Meta faces backlash for allegedly bullying the Canadian government and news outlets through a news ban.
Meta Faces Potential Revenue Loss as Canadian Government and Media Withhold Advertising
Meta, the social media platform formerly known as Facebook, could suffer significant financial consequences as Canadian government officials and media outlets take a stand against its decision to block links to local news stories. This move has prompted government agencies in Canada to stop purchasing ads from Meta, as well as from Instagram and Google, in protest.
The controversy stems from the passing of the Online News Act in Canada, which mandates that social platforms compensate news outlets for distributing their content. In response, Meta implemented a ban on sharing links to Canadian news outlets within the country.
Ad Boycott Threatens Meta’s Bottom Line
“The sudden movement by advertisers, including the federal, Quebec, British Columbia governments, as well as some leading Canadian businesses, to pull advertising from Meta could well cost the company more than they would have to pay publishers under the Online News Act,” said Paul Deegan, CEO of News Media Canada, a trade association for Canadian newspapers.
The Canadian Association of Broadcasters President, Kevin Desjardins, expressed concerns about the impact of foreign web giants on the Canadian economy. He called on both Google and Meta to act responsibly and stop allowing misinformation and disinformation to thrive by impeding access to high-quality journalism.
Canadian Heritage Minister Pablo Rodriguez criticized Meta’s approach, describing it as a “bully approach” that disregards Canada’s sovereignty. He emphasized the need for these tech giants to contribute their fair share and not dictate terms to the country.
Estimated Financial Consequences
Rodriguez estimated that Meta’s decision to block links to Canadian news outlets would result in an annual loss of $7.54 million for the company.
While Google initially supported Meta’s ban on news links, it eventually entered into negotiations with the Canadian government to find a resolution, as confirmed by Rodriguez.
Congress is also considering a similar bill, the Journalism Competition and Preservation Act, which has passed through committee and awaits consideration by the Senate. However, resistance is expected in the House, with Speaker of the House Kevin McCarthy (R-CA) indicating that the bill would not progress.
It is worth noting that Meta previously imposed a ban on sharing and viewing news stories in Australia when the country introduced a law requiring the company to pay news outlets for their content. However, international pressure led to the ban being reversed within days.
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