Circling the Drain, and Being Paid to Do It

Opinion
By
Mark Bourrie
June 27, 2023
Water going down a drain pipe

Retch-inducing update: PostMedia and Toronto Star — which owns the KW Record, Hamilton Spectator and many small-town papers, are in merger talks., and it looks like a done deal. I thought this would happen in a few years. Things are worse than I thought.  

n the 1990s, Reader’s Digest was the best selling magazine in Canada. For years, the federal government tried to protect Canadian consumer magazines from competition from this publishing behemoth, whose products littered washrooms and doctors’ offices across Canada.

Time magazine was another big player. It was the world’s most important news magazine, with bureaus on every continent and all the major nations, including Canada. Both publications put out Canadian editions. In print journalism, this was called a “replate”. Local content from, say, the U.S. was taken out and Canadian stories were stuck in.

These magazines were extremely mainstream, quite conservative by the standards of the time. Their gigantic publishers made sweetheart deals with the Canadian government to allow Canadian companies to write off ad spending in those two magazines, but not in any other foreign publication.

I know this is boring, but there’s not much more to go

By the 1990s, all the major political parties embraced Free Trade, or at least stopped arguing about it. Eventually, the free traders got around to dismantling the tax rules that protected Canadian magazines from foreign competition. At about the same time, computer graphic cards were becoming much cheaper and dial-up Internet was displaced by wireless.

This was bad news for Canadian magazines. Until then, they’d been doing alright. Canadian Geographic was at least as good as National Geographic (and still is), Equinox could compete with any science magazine imported to Canada, and was much cheaper than its best competitor, The New Scientist.  Maclean’s was a solid weekly, part of a stable that included fat lifestyle magazines like Chatelaine and Flair. (Maclean-Hunter published lucrative French editions of Maclean’s and Chatelaine, along with dozens of special-interest and industry-specific publications.

After the tax changes, the feds knew they had to do something to “save” Canadian magazines, so they created the Canadian Magazine Fund. This program was supposed to give grants to publishers that were to be used for extra journalism. Presumably, the space left by the departed advertising would be filled with high-quality new content.

“Oh, happy day!” we magazine writers thought. “There’s gonna be more space and maybe even higher rates for our work!”

I’m sure most of you see where this is going.

The publishers kept the money. Writers saw their incomes wither, and most got real jobs. Magazines kept to their ads-to-journalism space ratio and the magazines got thinner while prices were jacked up. For reasons unknown to magazine publishers – most of whom were part of Canada’s small, inbred tribe of media managers and proprietors – Canadians balk at paying $8 for a magazine that’s as thick as a nickel.

So magazines started to die, or went web-only, which is the same thing.

The Canadian Magazine Fund was lobotomized from Canadian media and political history. Google it and see.

In 2008, the Harper government combined the magazine fund with the ancient postal subsidies given to print material to create the Canadian Periodical Fund, which still pays the magazine industry that doesn’t exist anymore to produce magazines that no one reads. Fresh off this success, it has branched out to newspapers.

More recently, Canadian newspaper owners set up their own lobbying agency and convinced the feds to create the Local Journalism Initiative (which subsidizes individual journalists covering local news for small and big outfits), the Journalism Labour Tax Credit and the Digital Subscription Tax Credit (which, respectively, gives big write-offs to media companies and gives subscribers tax deductions for paying for paywalled news). The Trudeau government also gave direct subsidies to media corporations – direct bailouts along with generous pandemic relief.

All this might be fine if Canadian publishers hadn’t acted the way the magazine industry did earlier in the century. If the Canadian people are going to subsidize media, then that media should use the money to, at the very least, maintain its pre-subsidy levels of coverage.

But this has not been the case. Cuts, cuts, cuts. Canadian media news is always about cuts. First, there was the “convergence” nonsense parroted by journalism school profs that reporters would work for print organizations integrated into broadcast monopolies. They would do TV hits, post on the web and write stories for newspapers.

This was a wanker’s fantasy, one based on the idea that journalists were as unproductive as journalism profs, and could be made to do much, much more in the course of a shift.

It also required people to pay on Wednesday for news they got free on Tuesday. Not the most brilliant business model.

Since then, Canada’s largest newspaper chain, Postmedia, has asset-stripped its papers and sold its real estate. Newsrooms are a thing of the past in most Canadian cities. And if those rooms existed, there would be no staff left in them. (The Ottawa Citizen newsroom was converted to a roller skating rink.)

Promise after promise has been broken. PostMedia’s promise to keep the Sun and former Southam newspapers as separate entities is a good place to start. Now the Sun papers are simply fliers, with a few underpaid or unpaid troglodyte columnists and most of their stories taken from the National Post, the Ottawa Citizen, the Calgary Herald, and the Edmonton Journal.

The news industry has shown itself to be much more skilled at lobbying than it is at covering Canadian news. Bill C-18 creates a system where Canadian media can shake down social media companies. The tech bros invented a better mousetrap and took the newspapers’ ads. Making a ludicrous claim that social media platforms have net gains from linking to (usually paywalled) news stories, the news publishers want to claw some ad money back.

We know how this will go. In a year, Canadian newspapers will have some of that tech money, but they won’t have more reporters. They’ll miss just as many stories. Their community presence will be minimal. In five years, some of them will be dead.

It didn’t have to be that way. The New York Times and the Guardian showed how quality publications with differing ownership structures could make money. “Digital” and “crap” do not have to be synonymous.

In Canada, The Globe and Mail still makes the cut. It can be infuriating. It can get stories spectacularly wrong. It’s made serious mistakes, like cutting its arts and culture coverage. But the Toronto Star is going the way of PostMedia, and PostMedia is bleeding itself to death.

And broadcast media? An industry that is the poster boy for regulatory capture?

Bell just laid off 1,300 people, including some of the best journalists in Canada. It is consolidating its various newsrooms into one. And you can be sure that this new beast will be much less than the sum of its parts. Bell also wants to cut local TV coverage, which is the only real public benefit Canadians receive from Bell’s lucrative TV licenses. If it gets away with this, Bell’s tiny group of competitors will follow suit.


My recommendations, for what they’re worth:

  • The Trudeau government needs to have real consultation on the state of journalism in Canada. It needs another Royal Commission.
  • It needs to be willing to tear down the whole regulatory structure. This includes the CRTC.
  • It should reconsider the rejection of the Kent Commission’s recommendation for a national print publication funded and managed in the same way as the CBC. At the same time, it could split CBC’s web coverage from its broadcast service and use it to start this new national coverage organization.
  • There can be no bailouts or subsidies without conditions that require the recipients to add the subsidy money to current spending for a substantial net gain in journalistic output.
  • Funding should be extended to very small media outlets in rural markets, as long as those outlets can show they are engaged in legitimate journalism.
  • The federal government should finance journalism only when outlets can show they have professional standards of fairness and accuracy, give the right of reply to critics, and discipline staffers who make serious errors.


I’m not holding my breath that any of this will happen, but something’s got to give.