Ontario’s approach, directing a portion of its considerable existing advertising budget towards local media publications, follows long-established practice. Pictured: Ontario Premier Doug Ford. Photo Credit: Doug Ford/X.
Every so often, a government gets it right. The recent announcement of the Ontario Government that 25 per cent of its advertising budget will be directed to Ontario news publishers is one such decision.
Why? Because Canadian news publishers have been in a losing battle with foreign tech firms like Google (now called Alphabet) or Facebook (now called Meta) for advertising dollars, the traditional revenue stream that has supported journalism’s business model since the days of the old-fashioned printing press.
They have been battling and losing. It has been bad enough for Canadian media outlets to see the content they pay to generate, being used by tech giants for their own on-line platforms, virtually for free.
But to make matters worse, some 80 per cent of Canada’s advertising spend also goes to the tech giants now too, not local news publications, digital or otherwise. Put another way, in 2012, Canadian newspaper advertising revenue stood at over $3 billion. Today, it is less than $1 billion.
For several years now, so-called “legacy” news publications have been fighting back as they try to transform themselves from print based to digital based products for the 80 per cent of Canadians who read newspaper content (both in print and on-line) each week. Upwards of 60 per cent are daily consumers.
But digital subscription revenue alone cannot sustain the high-quality journalism that readers expect or that our democracy needs to function well.
The federal government was the first to step in with salary subsidies based on the number of journalists employed by a news organization. That has been followed by legislation requiring tech giants, like Google, to pay compensation to Canadian news publications when it uses their content on its on-line platforms.
While welcomed by many in the news industry, both initiatives have generated controversy over whether such government subsidies will undermine the media’s traditional role as independent observers and who gets to decide how much of the tech giant’s money goes to which media outlets. Determining who gets how much is also generating a not insignificant administrative burden.
On the other hand, Ontario’s approach, directing a portion of its considerable existing advertising budget towards local media publications, meets with less controversy and also follows long-established practice.
As Paul Deegan, the CEO of News Media Canada, the newspaper publishers’ lobby group, pointed out in a recent news column, governments have been supporting newspapers in Canada since the 1700’s with both advertising dollars and even postal delivery subsidies in some cases.
Ontario crown agencies like the LCBO, the Ontario Cannabis Retail Corporation, the Ontario Lottery and Gaming Corporation and Metrolinx have now been directed to allocate 25 per cent of their regular, business-as-usual advertising to Ontario-based news businesses. There will not be an additional cost to taxpayers.
Good quality journalism, the kind that keeps the public informed and holds wayward politicians accountable to voters and taxpayers, is a critical pillar of a strong democracy.
As Deegan wrote, subscription revenue alone is not enough, “fact-based, fact-checked coverage of schools, cops, courts, politicians and businesses – holding the powerful to account – costs real money and demands advertising revenue.”
Janet Ecker is a former Ontario Finance Minister, Minister of Education, Minister of Community and Social Services and Government House Leader in the governments of Premier Mike Harris and Premier Ernie Eves. After her political career, she served as the founding CEO of the Toronto Financial Services Alliance, a public-private partnership dedicated to building Toronto region into an international financial centre. She currently sits on a number of corporate and non-profit boards, agencies and advisory committees.
Ms. Ecker received the Order of Canada for her public service contributions and was recognized as one of the “Most Influential People in the World’s Financial Centres” by Financial Centres International. She also received a “Canada’s Most Powerful Women: Top 100 Award” from the Women’s Executive Network and the Richard Ivey School of Business, among other awards. She is also one of the founders of Equal Voice, a national, multi-partisan organization working to elect more women.
