According to an internal briefing note obtained by Blacklock’s Reporter, nearly 80 Canadian news outlets have been forced to close since the beginning of the COVID-19 pandemic in 2020. This is despite the federal government introducing $595 million in media subsidies in an effort to support the struggling sector.
The briefing note, which was prepared in March for Heritage Minister Pablo Rodriguez, revealed that of the 78 news outlets that closed, 65 were community newspapers. On the other hand, 57 local news outlets were launched during the same time period. These included two TV stations, five radio stations, nine community newspapers, and 41 online news organizations. The note did mention that some news organizations have experienced stability and growth due to the government’s support and an increase in advertising revenue.
Although there have been some positive developments, such as the reopening of 16 community newspapers since the peak of the pandemic lockdowns, overall job losses within the industry have continued to rise. The note also acknowledged that the previous subsidies provided by the government were temporary in nature.
In 2018, the federal government unveiled a $595 million funding package aimed at assisting the news sector. This included subsidies such as a 15 percent subscription tax credit and a 25 percent payroll rebate, worth over $13,700 per newsroom employee. These subsidies were initially intended to last for five years, expiring in March 2024.
However, the chief lobbyist for newspaper publishers in Canada, Paul Deegan, testified before the Standing Senate Committee on Transport and Communications earlier this year and argued that additional subsidies and federal legislation are necessary to prevent more media outlets from closing. Deegan described the current situation as a “market failure” and emphasized the need for government intervention to address the issue.
Thomas Ripley, an associate assistant deputy heritage minister, supported this sentiment and told the committee in April that despite the government’s subsidies, there has been a significant decline in journalists. Ripley stressed that multiple interventions are required to address the ongoing decline in the news sector.
In response to the industry’s struggles, the federal government recently passed the Online News Act. This legislation is designed to increase the revenue of Canadian news outlets by obligating tech giants like Google and Meta to pay for any content linked or shared on their platforms. However, both companies have threatened to block Canadian news for their users within the country once the act takes effect in December.
The challenges faced by the Canadian news industry remain significant, with the closure of numerous outlets highlighting the ongoing financial strain. The government’s previous subsidies provided some relief, but further action is needed to ensure the survival and sustainability of the sector.
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