Evidence of meeting #52 for Canadian Heritage in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was journalism.
A recording is available from Parliament.
2:15 p.m.
Canada Research Chair in Internet and E-Commerce Law, Faculty of Law, University of Ottawa, As an Individual
I will, Chair.
What a fund would do is create an open, transparent system in which we would see who the beneficiary is and, specifically, what kind of journalism is being funded.
2:15 p.m.
Liberal
The Chair Liberal Hedy Fry
Thank you very much.
I now go to the Liberal member, who is Ms. Julie Dzerowicz, for five minutes.
2:15 p.m.
Liberal
Julie Dzerowicz Liberal Davenport, ON
Thank you so much, Madam Chair.
It's such a pleasure for me to be at committee today.
I want to thank all the witnesses, as well, for being here today. It's very important for us to hear your testimony.
Ms. Saras-Voutsinas, thanks so much for being here. We haven't seen you since the finance committee. Thanks for all your unbelievable work.
Professor Geist and Professor Owen, I read both of your work. Everything that you guys write, I read. It's very thoughtful.
Professor Owen, I will start with you and continue the conversation that we just finished. In the past, I believe you've argued for and supported a fund model. I know many others have. If I heard your comments correctly, you have now evolved to supporting the bargaining framework.
Could you talk a bit more about why the bargaining framework is a more appropriate policy?
2:20 p.m.
Beaverbrook Chair in Media, Ethics and Communication, Associate Professor, and Director of the Centre for Media, Technology and Democracy, McGill University, As an Individual
I'm not sure I'd go so far as to say it's more appropriate. At this moment, it's more feasible legally, practically and politically.
I agree with Professor Geist that there's an elegance to a fund model. I agree with a lot of things that he's argued about it. Many other academics have promoted it, as well, in other jurisdictions. I see a couple of challenges with it, though, in implementing it.
There are two ways you can put money into a fund. You could create a dedicated tax on platforms. I have learned—I'm not a lawyer—that it could be very complicated legally to do a dedicated tax on a subset of companies in terms of existing trade agreements. If that's not possible, then it has to come from general revenue. If you build a fund coming from general revenue, then someone, somewhere in the government—like we did with the labour tax subsidy—needs to decide what money to put in and what the criteria for that money being given will be.
In my view, both of those things have a far more intrusive government role in the journalism sector than the fund. They're both far more intrusive. Given the context in which we're having the debate about this bill in particular, which I think is far less intrusive, I find it very unlikely that many of the people who are arguing for a fund and have been arguing for a fund through this debate would support that greater involvement of government in the journalism sector.
For those two reasons, I think it is fundamentally difficult.
That being said, I thought that jurisdictions were going to try it in all likelihood. There are models for this potentially being implemented internationally as a global type of fund for global journalism. That's interesting. I think that, as was mentioned earlier, it could be an additive thing so that for some—potentially for local journalism organizations—that model could be applied in other ways. I don't think they are mutually exclusive, necessarily.
Right now, it's incredibly difficult to imagine that fund being stood up in a meaningful way in Canada.
2:20 p.m.
Liberal
Julie Dzerowicz Liberal Davenport, ON
Thanks so much, Professor. I wanted to make sure we heard your full response, because I think it was important for us to get all the details. I appreciate your going into depth on that.
You were talking a little bit earlier about how there are currently financial agreements between certain platforms and news publishers, and they're not transparent at all.
When I was doing a little bit of research, a little bit of reading up before I came to the committee today, I was noticing how some previous witnesses were highlighting that there was a bit of doublespeak when it came to this. I think there are certain times when you have your online platforms talking about the financial agreements they've made behind closed doors with news publishers. They call those commercial licensing agreements, but when they are being mandated by law, as we are proposing through Bill C-18, they're calling it a link tax.
What are your thoughts on this?
2:20 p.m.
Beaverbrook Chair in Media, Ethics and Communication, Associate Professor, and Director of the Centre for Media, Technology and Democracy, McGill University, As an Individual
What I'm most concerned about is that there are large amounts of money flowing from platforms to publishers in the Canadian media market under terms that are unknown to the public and unaccountable to government. In a market that is essential, in my view, for the functioning of a democratic society, the terms of those deals and that funding model need to be as accountable as possible. Does that mean they could be entirely transparent? Probably not, and I think there are legitimate reasons that they can't be entirely opened up. I do think the terms of those deals—
2:20 p.m.
Beaverbrook Chair in Media, Ethics and Communication, Associate Professor, and Director of the Centre for Media, Technology and Democracy, McGill University, As an Individual
—can be accountable to the public via reporting, can be given to an arbitrator so that deals are distributed more equitably and more fairly, and can be provided in an aggregate way to publishers as they enter into these negotiations so everybody gets a similar, fair deal.
2:25 p.m.
Liberal
The Chair Liberal Hedy Fry
Thank you very much. That time is up, Julie.
I'm going to go to a third round, but I just want to warn everyone that we can finish a third round if everyone is concise in their questions and their answers. I don't know if the clerk can tell me if we have a hard stop at three o'clock. I know that a lot of people have other things going on after three o'clock, so we do have a hard stop.
I'm going to begin the third round. I will go to the Conservatives and John Nater.
Welcome back, John. It's so nice to have you with us again. You can begin. You have five minutes, please.
November 4th, 2022 / 2:25 p.m.
Conservative
John Nater Conservative Perth—Wellington, ON
Thank you, Madam Chair. It is wonderful to be back with the heritage committee this week.
I want to begin by echoing the opening comments of my Conservative colleague Kevin Waugh. Certainly, I think Kevin hit the nail on the head in terms of where we stand on this piece of legislation and our overall support for journalism and news media.
I just might add, since we have Mr. Kitt here from Unifor, that brother Kevin is a 39-year member of Unifor, certainly a long-time participant in the industry. It's really nice to have Kevin's expertise on this committee.
I want to start with Professor Geist. I will also give Professor Owen an opportunity to respond to my first question as well. It's about the idea of innovation within the news media industry. Certainly we've seen, particularly in the last few years, new, different and innovative models in terms of how Canadians receive the news and how different providers provide the news.
I'm curious to hear from both of you—I'll start with Professor Geist—about your thoughts on where innovation fits into Bill C-18 and how that may play a role in terms of new entrants into the news media and journalistic market.
I'll start with you, Professor Geist, and then I'll give Professor Owen a chance to respond as well.
2:25 p.m.
Canada Research Chair in Internet and E-Commerce Law, Faculty of Law, University of Ottawa, As an Individual
I think we have seen a huge amount of innovation in this sector. I've run a regular podcast. I've had some of the entities that are servicing local communities engaged in this. Ms. Hepfner mentioned the local journalism project that April Lindgren is involved with. Through that project, she has identified hundreds of new start-ups that have occurred during the same period of time.
Frankly, I think it's unfortunate to belittle it as being just mom-and-pop shops for one and two people. In many instances, I think, these will be the future of servicing some of these communities. In fact, there are communities where it is one of the lead sources.
Some of those start-ups have said that this is not the approach they would like to see happen, in fact. They worry about the prospect of seeing news sharing curtailed. They see some of those large platforms more in the context of being partners as opposed to being adversarial. I do think that the innovation piece is important, so I worry when we see eligibility criteria that may exclude many of those kinds of innovative start-ups. I worry when we take a look at the PBO's estimates that almost all the money is going to well-established players.
At the end of the day, if we want to see that next generation of innovation, it's not just about supporting some of the legacy players, some of which may have struggled to adapt to this environment, but it's about those that have embraced it and are finding new ways to deliver. I think there's a lot of exciting stuff that is taking place. I worry about legislation that purports to level the playing field, but in fact does anything but.
2:25 p.m.
Conservative
2:25 p.m.
Beaverbrook Chair in Media, Ethics and Communication, Associate Professor, and Director of the Centre for Media, Technology and Democracy, McGill University, As an Individual
Thanks for the chance to jump in here.
I couldn't agree more that the future of Canadian journalism is going to come from the network of small journalism organizations and journalist start-ups that are innovating the model of news. There's absolutely no doubt about that in my mind.
That being said, the idea that we should be pitting and positioning small publishers and independent publishers against the large publishers as if they have fundamentally different objectives, values and financial interests is, to me, a disappointing side effect of the implication of the debate we've been having about Bill C-18. I think we have to move beyond that.
Are there legitimate concerns that small publishers and independent publishers have raised about this bill? Of course.
I think that lowering the eligibility criteria to include owner-proprietors makes a ton of sense. The allocation of money is also a bit tricky because at the moment, if you have a baseline fair allocation that's prorated by FTE or prorated by the amount of journalism that's being done, the bigger players are going to get more. Now, is that 75% or 60%? I don't know the exact way that was measured and what we're including in that in the PBO estimate. However, of course, the big publishers, if they have a lot more journalists, are going to get a greater percentage of the money. Does that mean that getting a significant subsidy for a one-person or two-person operation isn't a meaningful contribution to that small operation, one that potentially allows them to innovate and continue to grow? I don't think those two things are mutually exclusive.
The final thing that's really important to note is that, right now, the status quo is important because, of those independent publishers, only a small fraction are getting deals right now. I think this scenario, particularly with the collective bargaining provisions and the provisions that allow for people to be added to collective agreements after the fact, would include a much wider range of small organizations, if not anybody who wanted it, just like QCJO does.
2:30 p.m.
Liberal
The Chair Liberal Hedy Fry
Thank you very much.
Now I would like to go to the Liberals and Anthony Housefather.
Anthony, you have five minutes, please.
2:30 p.m.
Liberal
Anthony Housefather Liberal Mount Royal, QC
Thank you, Madam Chair.
My first question is going to be for Dr. Geist and Professor Owen.
I'm a lawyer, and our amendments are due November 10. I am actually interested in the baseball arbitration part of this, both because I like baseball and because I think it's an important part of the equation.
Dr. Geist, you have written this, and I'm going to quote you so that I get it right:
Yet Section 39 gives the arbitration panel the right to reject an offer on several policy grounds. Why would such a provision be necessary in a final arbitration system that encourages submitting your best offer? It is only necessary if you fear one side will examine the evidence and proffer a low offer on the grounds that it does not believe that there has a been a demonstration of compensable value.
I would agree with you, certainly, if this was a baseball-type arbitration where you were throwing out a salary number and the entire proposal was a salary number. However, the way I read clause 39—and this is where I want your take in terms of wording—it says this, and I'll just stick with (a) and (b):
(1) An arbitration panel must dismiss any offer that, in its opinion,
(a) allows a party to exercise undue influence over the amount of compensation to be paid or received;
(b) is not in the public interest because the offer would be highly likely to result in serious detriment to the provision of news content to persons in Canada;
Based on how Facebook came here last week, let's say, for example, that Facebook provided a number that is a high number and said, “However, as part of that high number, you are not allowed to write articles that are critical of Facebook, and you have to publish glowing testimony about Mark Zuckerberg three times a month.” To me, that is the reason you have clause 39. It's taking things that are extraneous to the actual offer, that certainly are not in the news media's best interests, and it definitely could allow Facebook to exercise influence over the other party.
So, can I come back to you and ask you this? Based on that type of approach, wouldn't this then be a reasonable thing to have there if it was limited to things like that?
2:30 p.m.
Canada Research Chair in Internet and E-Commerce Law, Faculty of Law, University of Ottawa, As an Individual
Thanks. That's a great question.
I'll say a couple of things.
First, there is a (c), which talks about fairness in the marketplace, and it's “or”, so it's any of those criteria that apply. I think even more than that, if we are saying that we trust in the CRTC and then, by extension, trust in the arbitration panel that gets established, if their lowball offer was not just a lowball offer in terms of the financial compensation but lowball in the sense that they attached all kinds of what we might see as unacceptable conditions, as opposed to an offer on the other side that was seen as fairer and that doesn't have that, well, then, it seems to me to be a slam dunk. The panel will take a look at that, reject the Facebook offer and say, “We're going to take that other one.” That's the whole point of this system and that ability to intervene.
Where I have a concern where this comes up is that I think the parties could look at this and say, “We don't see the value of links. If anything, we see the value of links going the other direction, so here's our offer.” It's viewed as low, and it doesn't achieve the broader objectives that I know the government has for this legislation.
2:30 p.m.
Liberal
Anthony Housefather Liberal Mount Royal, QC
I'm going to come to you next, Professor Owen.
Just coming back, your opinion would be that clause 38 in itself is sufficient for the panel to make a decision related to such a crazy.... Let's say it's a higher offer. Let's say it's not a lowball offer; let's say it's a very high offer. They are going to want to pay off the whole news media to write glowing things about them.
You would say that it is still enough under clause 38 and that clause 39 should not be there because clause 38 is sufficient. That's your position.
2:30 p.m.
Canada Research Chair in Internet and E-Commerce Law, Faculty of Law, University of Ottawa, As an Individual
Yes. Listen, as you know, I have issues with the legislation, but I think you could remove clause 39 and remain true to the final arbitration process.
2:30 p.m.
Liberal
2:35 p.m.
Beaverbrook Chair in Media, Ethics and Communication, Associate Professor, and Director of the Centre for Media, Technology and Democracy, McGill University, As an Individual
I don't disagree with any of that. My broader belief is that the arbitration process should be maximally inclusive of the terms of deals that the publishers and platforms come to.
2:35 p.m.
Liberal
Anthony Housefather Liberal Mount Royal, QC
Madam Chair, Mr. Morrice wants to ask a brief question. If I have 30 seconds, I'm going to give that to him.
2:35 p.m.
Liberal
The Chair Liberal Hedy Fry
Yes, okay.
Mr. Morrice, be quick because your 30 seconds are winding down.
2:35 p.m.
Green
Mike Morrice Green Kitchener Centre, ON
Thank you, Mr. Housefather.
Thank you, Chair.
I have a question for Dr. Geist or Dr. Owen.
In terms of the less than 25% that the PBO is saying is going to smaller newspapers, do you have a suggested amendment that would help to address that?