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Ottawa pressed to curb CBC’s growing digital presence

Globe and Mail publisher Phillip Crawley appears before a Parliamentary Commons heritage committee November 15, 2016 on Parliament Hill in Ottawa.

Dave Chan/The Globe and Mail

Private media companies are decrying the CBC's growing presence on the Internet and in the digital advertising market, calling on Ottawa to rein in the Crown corporation in order to salvage the production of local news and investigative journalism across the country.

At hearings of the Canadian Heritage committee of the House of Commons, the CBC is increasingly described as a great disruptor of the media landscape, with its recent budget increase of $675-million over five years coming as losses are growing and newsrooms are closing in the private sector.

The attacks place the public broadcaster in the same category as foreign Internet giants such as Google and Facebook, which many say are eating into advertising budgets of publishers and broadcasters in Canada while contributing little to the creation of Canadian content.

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The CBC is specifically facing criticism over the expansion of its presence on the Internet, including the recent creation of an opinion section on its website with columns and op-eds that are in direct competition with several newspapers.

Related:CBC joins a crowded conversation with new online opinion section

Related: Going digital is Cancon's biggest challenge, Heritage Minister says

Phillip Crawley, the publisher and CEO of The Globe and Mail, told the committee on Tuesday his company is not looking for a government handout to survive, but rather an "even playing field" in the media industry.

"It's not level if taxpayers' dollars directed to the public broadcaster make the competition for digital ad dollars more difficult. The CBC is The Globe's largest competitor in the digital ad space among Canadian-based media. My colleagues and I in the industry do not support the notion that handing out more money to the CBC helps local or national newspapers," Mr. Crawley said, arguing the CBC should face similar limits on digital advertising as the BBC.

Another witness said the CBC is increasingly stretching the bounds of its mandate to compete in new areas with upstart and legacy media companies.

"You can't have a level playing field when the public broadcaster … wants to be all things to all people," said Brian Lilley, co-founder of The Rebel Media. "There is no reason that they should be expanding digital-only platforms of opinion."

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The testimony built on previous statements to the committee from senior officials at media firms such as The Toronto Star, iPolitics, Postmedia and the Canadian Newspaper Association.

"The CBC provides a fantastic service to this country, but in many digital areas, it is set up as a competitor in the provision of news and information, creating an environment in which it is much more difficult for private enterprise to develop new, sustainable methods of providing serious journalism," Bob Cox, the chair of the Canadian Newspaper Association, said last May.

The CBC recently issued a statement defending its digital presence, saying it was "more useful than ever" in a context of media mergers and downsizing in the private sector.

"The challenges facing media in Canada are many but they are not being caused by the public broadcaster," said Heather Conway, executive vice-president of CBC English Services. "CBC/Radio-Canada does not exist to serve the interests of private businesses. It exists to serve the people who use and pay for it – all Canadians."

In an appearance at the Canadian Heritage committee earlier this year, Jennifer McGuire, editor in chief of CBC News, directly addressed the criticism that the public broadcaster is stealing digital advertising dollars from other media companies.

"Only about 1 per cent of CBC's revenue is from digital. So I think the argument that CBC somehow is cannibalizing the business case out there is not necessarily a valid one," she said.

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Officials from Google made a separate appearance at the committee on Tuesday, and rejected calls to start subsidizing the production of local news in Canada. The search giant directs billions of clicks every month to news operations around the world, and shares with publishers about 70 per cent of the revenues that are generated from display advertising on websites, Google officials said.

"I think artificial financing of journalistic efforts is an area of potential problems," Richard Gingras, vice-president of Google News, told MPs via video conference. "Is Google the one who should determine which journalists get paid and which not? No."

Mr. Gingras rejected the notion that Google has stolen ad dollars from Canadian media firms, saying his firm has created new tools as part of a global media "renaissance" that is leading to unprecedented levels of innovation in the industry.

"Google is grabbing nothing from no one," Mr. Gingras said.

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About the Author
Parliamentary reporter

Daniel Leblanc studied political science at the University of Ottawa and journalism at Carleton University. He became a full-time reporter in 1998, first at the Ottawa Citizen and then in the Ottawa bureau of The Globe and Mail. More

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