

[The Chair, Liberal, Hedy Fry]

I'm sorry, Mr. Peinert. There's absolute static on your end. You've talked to someone here from the committee, and you've tried to fix it, so I don't know what we're going to suggest.

To the audio people, if we lost the picture, but listened to him on audio—we know what he looks like now—would that make a difference? I have found in certain international meetings that it does. Can we try that?

Okay—let's try losing the picture and going with your disembodied voice.

Thank you.

[Dr. Erik Peinert]

Okay—we will try that.

I will continue where I left off.

I earned a Ph.D. from Brown University, where my research focused on competition, monopoly and antitrust and has been published in leading academic journals.

Thank you for the opportunity to speak today about big tech's pattern of coercion in response to regulation and specifically Meta's recent action to block Canadian access to news articles across its platforms in retaliation for the passage of Bill C-18, the Online News Act. This follows a nearly identical action in 2021 by Meta, then Facebook, to extract concessions from Australia with respect to its news media bargaining code.

This discussion comes at a time when the news industry across the globe is in peril. It's an industry I've watched closely since I was a child. I was raised by a journalist. My mother began her career as a reporter for a local paper in rural New England, moving to various editorial roles in minor cities, to the newsroom at The Boston Globe, and then to executive positions at The Boston Globe and GateHouse Media, now Gannett. She now owns several successful, independent local papers in Massachusetts suburbs.

My personal and professional experiences lead me to make two principal points today, the first being about the platforms' business models in this market.

Media companies pay to produce and distribute content that a large mass of readers find valuable. They then sell ads to businesses that want their offerings in front of those readers. On one side, Meta and Google have become a central way for readers to access news media, which gives them power over journalism outlets, with an implicit threat to cut off readership.

On the other side, Meta and Google also have an effective duopoly over digital advertising, and both face or have faced antitrust lawsuits for illegal monopolization in this space.

These companies are not providing viewership so much as using their dual control over Internet traffic and advertising to monetize content that journalists produce at considerable expense. Recent research by economists at the University of Zurich indicates that 40% of Google's total revenue from search advertising would go to publishers and other journalism outlets if it faced more competition. With media companies paying to produce the product [Technical difficulty—Editor]

[The Clerk]

I'm sorry, Mr. Peinert, but we're having issues with the sound again.

[The Chair, Liberal, Hedy Fry]

We heard some of the things you were trying to say.

Can we just try one more time?

[The Clerk]

The only issue would be that change of sound, which might hurt the interpreters.