Just before the holidays, the Canadian Media Concentration Research Project released its two annual reports diving deep into the state of Canadian media and advertising.
Led by professor Dwayne Winseck from Carleton University’s School of Journalism and Communication, the independent research’s core purpose is to assess if Canada’s communications, media and internet industries have become more concentrated, and therefore subject to the problems and abuses that can arise from a lack of competition.
In doing so, it provides a detailed picture of the media and advertising landscape in Canada, and how it has changed over the years. Unsurprisingly the biggest change agents in recent years have been Google and Facebook.
The telecommunications, internet and media industries in Canada, which the CMCRP refers to as the “network media economy,” generated revenue of $91.3 billion in 2019. The “big six” tech giants—Google, Facebook, Netflix, Amazon, Twitter and Apple—had combined revenue of $9.3 billion.
By comparison, BCE had revenue of $24.9 billion, representing 28% of the total network media economy, with the top five Canadian companies (Bell, Telus, Rogers, Shaw and Quebecor) accounting for 72.5% of the total network economy.
The picture changes markedly when the focus is just on advertising, however. Here’s some of the key data:
- $15.6 billion: Total ad market in Canada in 2019.
- $8.8 billion: Total online ad market in Canada in 2019, up from $7.7 billion the year before.
- $4.8 billion: Google’s Canadian ad revenue in 2019, up from $1.4 billion in 2011. Google takes in 50% of all online advertising in Canada.
- $2.6 billion: Facebook’s Canadian ad revenue in 2019, up from $181.4 million in 2011.
- 80%: Google and Facebook’s share of the total online ad market, up from about 66% four years ago.
- 45%: Google and Facebook’s share of ALL ad spend in Canada in 2019, up from 36% in 2017.
While the growth of Google and Facebook is often blamed for at least some of the problems faced by traditional media, and the authors conclude that Google and Facebook constitute a digital duopoly for online advertising in Canada, they point out that “they do not dominate the total advertising market.”
What’s more, they write, advertising comprises a small and declining part of the overall media economy as, for example, revenue from subscription based media increases.
However, the case that Google and Facebook aren’t the destructive forces they are sometimes depicted as by traditional media also explains the tough times felt by ad agencies in Canada. “[T]he scramble for advertising dollars is coming to a head exactly at the moment when advertising spending appears to have stalled and even declined over the last decade when measured, in inflation-adjusted dollars, on a per-capita basis.”
In other words…
