Big Tech Bargain: Google, California Agreement Commits $250 Million To Journalism, AI Initiatives — But At What Cost?

The Magazine Manager blog has followed California’s journalism bill since it was introduced last March as a measure to force Big Tech companies to pay a usage fee to publishers for their local-based content. In the contentious months since, the California Journalism Preservation Act (CJPA; AB-886) has seen threats by one tech company to remove news from feeds, delays in legislation, similar efforts by other states, the actual removal of news by another tech company, and, most recently, a successful passing by the state’s Senate Appropriations Committee earlier this month.

Last week, an agreement was reached between the state and Google, who will commit a combined $250 million to California newsrooms over the next five years for journalism initiatives and AI development.

“As technology and innovation advance, it is critical that California continues to champion the vital role of journalism in our democracy,” said Assemblymember Buffy Wicks, who originally authored the bill. “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.”

Wicks told Politico that the AI aspect of the deal was a small part of the negotiation that will ultimately support not only journalism, but other organizations, industries, and communities from “the environment … racial equity and beyond.”

“Researchers and businesses will have access to new resources to explore the use of AI to tackle some of the most complex challenges facing society, and strengthen the workforce through a new National AI Innovation Accelerator,” Wicks says. “The AI accelerator will empower organizations with the new technology, and complement the work of the Journalism Fund by creating new tools to help journalists access and analyze public information.”

Even with Google paying $170+ million over the course of the deal, many feel like the tech company got off easy, from California state Senate leader Mike McGuire (the deal “doesn’t fully address the inequities facing the industry”) to Media Guild of the West President Matt Pearce (“This isn’t regulation. It’s a ratification of Google’s monopoly power over our newsrooms”). With this agreement, Wicks says, funds can reach publishers without the need for legislation that could take years to resolve. 

“If you look at Canada,” Wicks told Politico, “they passed that over a year ago, and publishers haven’t received a penny from that yet.”

In a statement praising Wicks efforts, News/Media Alliance President and CEO Danielle Coffey added that the organization will continue working on the federal Journalism Competition & Preservation Act (JCPA), which passed the Senate Judiciary Committee last summer. 

“Google is a dominant monopoly that reaps significant revenue off scraping and repackaging quality news content, depriving publishers of the opportunity to monetize their content and reinvest in journalists,” says Coffey. “[This] announcement reinforces the need for federal legislation and potential court remedies to address this broken marketplace.”