Sucker punch as US forces Canada to drop Meta ad ban

The US has turned up to the Big Tech tax war and it’s hyper-punchy.

The White House sent a missive overnight threatening Australia, Canada, and others warning that it sees local taxes and controls on US tech firms as “extortion”.

It said: “The GDP of the US, driven by cutting-edge tech, has been bigger than the entire economy of Australia, Canada, or most members of the European Union.

“Instead of empowering their workers and economies, foreign governments have exerted authority over the tech sector, hindering success and appropriating revenues that should contribute to our nation’s well-being, not theirs.”

Attempts to tax Big Tech on local earnings have cost “billions” in taxes that “foreign government officials openly admit are designed to plunder American companies”, it said.

America says countries have also adopted “regulations that are more burdensome and restrictive on US companies than their own”.

These “violate American sovereignty and offshore American jobs, limit global competitiveness, and increase costs while exposing our sensitive information to potentially hostile foreign regulators.

“My Administration will not allow American companies and workers and American economic and national security interests to be compromised by one-sided, anti-competitive policies and practices of foreign governments.

“American businesses will no longer prop up failed foreign economies through extortive fines and taxes.”

This is unprecedented in my 35 years in journalism, and flies in the face of more than a century of taxation precedent that companies pay tax in countries where they earn.

A week ago, the US imposed harsh tariffs on the Canadian government and the President dismissed Prime Minister Justin Trudeau as governor of his 51st State.

Trudeau was then caught on a hot mic warning the US wasn’t joking, before he overturned a two-year ban on the government advertising on Meta.

The move caught publishers and policymakers on the back foot after years of toughening restrictions on monopolistic power, and I interview them on this podcast.

Before we get to it, join me in welcoming new subs over the past few days from Google, TikTok, Uber, NBC Universal in New York, Digiday, Daily Mail in Sydney, Nvidia in South Korea, Australian FTA broadcaster Seven, the Institute for Advertising Ethics, ABC13 in Houston, Texas, mobile news aggregator SmartNews, USA Today in Nashville, the privacy and data law committee at the Law Society…

And the Financial Crimes Investigation Bureau in Los Angeles, among others. This could be fun - call me. 🤙

And how would you like to reach the top 4,000 movers and shakers driving news, tech and marketing? Sponsor Future Media…

The two emails landed in my inbox within moments of each other. Both said the Canadian government was reversing its clampdown on Meta and renewing its ad deals.

It’s shocking for a country that has proudly sought to stand up to Big Tech tyranny, but it’s also strategically sub-optimal.

Choosing to spend taxpayer dollars on a US monopoly while the country is in the midst of a trade war and in the final days before a knife-edge election looks like electoral suicide.

But just days earlier, the US shifted the goalposts by imposing tariffs and threatening the country’s sovereignty.

Soon, Trudeau’s government chose to sign off sending its taxpayers’ ad dollars offshore to the US.

And to Meta.

Which is upholding a news ban across Canada which threatened thousands of Canadian lives during devastating wildfires.

WTAF?

Only… as I’ve written again and again in this newsletter, indignation is a shitty business model and an even worse strategy.

It hasn’t worked for 25 years and won’t work now.

So, this podcast will do more than that, and to get to some answers, I’m joined by two fearless media industry leaders who have been leading the fight against Big Tech.

In one corner is Lisa Sygutek, the local newspaper owner spearheading a $4 billion class action against Google, and who’s battling to drag Meta in for $4 billion more.

And Paul Deegan, the CEO of News Media Canada, the industry group which was instrumental in forcing Google to pay publishers $100 million for using their content.

Our chat pulls no punches, as is our style…

Now back to Canada to decipher a cluster-f which seems as implausible as it is unwise.

Let’s find out together, because this is Future Media. Let’s go…