Google Agrees To Fund California Newsrooms

If the reports are true that Google struck a first-in-the-nation deal with California lawmakers last 21 August to fund newsrooms in the state, then this could end proposed legislation that would have forced technology giants to pay for the right to distribute news content. Whether it has been finalized or not, the agreement was immediately met with fierce criticism from journalist unions, who called the deal "disastrous."

The plan calls for a US$ 250 million commitment over five years from Google and the state, a majority of which would fund California newsrooms, and launch an artificial intelligence "accelerator" designed to support journalists’ work.

Under the proposed partnership, Google will contribute up to US$ 15 million into a journalism fund in the first year, while the state of California will invest US$ 30 million. During the four subsequent years, California’s contribution will drop to US$ 10 million per year, while Google’s will contribute a minimum of US$ 20 million to the fund and existing journalism programs.

The deal shelves a high-profile bill, dubbed the "California Journalism Preservation Act", that would have forced technology companies, including Google (GOOGL) and Meta (META), to pay news companies to distribute their content online.

The bill, sponsored by state assemblymember Buffy Wicks, was modeled after similar laws implemented in Australia and Canada, providing funding to local news organizations that have seen their business models collapse amid the rise of big tech platforms.

"As technology and innovation advance, it is critical that California continues to champion the vital role of journalism in our democracy," Wicks said in a statement announcing the deal with Google. "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. This is just the beginning. I remain committed to finding even more ways to support journalism in our state for years to come."

California Gov. Gavin Newsom, who had not publicly weighed in on the bill, also hailed the deal, calling it "a major breakthrough in ensuring the survival of newsrooms and bolstering local journalism across California — leveraging substantial tech industry resources without imposing new taxes on Californians."

News publishers have struggled mightily in recent years, shedding thousands of jobs and prompting the closure of some outlets altogether as advertising dollars and audiences have rapidly shifted away from traditional publications.

Ironically, the deal announced Wednesday also championed a so-called "National AI Innovation Accelerator," adding funding for developing artificial intelligence, which some journalist groups have warned pose a danger to the future of their industry and threatens to further stir distrust in news reporting.