California Bill Could Force Big Tech to Pay for News Content

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Will Young

Tech giants such as Facebook and Google may soon have to pay publishers for news content under a new California bill aimed at reining in Silicon Valley’s dominance. The proposed California Journalism Competition and Preservation Act, introduced by Assemblymember Buffy Wicks, would require digital advertising giants to pay news outlets a “journalism usage fee” when they sell advertising alongside news content. The bill would also mandate that publishers invest 70% of the profits from that fee in journalism jobs.

The legislation has received strong support from news advocacy groups, including the California News Publishers Association and the News/Media Alliance, with the Los Angeles Times backing the proposed bill as a member of both organizations. According to CNPA Chairperson Emily Charrier, “Big Tech has become the de facto gatekeeper of journalism and is using its dominance to set rules for how news content is displayed, prioritized, and monetized. Our members are the sources of that journalism, and they deserve to be paid fair market value for news they originate.”

Danielle Coffey, Executive Vice President of the News/Media Alliance, hopes that Congress reintroduces legislation at the federal level “to give news publishers across the U.S. the same ability to be fairly compensated by the dominant tech platforms.” However, Facebook’s parent company, Meta Platforms, and Google have opposed the federal bill and declined to comment on the proposed California bill.

Meta published a statement via Twitter in December that said it would “consider removing news from our platform altogether” if federal lawmakers moved ahead with the legislation. The statement also argued that “publishers and broadcasters put their content on our platform themselves because it benefits their bottom line.” Wicks believes that the proposed California legislation would level the playing field by ensuring that publishers are fairly compensated for their work rather than exploited by tech platforms.

In contrast to Google’s platform, which aggregates content from news sources, Facebook’s users are the ones reposting news content to its site. Even so, Wicks contends that Facebook still bears responsibility for how the algorithm promotes content and displays it in a way that might keep users on the platform rather than clicking through links.

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Wicks was inspired by the success of similar legislation passed in Australia in early 2021, which led to digital platforms paying nearly $140 million to Australian news organizations in its first year, according to the Columbia Journalism Review. One Australian publisher estimated that tech money could fund up to 30% of editorial salaries. However, Meta blocked access to news content in Australia for several days when that law was initially proposed, but later reversed the decision after talks with the government.

Google has invested in several partnerships with news organizations over the last few years, including the Google News Showcase to pay publishers for content placed in Google’s new products and the Google News Initiative, which offers training, tools, and funding for local newsrooms. Google has also said news publishers keep more than 95% of the advertising revenue they generate from using Ad Manager on their websites.

Tech industry trade group NetChoice, which includes Meta and Google, opposed the federal bill and also opposes the California measure, saying it would “harm free speech online.” Carl Szabo, Vice President and General Counsel of NetChoice, called the proposed legislation a “failed proposal” copied from the federal government.

The California bill will first go through the state Assembly’s Privacy Committee, and Wicks hopes to garner bipartisan support for the legislation on the principle of protecting democracy. Wicks said, “Ensuring that we have a vibrant press is critical, and the fact that it has been declining significantly over the last decade or so to me is incredibly concerning. I’ve worked closely with Republicans in the past on supporting bills that hold big tech accountable, and that’s my goal again this year.”

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