Local news coverage in Canada in steep decline, inviting misinformation: report

Local news coverage in Canada in steep decline, inviting misinformation: report

  • 20.03.2025 18:47
  • sudbury.com
  • Keywords: Local News Decline, Misinformation Spread

Local news in Canada is declining sharply, leaving many areas underserved and vulnerable to misinformation. Major outlets are closing, media consolidation is reducing coverage, and tech giants' dominance over ad revenue is exacerbating the crisis. Despite government efforts, solutions remain elusive.

Meta ReportsAlphabet ReportsMETAsentiment_dissatisfied

Estimated market influence

Canadian Centre for Policy Alternatives

Neutralsentiment_neutral
Analyst rating: N/A

The report was conducted by the Canadian Centre for Policy Alternatives.

Metroland Media Group

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Analyst rating: N/A

Metroland Media Group faced bankruptcy and restructuring, leading to significant layoffs and closure of outlets.

Métro Média

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Analyst rating: N/A

The company closed its operations in Quebec.

CTV

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Analyst rating: N/A

CTV contributed to the net loss of outlets with closures.

Corus

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Analyst rating: N/A

Corus also contributed to the net loss of outlets with closures.

CBC

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Analyst rating: N/A

CBC is identified as a key part of the solution, needing to expand into local and regional areas.

Google

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Analyst rating: N/A

Google secured an exemption from the Online News Act by agreeing to pay annually but continues to divert ad revenue away from news outlets.

Meta

Meta

Negativesentiment_dissatisfied
Analyst rating: Strong buy

Meta decided to block access to Canadian news on its platforms, impacting local news distribution.

Context

Analysis and Summary: Decline of Local News in Canada

Key Facts and Data

  • Decline in Local News Outlets:

    • Over 2.5 million Canadians live in areas with limited or no local news coverage, doubling since 2008.
    • Canada has lost 11% of its newspaper and online media outlets (approximately 25 per year) over the past decade.
  • Current State:

    • Total local news outlets: 2,900 across radio, TV, newspapers, and online media.
    • 2023 saw a significant drop with 83 outlet closures due to Metroland Media Group and Métro Média bankruptcy.
  • Regional Impact:

    • Every province/territory except Ontario has experienced a decline in smaller communities.
    • Ontario's marginally better situation is attributed to online-only growth, but it still lags per capita.

Market Trends and Business Insights

  • Consolidation and Job Losses:

    • Industry consolidation has led to reduced news programming and staff cuts.
    • Example: Metroland Media Group's restructuring under bankruptcy laws resulted in layoffs and digital-only models.
  • Ad Revenue Challenge:

    • Traditional ad-supported business model struggling against social media and search giants (Meta, Google).
    • Tech companies capture significant ad revenue, reducing budgets for local journalism.

Competitive Dynamics

  • Market Consolidation Risks:
    • Vulnerability of local outlets to broader industry challenges, as seen with Metroland.
    • Example: Newfoundland and Labrador lost 75% of news outlets over 16 years.

Strategic Considerations and Solutions

  • Shift in Business Models:

    • Need for new funding strategies, including online-only models and targeted advertising.
    • Expansion of public broadcaster CBC into local and regional areas.
  • Government Interventions:

    • Online News Act aimed at tech giants but deemed insufficient.
    • Digital news tax credit and Local Journalism Initiative as potential supports.

Regulatory and Long-Term Implications

  • Regulatory Measures:

    • Google's exemption from the Online News Act with annual payments, while Meta blocked Canadian news access.
    • Report suggests these measures are too little and late.
  • Long-Term Effects:

    • Risk of increased misinformation as high-quality local news declines.
    • Erosion of community information hubs, affecting public awareness and engagement.

Conclusion

The decline of local news in Canada underscores the urgent need for innovative business models and stronger government support to mitigate the loss of trusted news sources. The reliance on traditional ad revenue is unsustainable against tech giants, necessitating strategic shifts to ensure local journalism's survival.