Google agrees to pay £58 million annually to Canadian news outlets

In a resolution to avert a news blockade, Google has struck a deal with Canada regarding the contentious Online News Act, designed to compel tech giants to remunerate news content. The agreement, following months of negotiations, mandates Google to pay C$100m (£58m, $74m) annually, adjusted for inflation, to various news outlets.

The Online News Act, set to be enacted on December 19, triggered Google’s initial vow to remove news links in Canada, mirroring Meta’s response, which has already blocked news on its platforms in compliance with the legislation. The law specifically targets major tech players, Google and Meta (owners of Facebook and Instagram), requiring them to engage in negotiations for payment agreements with news entities.

Canadian Heritage Minister Pascale St-Onge announced the agreement, emphasising that the funds from Google would benefit a diverse range of news businesses, including independent outlets and those representing Indigenous and official-language minority communities. The payment structure involves a “single collective” distributing funds based on the number of full-time equivalent journalists engaged by eligible news agencies.

St-Onge stressed the importance of fostering a sustainable news ecosystem for the well-being of the Canadian news industry, citing the risk posed by newsroom closures and layoffs. Google, in response, expressed its satisfaction with the Canadian government’s commitment to addressing concerns raised by the bill, pledging to work through the exemption process while continuing to direct valuable traffic to Canadian publishers.

Canada’s Online News Act drew both criticism and support when passed, with tech companies denouncing it as “unworkable,” while media groups hailed it as a stride towards market fairness. The final compensation figure of C$100 million resulted from extensive negotiations, marking a significant development in the ongoing global dialogue around the intersection of tech platforms and news content, reminiscent of Australia’s legislative actions in 2021.