Google and California strike controversial news funding deal

One representative body of journalists in California criticised the funding deal’s AI focus and said it is ‘left almost without words’.

Lawmakers in California have struck a deal that will see the tech companies such as Google pay millions of dollars to newsrooms across the state, including a controversial provision for AI.

According to Politico, the first-of-its-kind deal will see Google and the state of California jointly contribute around $250m to support local newsrooms over five years through the so-called News Transformation Fund housed at University of California, Berkeley.

Google will pay $110m for journalism initiatives while the state will chip in another $70m, the outlet reports, adding that an additional $70m in private funding will go towards the development of AI tools through a to-be-established nonprofit.

Buffy Wicks, an Oakland democrat who led negotiations on the deal, said it is critical that the state champions the role of journalism in democracy. “This partnership represents a cross-sector commitment to supporting a free and vibrant press, empowering local news outlets up and down the state to continue in their essential work.”

‘Too inadequate’

While some have praised the deal and said it’s a sign that California is leading the way, others felt the deal does not go far enough. Media Guild of the West, which represents journalists and news workers in California, expressed its disappointment at the latest deal, stating that after two years of advocacy for strong anti-monopoly action, “we are left almost without words”.

“The publishers who claim to represent our industry are celebrating an opaque deal involving taxpayer funds, a vague AI accelerator project that could very well destroy journalism jobs, and minimal financial commitments from Google to return the wealth this monopoly has stolen from our newsrooms.”

Meanwhile, Jessica J Gonzàlez, co-CEO of US-based media advocacy group Free Press, said that while some newsrooms will benefit from this deal in the short term, “the funding is far too meagre, the time span far too short, the commitment to localism and diversity far too inadequate”.

“Good policy is made out in the open, where people can see and participate in the democratic process. This deal, meanwhile, was hammered out behind closed doors between media giants and tech platforms. While we’re awaiting final details, it seems clear that the result is an agreement that fails to meet the needs of California’s journalists and communities,” she said.

Changes further afield

Last November, Google and Canada reached a deal that narrowly avoided shutting down online news from the country from appearing on the platform, after the search giant agreed to pay millions to news outlets in the country.

Pascale St-Onge, minister of Canadian heritage, said at the time that the government of Canada and Google “found a path forward” for the implementation of the Online News Act, also known as C-18, that requires Big Tech to pay for news published on its platforms.

“This will benefit the news sector and allow Google to continue to play an important role in giving Canadians access to reliable news content,” she said.

As per the deal, Google would contribute a total of CAD$100m in “financial support” to news businesses across Canada, including independent outlets and those from indigenous and official minority communities. The amount will be indexed to inflation.

This came after Google joined Meta in refusing to pay news organisations for their content earlier this year after the Online News Act passed by the Canadian parliament last June.

Asking big tech platforms to pay for news is gaining momentum the world over. Inspired by similar moves in Australia and Canada, Malaysia became one of the latest countries to consider legislation last September that will require the likes of Google and Meta to compensate news outlets.

Australia became a pioneer in this space two years ago when it passed the News Media Bargaining Code, requiring Meta (then Facebook) and Google to strike commercial deals with news outlets for using their content.

In the immediate aftermath of the law, Facebook blocked Australian news media content from appearing on its platform overnight, before eventually finding middle ground.

Find out how emerging tech trends are transforming tomorrow with our new podcast, Future Human: The Series. Listen now on Spotify, on Apple or wherever you get your podcasts.