Google and Facebook continue to dominate the $8.8 billion internet advertising market in Canada. In 2019, for example, their combined share of the online advertising market climbed to 80%, a significant increase from 72% in 2016.
According to a Leger Opinion poll conducted in January 2021, Canadians believe that Google and Facebook have become too powerful. Eight in ten Canadians believe it’s time for the federal government to take action and force social media giants Google and Facebook to pay Canadian news publishers for their content, and ensure fair negotiations so that publishers get their fair share of online advertising revenue.
A recent report from the Canadian Media Concentration Research project confirms Google and Facebook’s dominance in online advertising. Google’s revenue in Canada reached $4.8 billion in 2019. It now dominates in the following areas:
- online advertising (50% market share);
- search (92% market share);
- mobile search (91% market share);
- desktop browsers (62% market share);
- mobile browsers (48% market share); and
- app stores (43% market share).
Facebook’s user base and revenues have risen greatly within Canada as well. Last year, it had 21.5 million Canadian users across its three main services (i.e. Facebook, Instagram and WhatsApp) and revenue of $2.6 billion. After a slow start, Facebook has benefitted greatly from the shift to the mobile Internet since 2012, and through its acquisitions of Instagram and WhatsApp in 2012 and 2014, respectively.
The broad support for government action is driven by a concern that Canada’s news industry is in a precarious state. According to the poll, 62% of Canadians are worried about the loss of Canadian news publishers. Asked why they are so concerned, 73% fear a loss of reliable national news, while 63% worry about a loss of reliable news and information about their community.
Reporting real costs real money. By preventing news media from accessing advertising revenues, and by circulating news content without compensation, the tech giants are cutting off the financial lifeblood that keeps them operating. The results have been disastrous: the creation of vast “news deserts” without local news media in the US, and according to the Local News Research Project, the shuttering of more than 300 newspapers since 2008 here in Canada.