Struggling Canadian News Agencies Ask Government For A 'Google Tax'

from the loads-gun,-points-at-foot dept

It never fails (although the proposed solution often does): when faced with the struggles of operating news organizations in the internet era, far too many industry leaders suggest someone else should pay for their failing business models.

The favorite target is Google. Google has somehow destroyed the profitability of news media companies by creating an incredibly successful search engine. Even though its search engine directs users to news agencies' websites, there are those in the industry that believe incoming traffic isn't enough to offset their perception that the search engine somehow piggybacks off their success, rather than the other way around.

So-called "Google taxes" have been passed into law in countries around the world. In every case, they've been a disaster. In Spain, new agencies begged to have the law rolled back after losing traffic from Google searches. Having seen what didn't work in Spain, Austrian lawmakers floated the same idea, proposing a tax on SINGLE WORDS in search results. The latest bad idea is an EU-wide "snippet tax," because it worked so well in Spain, Spanish newspapers begged the EU to step in and block Google from killing its news article search results in Spain in response to the proposed tax.

With all of this data to go on, you'd think the idea would be dead. But it isn't. The EU wants to spread its stupidity across several countries. Meanwhile in Canada, a meeting of minds over the fate of Canadian media companies has culminated in the same exact aneurysm.

Tax changes, better copyright protection and fees imposed on Facebook and Google are among the solutions being touted to help rescue Canada's ailing news industry, internal reports show.

Those suggestions were prominent in closed-door sessions with news leaders conducted by the Public Policy Forum, a think-tank the federal government has hired to suggest policies in support of Canadian journalism during a period of digital disruption and reporter layoffs.

So, there's also a "Facebook tax" proposal, one that originates from the country's ongoing efforts to support local creations and content. Those pushing a form of Google tax are suggesting this would be no different than the government's levying of fees on cable companies whose programming didn't contain enough Canadian-made content.

"Perhaps this could be [a] concept … applied in the digital space, establishing charges on news aggregators and foreign content producers such as Facebook, Google, Netflix and National Newswatch to subsidize made-in-Canada content."

Perhaps. It's definitely a "concept" and one that could be "applied" to digital space… but only if the Canadian government wishes to see foreign content producers pull out of the Canadian market. (And, as the CBC notes, the think tank quoted doesn't appear to know that National Newswatch is actually a Canadian media company. That kind of "thinking" is going to get in the way of itself if these are the minds crafting new media policies.)

And there's really no explanation for this:

"Canadian policy-makers should consider whether copyright laws that govern file-sharing in the music industry could be applied in the news industry," with some arguing for a 24-hour period of exclusivity.

Exclusivity is impossible to guarantee on the internet, so unless the legislature is willing to criminalize this form of… I don't know, infringement(?), then there's little that can be done to guarantee 24 hours of exclusivity to any media company. Not only that, but the web is world-wide, and Canadians are free to bring their eyeballs and clicks to foreign sites not subject to any ridiculous 24-hour exclusivity "rights."

As for the file-sharing, I don't even know where to start. Are newspapers going to sue readers for sharing paywalled content or posting links to Facebook? Is unauthorized consumption of news the new piracy?

Better suggestions are made elsewhere in the report, although these still rely on taxing others to prop up struggling industries.

Change tax rules to allow philanthropic support of journalism by charitable or non-profit foundations. "Under existing rules, it becomes difficult to establish the type of independent, non-profit news model that has proven so successful in the United States through ProPublica," says the interim report.

Create tax incentives and exemptions to encourage coverage of local news. Investors, for example, could get special tax credits for putting money into local, non-profit digital news startups.

Review the role of the government-financed CBC, which has moved into digital news space and — according to some publishers — has undermined the private sector's abilities to attract ad dollars. (The CBC has since proposed that it abandon all advertising, relying solely on increased public funding.)

In every case, there's a look to Canadian citizens' pocketbooks to subsidize media entities that, for whatever reason, Canadians haven't felt like supporting directly.

This is still in its discussion phase, but the summary report points to a lot of bad ideas bubbling to the top. If Canada wants to turn news media into government-subsidized industries, it's going to do at least as much damage to the quality of reporting as their current financial struggles. Any perception of indebtedness to the government will work against these agencies, undermining their reporting and creating doubts of impartiality in the minds of their readers.

As for the various taxes of US companies to subsidize falling Canadian newspapers sales, hopefully a longer look at the proposals will reveal the unintended negative consequences of these plans before both Canadians and Canadian media companies pay the belated price for their short-term thinking.


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  • identicon
    I.T. Guy, 20 Jan 2017 @ 8:43am

    Tax changes, better copyright protection and fees imposed on Facebook and Google are among the solutions being touted to help rescue Canada's ailing news industry, internal reports show.
    No mention of how to provide a better service or builda community. It's all gimme gimme gimme.

    Those suggestions were prominent in closed-door sessions with news leaders conducted by the Public Policy Forum, a think-tank the federal government has hired to suggest policies in support of Canadian journalism during a period of digital disruption and reporter layoffs.

    Anyone find it absurd that something called the Public Policy Forum holds meetings in private away from the public?

    reply to this | link to this | view in chronology ]

    • identicon
      TripMN, 20 Jan 2017 @ 11:45am

      Re:

      They are writing policy for the Public to follow, not for the benefit of the public. Silly I. T. Guy thinking they'd show their cards by using a public forum before they have the rules to tie the hands of the public nearly set in stone.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 20 Jan 2017 @ 8:45am

    The syt

    "Canadian policy-makers should consider whether copyright laws that govern file-sharing in the music industry could be applied in the news industry,"

    reply to this | link to this | view in chronology ]

  • identicon
    Man of very fat fingers, 20 Jan 2017 @ 8:47am

    The stupid it burns!

    "Canadian policy-makers should consider whether copyright laws that govern file-sharing in the music industry could be applied in the news industry,"

    Like say the tax we pay on all media, hard drives, CDs/DVDs, Ipods etc that was supposed to be compensation for piracy?

    Right I forgot we have put the 90's down the memory hole

    reply to this | link to this | view in chronology ]

  • icon
    Berenerd (profile), 20 Jan 2017 @ 8:48am

    I would ALMOST be ok with this in the US...

    BUT, to get any money from this TAX they would have to prove that their articles are backed up by facts and failing that are unbiased. 90% of the tax would go to paying 3rd parties doing fact checking. This tax would not be paid for by tax payers but by ISPs and any service that shares the articles. If the Article is found to be lacking of real facts, then the Media company will not get any money and will have to pay a fine each time equal to the tax charged to ISPs for at least a year for every offense. They would also have to not sue companies like google for linking their articles. Also, any Linking page owner who pays the tax, those who follow the link can not be stopped by paywalls.

    reply to this | link to this | view in chronology ]

  • identicon
    angry bird, 20 Jan 2017 @ 9:03am

    NO

    first they wanted a netflix tax when i dont use netflix to help hollystupid ( ILL SUE FOR THIS TRUST ME)

    now they want a google tax cause someone has the brains to go findout news for themselves....and all the fake biased crap they ( NEWS AGENCIES) deliver.

    NO NO NO.

    I ALSO can write up a spider and have a search engine to spider various stuff i wish.....YOU GONNA force people i let use this to get taxed on that? NO REALLY ? When you look at any news/entertainment now adays they all look like utter nutbars....

    GET A REAL LIFE AND JOB OR GET OUT OF THE WAY

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 20 Jan 2017 @ 9:11am

    Unlike the entire EU, it would be quite a bit easier for FB/Google to simply pull out of Canada completely (like it did Spain) and let the Canadian companies stew in their own juices. Canada is the US's no 1 trading partner, but that's for all physical goods crossing our mutual border. In terms of absolute eyes on content, Canada has barely 10% of the US's population and likely a much smaller impact on Google's bottom line.

    I hate invoking South Park, but Canada news media would be well instructed to take the "Canada on strike" episode to heart. What happened to Spain can very easily happen to Canada.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 20 Jan 2017 @ 9:15am

    The newspapers are not loosing audience because their content is indexed by Google, but because they are competing badly with people on social media and bloggers. The ubiquitous phone camera allows anybody, and indeed often many people to do live reporting of events, and bloggers do deeper analysis better than the newspapers.

    reply to this | link to this | view in chronology ]

  • icon
    Ninja (profile), 20 Jan 2017 @ 9:16am

    Are they trying new approaches such as having readers curate journalists or subjects? Have they tried the old connect with fans and giver them a reason to throw their money to them? Among other ideas.

    Nop, instead most are driving any community they have away by killing comment sections and forums. Basically they still think journalism is a 1-way business where they are the gatekeepers and the public just listens bestialized.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 20 Jan 2017 @ 9:52am

      Re:

      To be fair, unless you're a national organization with a HUGE readership, having one's own comments section is more trouble than it's worth. A lot of news organizations jumped on that bandwagon only to find out that curating and modding comments sections doesn't make sense from neither the business nor engagement standpoint as the number of commenters versus readers (or spammers and trolls), is small.

      Building "community" doesn't necessarily build revenue as you see repeated time and time again in community built websites struggle to turn community into sustainable revenue just to pay the bills let alone make a profit.

      I don't know what the answer is, and I doubt anyone else really knows at this point either. I imagine it's going to end up a closely curated hybrid of pay-walls & ads, but I don't know for sure.

      I would actually subscribe to a news organization that carefully curated its articles for well written, factual information regardless of its immediacy. I don't need it right NOW. I don't want or need click bait. What I want is just plain right. Give me Walter Cronkite or Ed Morrow for the Internet age.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 20 Jan 2017 @ 9:20am

    This isn't quite correct....

    Even though its search engine directs users to news agencies' websites, there are those in the industry that believe incoming traffic isn't enough to offset their perception that the search engine somehow piggybacks off their success, rather than the other way around.

    I get my news from news.google.ca. I rarely go to the actual sites. So yes, Google is intercepting page hits from the Canadian news services (mostly CBC, which is already funded by Canadian taxes).

    The problem is that back in the paper days, in order to get people to read the news, papers would use the following format: "clickbait" title, key information in the first sentence, editorial following, and then text at the end to tie the editorial to the actual content and title.

    As you can see, if Google is scraping the title and first line of the article, they've basically taken everything but the editorial -- and due to time pressures on newspapers, the editorials frankly usually suck. I get better editorials by reading Reddit.

    So the problem here is that newspapers have formatted their online content to fit the ad holes which don't exist online, especially when the leaders are all snipped out of context and fed directly from Google. Nobody wants to go see a page that's 80% ads, the title they've already read, the news they've already read, and then some editor or reporter's impressions of the article; they'd rather just read the leading line and the leading line from reuters and whatever other agencies are reporting.

    So articles that were written originally to get people to look at THIS newspaper instead of those other ones are now grouped together so that people can make an informed decision, article by article, as to what they really want to read, and how much detail is worth digging for.

    In summary, Google both scrapes the actual news from all these sites, AND provides a service that prevents people from having to wade through an entire paper to see if the article they're interested is best served from that site or another one. This means less ad impressions, and less profit.

    It's a shame newspapers went this direction. I personally prefer the small publications that stick to local information and a tasteful number of local ads that are newsworthy in and of themselves. National/global news can be found by aggregating the local news in a search engine. This means that the Google views bring MORE views to the sites instead of less, which is often the case right now where the sites don't actually have much worth reading in the first place.

    reply to this | link to this | view in chronology ]

  • icon
    TheResidentSkeptic (profile), 20 Jan 2017 @ 9:40am

    Sometimes, reality sucks

    In centuries past, the only news came from travelers telling stories - then from ships arriving in ports - then from town criers - then from printed flyers - then from Radio - then from Television - and now from the internet.

    Each of these came into, then fell out of, favor. Each of these came into being when the technology to support them was invented. Each partially or fully supplanted the prior.

    When newspapers were the only source (other than "important highlights" from TV news), they had a captive audience. There was no where else to get that information - and they thrived in that void. The AP and other "global" agencies created a wire-service that all local papers could subscribe to as that was the only way to get international news quickly. Papers relied a LOT on AP articles (and Getty Images) "way back then".

    As all financial investments state "Past Performance is no Guarantee of Future Results". There is nothing to say that your industry MUST continue to exist when newer technology comes along to replace it.

    Business Executives may miss "fishing in the typing pool", but PCs and the technology of Word Processors killed it. The Dial Telephone eliminated operators. "Long distance please, South Carolina, Jefferson 4-5566" (yeah, I'm old enough to remember how I called my Grandmother in the 1950's) Some businesses do "evolve with the times". Fischer Buggies made the transition from Stagecoach to Automobile bodies.

    We need to stop the thoughts of being entitled to exist forever. And we sure as hell don't need laws to protect "the old guard" and we don't need to tax the new to keep the old on life-support forever.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 20 Jan 2017 @ 9:46am

    Newspapers should ask for a Craigslist tax because that's who took all their revenue.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 20 Jan 2017 @ 4:14pm

      Re: Rivers of Gold

      Ads of all shapes & sizes across all spectrums used to be the rivers of gold that kept the presses printing. Now online ads for all goods & services have killed off many newspapers so badly that the newspaper owners have bought out the big online advertising sites that deal with real estate & cars to keep their profits flowing.

      These sites rely on commercial sellers to cough up cash to sell their products. It works OK in real estate with the middlemen in the form of real estate agents or vehicles being sold by new car dealers, even employment sites make money. But when it comes to citizens selling used cars & bits & bob then those ads are missing from (forced)paid ad sites and the newspapers.

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 20 Jan 2017 @ 5:02pm

        Re: Re: Rivers of Gold

        Plus ad-tech keeps ad rates low, even for high quality sites.

        John Gruber pointed to this today. It's Walt Mossberg talking about ads on Recode:

        About a week after our launch, I was seated at a dinner next to a major advertising executive. He complimented me on our new site’s quality and on that of a predecessor site we had created and run, AllThingsD.com. I asked him if that meant he’d be placing ads on our fledgling site. He said yes, he’d do that for a little while. And then, after the cookies he placed on Recode helped him to track our desirable audience around the web, his agency would begin removing the ads and placing them on cheaper sites our readers also happened to visit. In other words, our quality journalism was, to him, nothing more than a lead generator for target-rich readers, and would ultimately benefit sites that might care less about quality.

        reply to this | link to this | view in chronology ]

  • identicon
    stosh, 20 Jan 2017 @ 9:47am

    "to help rescue Canada's ailing news industry"

    Perhaps reporting actual news instead of biased opinion disguised as news would do more to help rescue them...

    reply to this | link to this | view in chronology ]

  • icon
    orbitalinsertion (profile), 20 Jan 2017 @ 10:08am

    Don't let your site be indexed. Don't add share buttons provided by other services. Don't feed your site though accounts on these services. Seems pretty simple...

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 23 Jan 2017 @ 7:31am

      Re:

      Pretty simple to do the whole ROBOT.TXT for your web site and then Google will have nothing to do with you. No Google Index of your site. But that isn't what this is about. They want it all. They want that Google Index, but they also want Google to PAY to do it.

      reply to this | link to this | view in chronology ]

  • icon
    streetlight (profile), 20 Jan 2017 @ 10:11am

    Google can't index news if it's not on the Web

    Maybe I don't get it, but if news providers don't put their information on the Internet, Google can't index it and a search won't find it. Simple: force folks who want their product to pay for it in printed form or direct viewing of its videos. Problem solved. Then again, maybe no one wants to read or view their news output.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 20 Jan 2017 @ 1:26pm

      Re: Google can't index news if it's not on the Web

      More than that, Google respects tools like robots.txt and/or direct requests to not include a news site in news.google.*

      This is classic 'have your cake and eat it two times over'. They want the traffic, AND to get paid for the privilege.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 20 Jan 2017 @ 10:40am

    These countries are following the socialist model

    Tax the successful to redistribute to the less successful. Fortunately Amerika has gotten at least a 4 year reprieve.

    reply to this | link to this | view in chronology ]

    • identicon
      Dougal Turnip, 20 Jan 2017 @ 4:13pm

      So use the Tsilaicos model (pronounced sill ah ee cos)

      Where you tax the less wealthy to redistribute to the more wealthy. Oh wait....

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 21 Jan 2017 @ 8:28am

      Re: These countries are following the socialist model

      "Tax the successful to redistribute to the less successful. Fortunately Amerika has gotten at least a 4 year reprieve."

      Hahahahaha, Bizarro Robin Hood

      reply to this | link to this | view in chronology ]

  • icon
    DB (profile), 20 Jan 2017 @ 10:45am

    It's easy to miss the proposal to offer tax credit or charitable contribution deductions for "donating" to support local news.

    It doesn't take much imagination or foresight to predict the outcome. Wealthy people using this for taxpayer-subsidized PR. Companies doing tax-deductible advertising and lobbying for special advantages. Politicians being even more beholden to corporate-controlled media outlets.

    reply to this | link to this | view in chronology ]

  • icon
    ArkieGuy (profile), 20 Jan 2017 @ 11:10am

    Exclusivity

    Say I'm the first person to tweet about (or whatever is decided to be the minimum requirement for "reporting") a terrorist event... Can I sue the TV station or news paper that runs a later "report" if it's within 24 hours?

    Sounds to me like the media stands to lose more than they gain in a citizen reporter time in history.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 20 Jan 2017 @ 4:35pm

      Re: Exclusivity

      Nope, the rules will be written so that only "officially recognized journalists" will be afforded the 24 hour protection, and of course they will get to decide who is and is not a journalist...

      reply to this | link to this | view in chronology ]

  • icon
    David (profile), 20 Jan 2017 @ 1:19pm

    How are newspapers profitable?

    Somehow I doubt if the actual profit for the newspapers are centered on news articles.

    Maybe they should take Business 101 again, or finally. Taxing others to ensure Canadians can continue is their tradition, as I recall they still charge different prices for CD/DVD for data or entertainment. Is that still a thing?

    reply to this | link to this | view in chronology ]

  • identicon
    Andy, 20 Jan 2017 @ 5:25pm

    The problem and the only problem!

    The media had competition and they do not know how to deal with it. They have always been a protected monopoly worth multiples of millions or even billions but now see that anyone can start a blog and report the same content with the same sources most of the time.

    One of there problems is that they are not investigating stories and producing content that is not available anywhere else and even if they do it is not illegal for anyone to report the facts even if a newspaper sourced the facts.

    newspapers need to find what attracts people, for me it s a very easily read website with video and photos that i can play if i want not forced on me, I do not mind advertising as long as it is not the flashing ads or popups or ads that they try to pass of as news.

    reply to this | link to this | view in chronology ]

  • identicon
    fat finger man, 20 Jan 2017 @ 7:16pm

    To much attributed to the web

    Places like google and facebork which both have massive state support have distorted expectations, look up barbecue dot com from dot com 1.0 200million in I don't know that they ever sold a single barbecue, went bust less than a year after launch, even successful site like fark that has(wild stab in the dark) 20k paid subscribers? employee's? what like 4 mods are all volunteer, you can make a living for you and yours but the idea that you will be zuck without state support is madness, web 2.0 is welfare for rich people

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 20 Jan 2017 @ 8:41pm

    Well Google can tell Canada the same thing they have told others.

    Goodbye.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 20 Jan 2017 @ 9:07pm

      Re:

      Yes, and then we can watch the same backpedaling ensue.

      "You need to either pay us more money or take your monopoly on news and get out, because we can't do business."
      "Okay, we'll leave."
      "Wait! You can't do that! We won't be able to do business!"

      reply to this | link to this | view in chronology ]

  • icon
    Richard (profile), 21 Jan 2017 @ 1:59pm

    Who but Canadians (if even they) will notice?

    I used to get paid scads to develop SEO strategies and tactics to cajole Google to list sites on page one above the fold. Avoid the court cases, and just let these greedy, ignorant whiners die in their own filth.

    reply to this | link to this | view in chronology ]

  • identicon
    Daydream, 22 Jan 2017 @ 2:10am

    You know, part of the idea behind basic income is to reward people who are contributing to society but not receiving salaries/commissions for it.

    Perhaps instead of demanding money from Google, these news companies should be paying money TO Google instead.

    After all, they're getting search results for free and traffic directed to their site for free, aren't they?

    reply to this | link to this | view in chronology ]

    • identicon
      Wendy Cockcroft, 23 Jan 2017 @ 2:30am

      Re: You know, part of the idea behind basic income is to reward people who are contributing to society but not receiving salaries/commissions for it.

      As a matter of fact the smart thing to do would be to buy shares in Google. That way they could share in the profits it makes. It's probably cheaper than trying to buy politicians.

      reply to this | link to this | view in chronology ]


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