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Google will pay $100 million in a year to Canadian media companies

Taslima Jamal

The Online News Act obliges tech giants to enter into compensation agreements with news publishers for content displayed on their sites, which will contribute to the news companies’ revenues.

Canada’s controversial Online News Act is set to come into effect by the end of this year. In this situation, Ottawa has agreed to determine the maximum annual amount of 100 million that Google has to pay in favor of Canadian media companies.

The November 29 announcement is a form of capitulation by the Liberals to the tech giant. Google threatened to pull the Canadian media company’s news from its platform last February in protest of the controversial law.

The Online News Act obliges tech giants to enter into compensation agreements with news publishers for content displayed on their sites, which will contribute to the news companies’ revenues. The formula mentioned in the government’s draft policy for the implementation of the bill calls for Google to pay 172 million dollars in favor of news companies. Google said they think the figure will be closer to $100 million. They said this based on previous estimates by Canadian Heritage officials.

They seem to have got what they wanted after negotiating an extended term. Still, Canadian Heritage Minister Pascal Saint-Ange claims it is historic. On November 29, he said, the agreement is ultimately a victory for the government and local news publishers.

“We found a way to answer the questions Google had about the process and the law,” he said on Parliament Hill. Google wanted a specific figure on how much compensation Canadian news outlets would have to pay. Canada reserves the right to open up its policies if there is a better deal elsewhere in the world.

Kent Walker, Google’s president of global affairs, thanked the minister for attending several productive meetings and addressing their concerns on how to resolve the issue. In a statement, he said, the company’s main issues with the bill have been resolved through extensive discussions.

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