Thank you, Mr. Chair and members of the committee, for giving me the opportunity to appear before you today on the subject of this important bill.
The Canadian Association of Broadcasters, the CAB, is the national voice of Canada's private broadcasters. It represents over 700 members across Canada, including a large majority of private radio and television stations, as well as specialized services.
Canada's private broadcasters welcome the introduction of the online news act as an important step towards recognizing the value of broadcasters' news content and providing the necessary framework for fair negotiation between news organizations and online platforms.
Maintaining professional newsrooms in communities across the country is a fundamental commitment of Canada's broadcasters. Last year, Canadian broadcasters invested $681 million in news and community information programming.
Unfortunately, broadcast news is a very challenging enterprise. It has depended largely on entertainment programming that draws the largest audiences and the greatest ad revenues. Over the past decade, foreign online platforms have moved aggressively to corner the markets in search advertising. Using their dominant positions, they have dramatically impacted the advertising market through the algorithmic exploitation of user data. Now foreign digital platforms take more than half of those ad revenues out of Canada's economy. They are offshored to entities with little connection to Canadians' values or public interest, and they profoundly undermine Canadian news organizations' ability to support and maintain a robust news-gathering infrastructure. At the same time, these entities are exploiting Canadian news organizations' online content to deepen their competitive advantages in advertising.
Search and social platforms may help to direct audiences to online news sites, but they are not doing this out of the goodness of their heart. In reality, they are retaining most of the value from those user interactions with news sites through their ability to gather, aggregate, resell and exploit user data to advertisers through their algorithms. Nevertheless, social and search platforms provide no compensation to news sites for the value they derive from those interactions.
Today, Canadian news organizations have no realistic option but to agree to the platforms' terms, given their dominant positions online and lack of regulatory oversight. As news broadcasters and publishers struggle to maintain the resources necessary to continue to inform Canadians, it is critical that a policy framework be developed to help recognize the value of their online content. This framework should recognize Canadian news organizations' unique contributions to the public good and the value that is extracted from them by dominant digital platforms. This is why Bill C-18 is so necessary.
We believe that Bill C-18 strikes the right balance. It would enact a fair and reasonable negotiation framework for Canadian news organizations and large global digital platforms, and it would provide an arbitrated backstop should those negotiations not be concluded constructively.
We know such a framework can work. As Professor Rod Sims said earlier to this committee, “Australia's code has been extremely successful in achieving its objective.” More specifically, the Australian code has helped to address the power imbalance I referred to earlier and has compelled the platforms to negotiate in good faith. It has helped news organizations of all sizes to maintain and grow their newsroom staffing.
Bill C-18 would not create a “link tax”; nor would it incentivize clickbait. It would not break the Internet, as it has not in Australia. The incentives that are built into the bill clearly focus on sustaining journalism jobs in Canadian newsrooms. Moreover, because a government agency is involved only as a backstop to resolve disputes when no agreement between the parties has been reached, the proposed legislation poses no concerns to press freedom or free speech.
Ensuring the viability of our newsrooms is critical to Canada's democracy. It is particularly essential as Canadians are increasingly confronted with misinformation and disinformation online. We know that when Canadians turn to online news, the most popular sources are sites associated with Canadian broadcasters. The content that is ultimately of most use to citizens and to the continued value of our democracy is developed through trusted news organizations, including television and radio broadcasters.
We do have a certain amendment with regard to clause 51, which is essentially just to strengthen this section and to make sure it does what it was intended to do.
Canada's broadcasters want to continue to be a dependable source for local, national and international news for Canadians, but to do so we require a fair opportunity to be compensated for the value of our news content.