California Lawmaker Retools Planned News Fee on Google, Facebook

A California lawmaker has revised her measure that would force platforms like Google and Facebook to pay news organizations for displaying their content in a renewed bid to move the bill in face of strong tech opposition.

Assemblymember Buffy Wicks (D) reworked the bill (AB 886) after an almost year-long pause to respond to tech critics, who so far have not publicly budged over their opposition. The Senate Judiciary Committee will hold a June 25 hearing on the measure, which has passed the state Assembly and needs to clear the state Senate by the end of August.

The California Journalism Preservation Act has garnered intense pushback from tech companies headquartered in California, with both Google and Meta Platforms Inc. issuing warnings that news could be blocked on their widely used platforms. The Wicks bill has picked up more attention after a separate attempt to impose a tax on digital ads to fund news failed last month amid similar lobbying by tech groups.

Journalism advocates back the Wicks measure given the news industry’s struggle with declining ad revenues, which news publishers charged have been going to tech platforms instead. Many California lawmakers share those concerns.

“Tech platforms, at their essence, compete for our attention, and access to journalism gives them vital content that keep users engaged,” Wicks said.

New Changes

Many of the recent adjustments, which were earlier previewed by Wicks to Bloomberg Government, primarily address criticism that out-of-state news companies would have received most of the payments under the bill.

Wicks inserted language that would split any payments between news outlets proportionally based on the number of employed journalists who primarily produce content for a California audience. Not only would that change benefit local journalists more, proponents said, but it also refutes characterizations by tech groups that the bill is a “link tax” that encourages more click bait for more revenue.

“Payments from Google will be based solely on how many journalists a news publisher employs, not on clicks,” Matt Pearce, president of labor union group Media Guild of the West, said. “‘Ghost newsrooms’ or AI mills with zero journalists get zero dollars.”

Smaller news organizations and media outlets with an ethnic focus would receive a floor of funding under the changes — each getting at least 1% of total payments — in response to fears that news organizations with more employees would take up nearly all the money.

Wicks had said she wanted to provide more ways to decide how much money tech platforms should pay beyond the bill’s mandatory arbitration process and considered elements of Canada’s Online News Act. While Meta blocked news in that country, Google eventually agreed in a deal with the Canadian government to pay $74 million annually.

The revised California measure would allow both sides to avoid arbitration if they reach a voluntary agreement within 60 days. It also now includes a third option, similar to Canada’s deal with Google: an annual fee of a to-be-determined amount.

A straight-up fee, along with other changes, would “provide a more straightforward framework,” Wicks said in a statement. “While the bill remains a work in progress, I am hopeful stakeholders will see this as a step in the right direction.”

Tech Criticism Continues

Google and Meta, however, will likely continue their opposition. The two companies did not respond to requests for comment, but tech groups representing them and other members criticized the latest version of the bill.

NetChoice, a trade association of online businesses, has stepped up its attacks, claiming that government-mandated payments would erode trust in the media.

“If AB 886 is passed, free access to news online and on social media will significantly decrease, cronyism will increase, and a cornerstone of American tradition — the independent news media — will lose even more credibility,” Carl Szabo, vice president of NetChoice, said.

Adam Kovacevich, CEO of left-leaning tech coalition Chamber of Progress, said the new changes don’t solve many issues. Money can still go to local papers owned by hedge funds that have been criticized for downsizing their newsrooms, he said. The bill language that funding go to journalists “producing content for a California audience” doesn’t mean payments would go to local papers, Kovacevich added.

“That doesn’t mean local content. Fox News stories could be ‘for a California audience,’” he said.

The underlying bill will still hurt more than help newsrooms regardless, Kovacevich said, when outlets find that their reach has been diminished after Google, Meta, and others turn off news links.

Some ethnic media groups may continue to oppose the Wicks measure for that reason. Benjamin Chavis Jr., president of the National Newspapers Publishers Association, which represents Black newspapers, said in an April post that tech platforms play an important role in connecting their newspapers to the community. He expressed reservations about changing that relationship.