Latest Data: Canadian Media Needs Facebook More Than Facebook Needs Canadian Media
As we've discussed widely, the entire premise of various link tax bills has never made sense. They're pushed by the media and politicians insisting that Google and Facebook are unfairly profiting" off of their news. Except that's never made any sense at all to anyone who looked at the situation carefully.
First of all, links to news has never been particularly important to either Google or Facebook. It's always been a small part of what they do, and almost always not a key part of monetizing anything, but just as an extra feature (Google, famously, barely monetizes Google News at all).
Second, as we just discussed on our recent podcast, in the pre-internet era, the largest expense for newspapers was printing and distribution, and the internet basically removed the vast majority of those expenses, and gave them a system to do both for basically nothing.
Third, Google and Facebook were then sending traffic to these news sites for free. And we know that the news sites valued that free traffic, because if they didn't they (1) could easily block it, and (2) wouldn't hire SEO and social media experts to help try to get more such traffic. Indeed, there was tremendous empirical evidence suggesting that the news orgs got way more benefit from Facebook and Google sending them traffic than either Facebook or Google got from having links to news on their platform.
And, now, with Canada's C-18, we're seeing even more evidence making this point. As you'll recall, C-18 is Canada's version of a link tax that was signed into law earlier this year, and which will go into effect soon. However, both Meta and Google have said that they will respond to this by blocking links to news in Canada, and Meta has already done so.
And while Canadian media orgs and politicians completely lost their shit about this, effectively claiming that Meta linking to news sites is theft" and not linking to news sites is corrupt, you'd think that maybe someone in the Canadian government would realize just how bad all this looks.
The latest is that, once again, the actual market is showing that the news orgs appear to need Facebook and Google way more than Facebook or Google need news. First there was a report showing that the lack of news links in Canada did literally nothing to Facebook's traffic.
Daily active users of Facebook and time spent on the app in Canada have stayed roughly unchanged since parent company Meta started blocking news there at the start of August, according to data shared by Similarweb, a digital analytics company that tracks traffic on websites and apps, at Reuters' request.
Another analytics firm, Data.ai, likewise told Reuters that its data was not showing any meaningful change to usage of the platform in Canada in August.
So, all this talk about how Facebook needed news to keep users on the site... the reality is that, no, they did not.
Of course, if we check in on the other side of the equation, we see that maybe the news orgs actually kinda relied on that traffic more than Facebook did. There was a CNN report claiming a dramatic drop" in traffic from Meta to news orgs, but that's to be expected, given it was going from whatever it was to basically zero. The question is how much of their traffic does that represent.
A quick look around at Canadian news orgs suggests that (unlike Facebook's traffic), the traffic to news orgs in Canada has mostly (though not entirely) declined since the block went into effect in early August. The Toronto Star showed a decline in visitors from July to August of 1.6 million visits, according to Similarweb. The NationalPost was down about 300k visits. The TorontoSun was down about 500k visits. CTV News also lost about 500k visits.
Of course, not all news orgs saw their traffic decline. Two of the biggest actually saw a bump up in traffic: CBC.ca and the Globe and Mail both saw their traffic jump up a bit, perhaps because as Canadians look for other sources for news, they were more likely to go directly to two of the most well known news sites for Canadians.
Along those lines, another report, this time from Insider, notes that those Canadian news orgs with apps saw app usage increase in August:
Yet, because of the loss of access on Facebook and Instagram, several major news outlets in Canada are seeing an uptick in downloads and usage of their own apps, according to an analysis from Apptopia. The apps of CTV, and Globe and Mail, as well as French language outlet La Presse, saw thousands more downloads in August compared to July, when content was still available on Meta's platforms.
The Globe and Mail in August saw a 98% increase in app downloads and a 27% increase in daily users; CTV News saw a 157% increase in app downloads and an 83% increase in daily usage; La Presse saw a 32% increase in app downloads and an 8% increase in usage; and The National Post's downloads were up almost 10%, with daily usage up 3%. Meanwhile, CBC News saw downloads and daily usage remain relatively flat.
All in all, it looks like maybe it doesn't much matter if Meta doesn't link to news sites. Of course, you can argue this is a good result for basically everyone involved: getting rid of news doesn't harm Facebook, and the media get more direct traffic. Though, of course, if you listen to Canadian politicians you'd think it was the end of the world. PM Justin Trudeau acted as if this is all about corporate profits," but that literally makes no sense.
Again, as everyone tried to explain to Canadian politicians from the beginning, none of this makes sense. It requires paying for something that should never be paid for, so it's entirely reasonable to just stop hosting news links. It's not about corporate profits," it's about recognizing the problems of paying for links fundamentally.
Either way, though, the early results suggest that Facebook made the right decision here, while the Canadian government looks extremely foolish.