The Online News Act may be only days removed from having received royal assent, but the government’s plans to support the Canadian media sector have already backfired spectacularly. While it claimed its Bill C-18 would add millions of dollars to the sector and support struggling media companies, the reality has quickly intervened: blocked news sharing on Internet platforms with cancelled deals on the horizon, reports of direct corporate intervention in news departments, massive layoffs and regulatory requests to decrease spending on news, and now a nightmare merger proposal between Postmedia and Torstar. And that is just over the past week. Canadian Heritage Minister Pablo Rodriguez has amply demonstrated that there is no Plan B, offering up the prospect of further dependence on government through more public spending to mitigate the harms from his massive miscalculations. Not all of this is the government’s doing, but having relied on empty assurances that blocked news sharing was merely a bluff, Rodriguez picked politics and tough talk over good policy and is now left with media chaos.

At the top of the list is the emerging Bill C-18 disaster. It has been obvious for months that the risk of blocked news sharing was real, but the government – urged on by self-interested lobby groups – insisted news was too valuable for Meta to remove it from its platform. The company and the data said otherwise. Yesterday, Rachel Curran told CBC in unequivocal terms that ““there are no negotiations currently, we are proceeding towards ending the availability of news permanently in Canada…and there is really nothing that is going to alter that trajectory.” If that weren’t bad enough, Curran acknowledged that Facebook’s existing deals with Canadian media (there are 18 of them) did not have much a future. 

None of this should as a surprise, but the harm will be significant. I know that many will dismiss Facebook as a news source, but mainstream sources like Le Devoir say that 30% of their traffic comes from social media sites like Facebook. The negative impact – no new deals, lost existing deals, and no links – will take tens of millions of dollars off the table. Moreover, if Google were to follow suit, some news outlets have already warned that they would likely shut down. 

The government will want to blame the Internet companies, but it must look in the mirror since this is a direct result of its legislative choices. In fact, yesterday Rodriguez suggested that the solution may lie in a government bailout with more public funds to support the sector. This would be disastrous with taxpayers paying the price for government incompetence and the sector more dependent than ever on the government funding. Smaller, independent sources that refuse to take public money will simply disappear.

To top it off, the media sector itself clearly does not believe in Bill C-18. It may have lobbied for months for the bill, but once it was assured of passing, there were layoffs, regulatory requests with the CRTC to reduce news spending, and now the potential Postmedia-Torstar merger, which seems premised on the belief that if you keep entering into enough failed mergers, one of them may eventually work. 

If it was serious, the government would make it clear the merger is a non-starter, ensure the CRTC deals aggressively with interference by corporate executives on news coverage and efforts to cut back on licence obligations, and scale back Bill C-18’s mandated payments for links system by using regulations to create a fund to support journalism as an option for CRTC exemption. Unfortunately, that approach seems unlikely as the tough talk will surely continue. Yet it is increasingly apparent that Rodriguez and the government have been played for suckers and bravado is not going to fix this mess.