Google and the federal government of Canada have reached an agreement in their dispute over the Online News Act that would see Google continue to share Canadian news online in return for the company making annual payments to news companies in the range of $100 million.

Sources told Radio-Canada and CBC News earlier Wednesday that an agreement had been reached. Heritage Minister Pascale St-Onge confirmed the news Wednesday afternoon.

"Many doubted that we would be successful, but I was confident we would find a way to address Google's concerns," she told reporters outside the House of Commons.

The federal government and Google agreed on the regulatory framework earlier this week, a government source familiar with the talks told Radio-Canada.

The federal government had estimated earlier this year that Google's compensation should amount to about $172 million. Google estimated the value at $100 million.

Simplified negotiations

Along with the financial demands, Google had expressed concerns about what spokesperson Shay Purdy called "critical structural issues" with the Online News Act, also called Bill C-18.

The company said it would not have a mandatory negotiation model imposed on it for talks with Canadian media organizations, preferring to deal with a single point of contact.

The new regulations will allow Google to negotiate with a single group that would represent all media, allowing the company to limit its arbitration risk.

Kent Walker, Google's president of global affairs, thanked St-Onge for addressing the company's concerns.

"We are pleased that the Government of Canada has committed to addressing our core issues with Bill C-18," Walker said in a statement. "

The rules will be added to the C-18 legislative framework, which must be unveiled by mid-December.

Google would still be required to negotiate with the media and sign an agreement. The digital giant could also add additional service contributions, which have yet to be specified.

Google had threatened to block Canadian news content on its platforms as a result of the legislation. But unlike Meta, which ended its talks with the government last summer and stopped distributing Canadian news on Facebook and Instagram, Google has not blocked news in Canada.

A discount deal?

Faced with Google's threat to stop distributing Canadian news, the government seems to have softened its position.

But the government source argues that an agreement constitutes a victory and a net gain for Canadian media. The framework for a single negotiation is likely to serve as an example for other countries, the source added.

St-Onge said the deal with Google could be reopened if other countries introduce their own legislation and reach more favourable deals with the tech giant.

Prime Minister Justin Trudeau said the agreement was "very good news."

"After months of holding strong, of demonstrating our commitment to local journalism, to strong independent journalists getting paid for their work ... Google has agreed to properly support journalists, including local journalism," he said on his way into Wednesday's question period.

Bill C-18 applies to digital platforms with 20 million unique monthly users and annual revenues of $1 billion. Only Meta and Google meet those criteria.

Meta's talks with the government have not resumed. When asked if those negotiations could be reopened, St-Onge said it's up to Meta.

"This [deal with Google] shows that this legislation works," she said. "Now it's on Facebook to explain why they're leaving their platform to disinformation and misinformation instead of sustaining our news system."

A Meta spokesperson told CBC News it doesn't plan to allow news on its platforms in Canada while the Online News Act is law.

"Unlike search engines, we do not proactively pull news from the internet to place in our users' feeds and we have long been clear that the only way we can reasonably comply with the Online News Act is by ending news availability for people in Canada," the spokesperson said in an email.

Jeff Elgie — CEO of Village Media, which runs 25 community news websites across the country — said he was happy that Google reached a deal with the government. But he added it could have happened sooner if the government had indicated from the beginning that it would allow tech giants to negotiate with a single collective of news outlets rather than individually.

"We've created a fixed pool, or a fund model, that's going to now be distributed centrally by one bargaining unit, in proportion to the number of journalists that the members have. Which is what we thought this should be and what Google and Meta thought this should be all along," he said.

"If the Act had just said that from the beginning, I think everyone would have been happy. Meta wouldn't have left. This would have happened much more quickly."

As a news organization, CBC/Radio-Canada could see a financial benefit under C-18, which includes a requirement for CBC to provide an annual report on any compensation for news it receives from digital operators.

St-Onge said Wednesday that CBC's eligibility under the bill will become clearer when regulations are released ahead of the bill coming into force on Dec. 19.

Leon Mar, CBC's director of media relations, welcomed the government's agreement with Google.

"This agreement marks a very important step towards building a healthy news ecosystem for Canadians," Mar said in a media statement. "We look forward to the next steps in these discussions."

Credit: Daniel Thibeault/CBC/Radio-Canada