Bill stalls to make Big Tech pay California publishers for news

​Signaling potential trouble for an effort to ​help news organizations survive in the internet age, a bill that would force Google, Meta and other big technology firms to pay media companies in California for using their content was pulled back Friday, July 7.

The bipartisan California Journalism Preservation Act (AB 886) had been scheduled for a hearing next week in a state Senate committee after the Assembly passed it last month. But in an abrupt reversal of momentum, the bill, strongly opposed by major tech firms, has now been sidelined until next year.

The halt comes as Google and Facebook’s parent company Meta battle similar efforts in Canada and Australia, threatening to pull news from their platforms. Meta has made a similar ultimatum in California.

The California bill aims to bolster the finances of traditional news outlets, which have struggled even as their content has helped digital-advertising giants attract users to their platforms.

State Sen. Tom Umberg, D-Santa Ana, and Assemblymember Buffy Wicks, D-Oakland, announced the decision Friday to convert it to a two-year bill.

“Assemblymember Wicks and I have agreed to schedule Assembly Bill 886 for a vote in committee in 2024, preceded by an informational hearing this fall,” Umberg said in a statement. “This interim hearing underscores my commitment to protecting journalism, California journalists, and the access to a free and vibrant press that is essential to our democracy.

“My greatest concern is that we enact legislation that is fair, and that the benefits in this bill flow specifically to support local journalists – and in turn, all Californians. I look forward to working with Assemblymember Wicks and my colleagues to help save this foundation of our democracy.”

Wicks on Friday acknowledged that big tech firms have conducted a “lobbying frenzy” against the bill “since day one,” but she insisted that support in the legislature has not waned.

She noted that Meta at the end of May threatened to pull news from Facebook and Instagram if the bill were enacted, and a day later the Assembly passed the bill 55-6.

“Big Tech isn’t as sympathetic a figure as they once were,” Wicks said. “Lawmakers realize there’s a real problem here. We have dying newsrooms across the state of California. Over 100 publications have closed in the past 10 years. At the same time we have Big Tech making record profits in part off content that the publishers have produced.”

Wicks said she introduced the bill at the start of a two-year legislative session because she knew it would take time to hash out. “There are two-year bills that people turn them into two-year bills to have them go die a slow death quietly — that is not what’s happening here,” she said. Nevertheless, legislators scuttled a scheduled hearing for the bill in the Senate Judiciary committee, a signal that not everything is happening according to plan.

Google and Facebook’s parent firm Meta take in nearly half of all digital advertising revenue worldwide, according to an April bulletin from Insider Intelligence. Over the past decade, newspaper advertising has plummeted 66% and newsroom staff numbers have fallen 44%, according to the bill.

Meta, in a statement Friday, blasted the legislation, repeating its pledge that if AB 886 passes, “we will be forced to remove news from Facebook and Instagram rather than pay into a slush fund that primarily benefits big, out-of-state media companies under the guise of aiding California publishers.”

Google said Friday in a statement that it supports strengthening the news business in California, but believes passage of the bill could hurt smaller publishers and favor large, established ones. Late last month, responding to passage of similar legislation in Canada, Google said it would pull links to Canadian news from its Search, News and Discover platforms in that country.

Google and Meta, in Australia, pledged to curtail news there after that country in 2021 became the first to enact such a law, and Meta blocked Australian news pages for a short period. But later both firms struck deals with news companies, and in the following year the two companies paid more than $134 million to Australian “news media businesses, large, medium and small,” according to a report by a former Australian regulator.

The California bill would force large online platforms that present the news content of eligible online publishers to negotiate with the publishers for a share of a platform’s advertising revenue.

The bill is sponsored by the California News Publishers Association, to which the Southern California News Group belongs, and backed by a number of print and broadcast news companies. It is opposed by a range of groups, including the ACLU of California, the California Taxpayers Association, the California Chamber of Commerce, the Electronic Frontier Foundation and some online news organizations, including CalMatters and Lookout Santa Cruz.

Electronic Frontier Foundation senior legislative analyst Hayley Tsukayama called revitalizing local news “critically important.” But she said her organization opposes the bill because it would benefit large publishers and exclude smaller ones lacking the resources to arbitrate with the platform companies or negotiate special deals the big publishers may be able to obtain.

The EFF also believes that the bill, if enacted, would violate the First Amendment via a provision compelling Big Tech to carry news publishers’ content, Tsukayama said.

But according to California News Publishers Association lawyer Brittney Barsotti, platform companies could continue to moderate content as they see fit. They just could not block or downplay a publisher’s content in retaliation for being asked to pay that publisher. Australia’s law making Big Tech pay for news has given “a substantial boost to newsrooms,” Barsotti said.

Wicks said the extra time to work on the bill will enable changes to address concerns from opponents — even Big Tech.

“We want to make sure we’re getting it right and that it’s a bill that fundamentally allows for publications of all shapes and sizes to participate, publications that have a vested interest in California,” Wicks said. “I welcome Google and Facebook to the table. Come talk to me about the things you have concerns about.”

Source: Orange County Register