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Justin Trudeau is mad as hell and he’s not going to take it anymore. At least, that’s how he sounded when talking about 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 $40 million worth of its licensing fees. “We need those local voices, and over the past years, corporate Canada — and there are many culprits on this — have abdicated their responsibilities toward the communities that they have always made very good profits off of,” Trudeau said. “So yeah, I’m pretty pissed off.”
He wasn’t the only one. On the other side of the country, the premier of British Columbia was taking his own swipes at BCE. “They bought them up, like corporate vampires, they sucked the life out of them, and have overseen the crapification of local news by laying off journalists, and now they say that it’s no longer economically viable,” David Eby said. “Bell and other companies like Bell that have done this need to be held accountable for the information atmosphere that we find ourselves in today.”
Their anger is understandable. In 2023, Bell Media — the division that includes outlets like CTV and TSN — reported an operating profit of $697 million. Its profit margin for the year was 22.4 per cent, down from 28.8 per cent in 2022. And, of course, the broader BCE enterprise includes its massive telecom business that successive federal governments have both directly incentivized and protected from meaningful foreign competition. If there was ever a business that owed Canadians for their help, it’s this one.
Then again, it’s kind of pointless to get mad at a corporation for behaving like, well, a corporation. If anyone ever believed companies like BCE and Rogers were going to meaningfully subsidize the production of news and information simply because it’s in our shared interest, they’re either naive or foolish. The fact these companies are still profitable misses the point, which is that they’re always looking to become even more profitable. And right now, the media business keeps getting less profitable by the second.
True to form, Pierre Poilieve and his Conservative caucus colleagues immediately tried to blame the Trudeau government for these layoffs. Conservatives even tried to blame the Liberals for the $40 million in “regulatory relief” BCE received recently as part of a 2022 amendment to the Online Streaming Act. One small problem: said amendment was proposed by none other than Conservative MP John Nater and was actually opposed by the Liberals on his committee. So much for that theory.
This reflexive partisanship of Poilievre and his party deliberately ignores what’s happening to the media industry outside our borders, where layoffs and closures are the order of the day. Given that backdrop, it’s pretty hard to blame federal government policy in Canada for the media’s continued woes. Yes, its legislation aimed at shoring up the media hasn’t delivered on the dollars it promised, and corporations failing to live up to their promises from more than a decade ago hasn’t helped, either. But as media consultant Grant Ainsley wrote, “The real problem is advertisers have many other options, most of them sexier. The billions of dollars that used to go into Canada’s newspapers, magazines, and TV and radio stations are now going into U.S. internet monsters like Meta, Google and Amazon.”
If the Trudeau Liberals want to do more than just keep Canada’s legacy media on life support, they need to think much bigger. One potential opportunity is a so-called “Canadian TV Distributor Tax.” Barry Kiefl, president of Canadian Media Research Inc. and former research director for the CBC, laid out the case for such a tax back in 2014, estimating it could generate $3 billion in new revenues. “Rather than a TV licence fee paid by consumers, the federal government could introduce a special, dedicated corporate tax of seven per cent on total revenues of all TV/video distributors, i.e. cable and telecommunication companies. Consumers would not be asked to pay: Rogers, Bell, Telus, etc., would pay the tax on their total revenues.”
That’s all their revenues, by the way, which includes their ever-expanding online connectivity business. With just a portion of that pie, the federal government could fully fund the CBC and wean it off its growing reliance on advertising, thereby freeing up those advertisers for other media outlets. The remaining billions could be used to fund new media startups through a tax credit for digital subscriptions or some other platform-agnostic program. It could even fund the costs associated with a new charitable designation for media companies that do long-form reporting or research.
Yes, the telecom companies would surely cry foul. They might try to threaten more layoffs. But they’ve been handed a de-facto licence to print money by the federal government and it can be revoked at any time. A seven per cent corporate tax, by comparison, probably seems like a steal.
Instead of getting mad, maybe it’s time for the government to start getting even.
Comments
Splitting them up in anti-trust action and preventing media from having more than two venues would help, an online presence plus one of, print, television, or radio would increase the number of voices/sources in news media.
Or maybe they could use the money from spectrum licenses to fund media. The telecommunication companies pay the government a lot of money to buy radio licenses. I agree with your premise though, large corporations do not operate their businesses in silos. They will not tolerate a money losing business segment, while others are profitable. 7% tax on top-line revenues seems harsh though, that would cause them to either cut costs or increase prices to pay for it. Cable companies are under threat from streaming services, seems like the government should focus more on where the actual ad dollars are going and get more from META, Google, Facebook etc.....than they have.
So put another tax on media corporations? But you have to get them to promise not to pass it on to consumers. Idiot.
So break up their monopolies first. But it's not actually so easy to pass tax expenses on to consumers as people often imagine and economists who speak for companies often claim. If it was, they wouldn't spend all the money they do lobbying for lower corporate taxes.
Good idea, and good link from the New Yorker encapsulating what's happening.
With such frantic fractiousness and chaos, that old-is-new-again idea of a respected, quality PUBLIC broadcaster inspires as much nostalgic longing as a reliable PUBLIC health system for everyone does now, and a comprehensive, vibrant PUBLIC school system. Oh, sweet sanity.
And finally calling out corporations as the ACTUAL entities responsible for most of our current societal woes, entities for whom profitability has devolved into a spur for ever MORE profit-taking until the game runs out of chips and/or SOMEONE is officially declared winner of it all and/or king of the world, is WAY overdue, as is a reckoning, period.
Laid bare for all to see, this hidden truth could also rearrange our political mess and restore it to what IT was before by replacing government as whipping boy in general, thereby exposing not only the fundamental AND fundamentally rotten philosophical underpinnings of the conservatives, but also the very specific fanaticism of their disturbing laser focus on Trudeau personally. It's like they're a bunch of throwback closet gay/religious guys, sporting all those F*ck Trudeau signs everywhere, even on their TRUCKS.
I mean, the guy IS objectively kind of beautiful, especially compared to other politicians, and look at his hands-- strong and graceful, often held hesitantly, some might say, almost effeminately, which also seems to have driven those "bad" boys crazy.
But the fact that he can also box effectively with them is what makes him a leader for the times. David Eby is no macho guy either....