Google said the decision by Canada exposes the company to “uncapped financial liability”.
Google (NASDAQ: GOOGL) is removing all Canada news links from its search due to a new Online News Act. The tech giant said it would block all Canadian news, meaning users will no longer find any report linked to the country on the search engine. The decision was in response to a new law that required tech companies to pay media outlets for content.
Last week, the Canadian government’s controversial C-18 legislation in Canada passed parliament despite Google noting that it was “unworkable”. Meta (NASDAQ: META) also criticized the bill on the grounds that it was unfair to impose compensation on tech companies. Google and Meta have been battling with the government over the law forcing them to pay media outlets in Canada for distributing links to news stories. The Canadian government explained that the legislation is to offer fair compensation to struggling news outlets. The officials also emphasized the need “to enhance fairness in the Canadian digital news market”. The bill supporters wrote:
“Digital platforms and social media are now the gateways where people find, read and share news. Because of this, advertising revenues have shifted away from local news and journalists to these gatekeepers, who profit from the sharing and distribution of Canadian news content.”
There is a prediction that the law could generate up to $329 million for the Canadian news industry. Although the Online News Act has already been passed in Canada, it would take months to take effect. When it does, Google has already decided to remove links to “Canadian news from our Search, News, and Discover products and will no longer be able to operate Google News Showcase in Canada”.
Google Will Block All Canada News Links
In a news blog, Google said the decision by Canada exposes the company to “uncapped financial liability”. It reiterated that it is not the proper approach and could impact its products. According to the tech giant, it contributed to Canadian journalism via programs and partnerships and is willing to do more. Google revealed linking to Canadian news publications over 3.6 billion times last year at no charge. According to the company, it helped publishers generate profits via ads and new subscriptions without expecting anything in return. Despite the willingness to do more, the multinational technology company said it will not be able to do that “in a way that breaks the way that the web and search engines are designed to work, and that creates untenable product and financial uncertainty”.
Canadian minister Pablo Rodriguez was surprised by Google’s decision to remove all Canadian links from its platform. The politician said they still had a conversion with the tech company shortly before. Google also confirmed that it discussed with the government where it requested clarity on financial expectations. Google seemed to be dissatisfied with the chat with Canada officials, as it announced removing the links not long after the meeting.
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