Despite some relief measures, the agony of Canada’s news outlets continues. Much more needs to be done to turn the tide.
by Marie-Ève Martel. Originally published on Policy Options
February 20, 2024
(Version française disponible ici)
The more things change, the more they stay the same, as the saying goes.
Five years ago, I was among those who sounded the alarm about news outlets closing in Canada. At the time, some 260 titles – most of them print weeklies – had disappeared from the Canadian media ecosystem – an alarming decline harmful to democratic health at the local level.
Unfortunately, despite a momentary spike in advertising investment during the pandemic, the bleeding has not stopped in Canada. According to Canadian Heritage, more than 450 newsrooms have closed in Canada over the past 15 years, 63 of them since the COVID-19 pandemic.
These figures, published in 2022, are already out of date. In the past year alone, many more media workers have lost their jobs, especially in the information business. Bell Canada, for example, cut more than 1,300 jobs across the country in June 2023, before announcing in February this year that a further 4,800 jobs would be eliminated, of which less than 10% involved Bell Media, and 45 regional radio stations sold. Postmedia laid off 11% of its editorial staff. Metroland cut 605 positions by abolishing 71 print editions.
In Quebec, the largest private television network, TVA, laid off almost 800 employees in two separate waves last year. Métro Média, which owned a daily newspaper in Montreal as well as nearly twenty hyperlocal weeklies in the metropolis and Quebec City, ceased operations in the fall. Les Coops de l’information announced 125 voluntary departures. Other buyout programs are taking place across the news industry, but media organizations often stay quiet when they are cutting through early retirement packages and other voluntary departures.
The tally doesn’t include the cuts announced in December at CBC/Radio-Canada, where 800 positions are set to disappear over the next few months. Even the Reader’s Digest Selection, a longstanding publication beloved by Canadians, will disappear in the spring, a sign that nothing lasts forever. For its part, Cogeco has also raised the spectre of newsroom cuts. No corner of the media landscape is being spared.
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Finally, TC Transcontinental’s decision to end its Plublisac flyer distribution service this spring will eliminate a distribution vehicle for dozens of free weeklies in virtually every region of Quebec.
Extending media support
This gloomy summary shows that efforts to save the media industry have not measured up to the crisis. Faced with the extent of the damage, Ottawa and Quebec introduced tax credits a few years ago to support the production of journalistic information. The measures were intended to be temporary, and their renewal – or elimination – is subject to the goodwill of those who will be sitting in legislative assemblies when they expire.
Under the current aid programs, in both jurisdictions only print media benefit. With the crisis extending across radio and television, access to these tax incentives should be extended to all recognized journalistic organizations, regardless of the medium used to transmit information.
The provincial aid should also include news agencies, which are left out of existing measures despite their essential role in the ecosystem.
Further curbing the exodus of advertising revenues
At the same time as it has been vital to support the production of news, governments should have also curbed the outflow of advertising revenues to foreign companies. Yet it was only recently – after years of crisis – that Ottawa finally took the bull by the horns with Bill C-18, an attempt to give a share of advertising revenues captured by the web giants to news organizations.
Online advertising investment in Canada is currently estimated at just under $10 billion. Nearly 80 per cent of this sum is captured by two American platforms, Google and Facebook, who reinvest only crumbs of this imposing slice of the pie into the Canadian media ecosystem.
While Google signed an agreement to redistribute $100 million to news organizations (a far cry from the initial royalty amount sought by Ottawa), Meta preferred sidestep the law by blocking all sharing of Canadian news content and terminating its piecemeal agreements with several media outlets. It should also be noted that some of these beneficiaries preferred to negotiate with the digital giant themselves, rather than have a one-size-fits-all solution imposed on them.
Rather than trying to recover a tiny fraction of the millions of dollars that have already left the country and the Canadian news industry, decision-makers should be looking at measures to reduce the outflow of ad revenue.
In addition to a tax credit for digital news subscriptions, which subsidizes subscriptions to Canadian media, Ottawa offers a tax credit on advertising investments in these same media. Unfortunately, this measure is not well known and needs to be promoted as a tool available for news outlets and advertisers alike. If this initiative was matched by the provinces, millions of dollars would stay in the country and be reinvested here.
However, companies can also deduct the cost of ads purchased from Facebook and Google, as Cogeco president Louis Audet recently pointed out. He called for the federal tax credit to apply only to advertising spending with Canadian media companies.
In Quebec, the mayor of Longueuil is the latest to propose that Canada Post take over the distribution of local weeklies, an option that must be weighed while considering the Crown corporation’s money-losing situation.
A fundamental choice about the nature of our society
Finally, governments should lead by example. The Coalition Avenir Québec’s decision to resume advertising on Meta suggests that the Quebec government seems to have given up in the tug-of-war between Canada and the digital giant.
Rather than capping their advertising investments on these online platforms, governments at all levels should set a minimum threshold to be spent on advertising in Canadian media that reach the citizens they aspire to serve.
Supporting the news media – and Canadian journalism – has become a political, even partisan choice. It should be a matter of consensus, especially since information is now recognized as a public good by many.
There are dissenting voices, even within journalism, when it comes to public support for the news media. Those who oppose government intervention argue that journalists must be able to do their work independently. Public funding, they argue, represents a conflict of interest, real and perceived.
At the same time, nature abhors a vacuum: the disappearance of our media gradually leaves the field open to fake news and misinformation. Many communities have already become news deserts in recent years. Is it better to have journalists assisted by public funds, or no journalists at all?
Investing in our media means better-informed citizens who are more involved in public affairs. It also means choosing to promote our own culture rather than letting it to a free market inevitably dominated by the United States. For Quebec media and those who work in minority communities, it also means supporting an important tool for linguistic promotion.
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This article first appeared on Policy Options and is republished here under a Creative Commons license.