Thank you, Mr. Chair.
Distinguished members of the Standing Committee on Canadian Heritage, thank you for having me here today.
Le Devoir is a newspaper of record that is not like the others. It is part of a select club of media that rely on subscriptions, for both the digital and print versions, to cover their costs. Subscription is working: it brings in nearly two thirds of our revenue and means that we can look to the future with what I would characterize as cautious or relative optimism.
We are able to achieve profitability through careful management, optimum use of Quebec and Canadian tax credit programs, and a revenue diversification program. Le Devoir has been profitable in six of the last eight years. For the past four years, it has even managed to grow, from 100 to 175 employees. I point this out because few media have managed to make this transition while at the same time hiring so many people.
Nonetheless, the transformation involves constant challenges. There are new ones every year, if not every day. The environment is demanding. We have to compete with influential actors that rely on free content and with Google and Meta on the advertising market. We do not have the luxury of taking losses, nor can we count on support from sponsors.
For these reasons, Le Devoir supports Bill C‑18. However, we think it might go a little too far. I will come back to this later.
Of course, you are aware that Le Devoir has signed contractual agreements with four of the digital platforms. Well before the government stated that it intended to legislate, we had signed agreements with MSN in 2014 and with Apple News+ in 2020. For reasons of our own, we got out in front with the agreements signed with Meta in May 2021 and with Google in October 2021. That does not prevent us from supporting Bill C‑18, publicly and privately, and saying that we are going to adhere to the new scheme, obviously.
These agreements were in line with our revenue diversification strategy and made it possible for us to accomplish something important, which is what I would like you to understand today. It enabled us to build renewed relationships with Meta and Google based on trust and collaboration. We knew that sooner or later, the time was going to come for us to bargain with those companies. In fact, that is the central idea of Bill C‑18. Rather than facing them from a position of conflict, we simply chose to bring the point when we had to rebuild the relationship forward.
Given the foregoing, it is important for us to be able to bargain individually within the framework of the bill. At Le Devoir, we think our interests will be best served by direct bargaining. However, we acknowledge that others will want to bargain collectively.
In our industry, there is unfortunately still a lot of misunderstanding about the impact of digital platforms. At Le Devoir, we are uneasy with certain publishers or professors, as respected as they are, when they say that Google and Meta have stolen our advertising revenue and our content. That amounts to ignoring the fact that we voluntarily allow our content to circulate on those platforms. Yes, the business models broke down because of the actions of Google and Meta, but they did not steal anything. We are in an environment of technological innovation without a legislative framework in the world because of a very liberal vision of net neutrality, in which the audience can be segmented on a planet-wide scale. In this situation, those companies are competitors that we cannot compete against.
Media that rely on subscriptions, like Le Devoir, cannot disregard the impact of Google and Meta. Those companies make it possible for readers to discover our content. They enable us to expand our base of users and potentially convert them to subscribers. We are in a complex relationship, a relationship of independence and complementarity, that we unfortunately do not talk about enough, as publishers.
With that said, we cannot fail to mention the imbalance that characterizes the relationship between media and the digital platforms. In fact, it is because of that imbalance and the concentration of advertising revenue in the hands of a duopoly that we need Bill C‑18.