Justin Trudeau is very angry and he’s not going to take it anymore. At least that’s how he sounded when discussing BCE Inc.’s decision to lay off hundreds of journalists as part of a cost-cutting exercise just months after a House of Commons committee voted to waive their rights. of license worth 40 million dollars. “We need those local voices and in recent years, Canadian companies – and there are many to blame for this – have abdicated their responsibilities to the communities from which they have always made very good profits,” Trudeau said. “So yeah, I’m pretty angry.”
He wasn’t the only one. On the other side of the country, the premier of British Columbia was attacking the ECB. “They bought them out, like corporate vampires, sucked the life out of them, and oversaw the crap of local news by laying off journalists, and now they say it’s no longer economically viable,” David Eby. saying. “Bell and other companies like Bell that have done this must be held accountable for the information atmosphere we find ourselves in today.”
Your anger is understandable. In 2023, Bell Media, the division that includes outlets such as CTV and TSN, reported an operating profit of 697 million dollars. Its profit margin for the year was 22.4 percent, up from 28.8 percent in 2022. And of course, the ECB’s broader enterprise includes its huge telecommunications business, which successive federal governments have incentivized directly and protected from significant foreign competition. If ever there was a company that owed Canadians help, it’s this one.
On the other hand, it’s pointless to get angry at a corporation for behaving like, well, a corporation. If anyone ever believed that companies like BCE and Rogers were going to significantly subsidize the production of news and information simply because it is in our shared interest, they are either naïve or foolish. The fact that these companies are still profitable misses the point: they are always looking to become even more profitable. And right now, the media business is becoming less and less profitable.
Faithful to their customs, Pierre Poilieve and his colleagues from the conservative group He immediately attempted to blame the Trudeau government for these layoffs. conservatives even tried to blame to the Liberals for the $40 million in “regulatory relief” BCE recently received as part of a 2022 amendment to the Online Broadcasting Act. One small problem: said amendment was proposed by none other than Conservative MP John Nater and in fact, the liberals on his committee opposed it. So much for that theory.
This reflexive partisanship of Poilievre and his party deliberately ignores What is happening with the media industry? outside our borders, where layoffs and closures are the order of the day. Given that context, it’s pretty difficult to blame Canada’s federal government policy for the media’s ongoing problems. Yes, his legislation meant to prop up the media hasn’t delivered the dollars he promised, and corporations aren’t living up to it. his promises from more than a decade ago It hasn’t helped either. But as media consultant Grant Ainsley states wrote, “The real problem is that advertisers have many other options, most of them more attractive. The billions of dollars that used to go to Canada’s newspapers, magazines, radio and television stations now go to American internet monsters like Meta, Google and Amazon.”
If the Trudeau Liberals want to do more than just keep Canada’s traditional media on life support, they need to think much bigger. One possible opportunity is the so-called “Canadian television distributors tax.” Barry Kiefl, president of Canadian Media Research Inc. and former CBC research director, presented the case for such a tax in 2014, estimating it could generate $3 billion in new revenue. “Instead of a television license fee paid by consumers, the federal government could introduce a special seven percent corporate tax on the total revenues of all television and video distributors, that is, cable and telecommunications companies . Consumers would not be required to pay: Rogers, Bell, Telus, etc., would pay the tax on their total income.”
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By the way, that’s all of his income, which includes his ever-expanding online connectivity business. With just a slice of that pie, the federal government could fully fund the CBC and reduce its growing dependence on advertising, thus freeing up those advertisers for other media outlets. The remaining billions could be used to fund new media companies through a digital subscription tax credit or some other platform-agnostic program. It could even fund costs associated with a new charitable designation for media companies that conduct long-form reporting or investigations.
Yes, telecom companies would surely complain. They could try to threaten more layoffs. But the federal government has given them a de facto license to print money and can revoke it at any time. By comparison, a seven percent corporate tax probably seems like a bargain.
Bell Media’s recent layoffs were a slap in the face to both journalists and the public they serve. Now is the time for the federal government to start responding harshly to Canada’s corporate media conglomerates.
Instead of getting angry, maybe it’s time for the government to start getting revenge.