Journalists’ Union: California Should Renegotiate State’s Newsroom Funding Deal With Google

The Media Guild of the West is calling for an overhaul of last year’s agreement with Google to fund California newsrooms.

The $250 million deal reached in August promised to provide funding over the next five years to newsrooms and launch a “National AI Innovation Accelerator.” The accelerator would have supplied financial resources “and other support” to enable newsrooms to experiment with AI to bolster their work.

However, in a letter addressed to Gov. Gavin Newsom and legislative leaders, the union representing local journalists in Southern California, Arizona and Texas explained that it sees the upcoming budget process as an opportunity to rework the first-of-its-kind settlement.

Union President Matt Pearce wrote that the “meager” contributions of the deal will not be enough to “correct” the market and stimulate job growth across California’s collapsing news sector.

“Our guild believes the draft settlement cannot achieve Governor Newsom’s stated aim of creating a program that ‘helps rebuild a robust and dynamic California press corps for years to come, reinforcing the vital role of journalism in our democracy,’” Pearce wrote.

The agreement tabled the California Journalism Preservation Act, a bill Google fiercely objected to. The bill from Assemblymember Buffy Wicks, D-Oakland, would have forced large tech platforms to pay California newsrooms a portion of their online advertising revenues in exchange for using their content.

The deal also shelved a bill by state Sen. Steve Glazer, D-Orinda, that would have levied a 7.25% tax on digital advertising revenue to create a tax credit for newsrooms.

Pearce told KQED he is also concerned about the public funding provisions in the agreement.

“There’s a real risk of news publishers in California doing unsavory things that would make their own journalists uncomfortable if we create a system where [news publishers are] incentivized to hire lobbyists instead of hiring more reporters to go back to the Legislature and ask for more money,” Pearce said. “We need a law, not lobbying mayhem.”

Pearce supports a different funding model, similar to stricter laws passed in Canada and Australia that apply to more tech companies than just Google.

The Media Guild of the West proposed six recommendations to improve the settlement, including imposing a contribution incentive encouraging multiple Big Tech companies to donate to the Journalism Fund instead of relying on public dollars; requiring fair-labor standards for public funds allocated to large, corporate-owned news employers via the Journalism Fund; and removing California and the Journalism Fund from involvement with Google’s National AI Accelerator.

“These companies, whether through banning hyperlinks or degrading them on their services — which almost all platforms are doing now — to using generative AI to create their own content … they’re still extracting and benefiting from journalism,” Pearce said. “The old rules of copyright don’t quite make sense in this new era of AI-powered factory farming.

“There need to be compensation systems set up because somebody’s doing the work, whether you realize it or not, and these companies are just free-riding.”

The governor’s office and Google did not respond to KQED’s request for comment. However, in a press conference on Monday, Newsom said details about the current deal would be unveiled Friday.