Thank you very much for the invitation to this committee.
My name is Ben Scott. I'm the director of Reset. We are an international non-profit organization that works with governments to help realign the incentives of the technology industry back to support the values of democracy.
I can give you a comparative perspective of how these issues and bills like Bill C-18 are being considered all around the world. Though I'm currently based in England, I lived for years in Canada and have a great deal of familiarity with the Canadian market.
What I can tell you is that lots of folks around the world see the same problems you do—journalism in crisis, as you've heard from colleagues on this panel; market power in the digital advertising industry held by a handful of titans—and an opportunity to intervene to make sure that journalism continues to flow to the public. What you have in Bill C-18 is among the best bills I have seen of its type.
The point I want to begin with today is a simple but fundamental one, and as the only non-industry representative on this panel, I feel I have a duty to make it. This legislation must not be about publishers; it must be about the public. Too much of this debate plays out as if government were simply refereeing a contest between big tech and big publishers. That's wrong. What justifies this market regulation is the public interest in making sure that quality journalism is delivered to the people. Like you, other governments are looking at this problem and trying to make sure that they address the market failures in the right way, because these aren't just failures among industries; this has hastened the destruction of public service journalism in ways that really undermine democratic integrity.
This committee knows well the stats in Canada: $5 billion out the door in terms of news industry revenues, 450 news outlets closed over the course of the last 15 years, a third of Canadian journalism jobs gone. That's a crisis. There are many factors causing that crisis, but one of the more obvious ones is the market power over digital advertising held by two companies.
I'll refer you to some analysis done by the British Competition and Markets Authority, which breaks down the digital ad market into services provided to publishers, services provided to advertisers and the exchanges in between. Google has, according to the CMA, a 90% market share in the first two of those segments, and a 50% market share in the exchange. That's market power by any reasonable definition, and that's the reason why so much revenue is flowing away from news organizations. But we're only intervening here on behalf of the news organizations because they provide a public good called journalism, which the people need. There's nothing in here about a link tax; there's nothing in here that's going to break the Internet. This is about restoring fairness in the marketplace so it provides a critical public service.
So far, what I see is that Canada is doing as well as or better than other countries at keeping the public at the centre of this conversation. I want to make three points that I think are essential for making sure this bill delivers for the Canadian people.
The first one is that Bill C-18 has to prioritize fairness and inclusivity. It has to offer deals that are equitable and on similar and reasonable terms for small publishers and large publishers alike.
Second, we have to insist on the fact that any new revenue that comes in—it might be up to 30% of revenue, and that's a big number, as you've heard—has to go towards journalism production, not towards buybacks or debt load. It has to go towards the production of news. That's the reason why this legislation matters.