IE 11 Not Supported

For optimal browsing, we recommend Chrome, Firefox or Safari browsers.

Newsroom Layoffs Renew Call for Big Tech to Pay for Stories

Mass layoffs at the Los Angeles Times are pulling focus back to legislation that would force companies, like Google and Meta, to pay for the news published on their platforms. The bill stalled last year amid stiff opposition.

The Los Angeles Times signage on its headquarters building.
(TNS) — Mass layoffs at the Los Angeles Times on Tuesday and steep cuts at other news organizations are spurring renewed interest in a California bill that would force Google, Facebook and other large platforms to pay journalists.

The bill stalled in the Legislature last year amid stiff opposition from the tech companies it targeted, but its author, Assembly Member Buffy Wicks, plans to try again this year to push it through. The bill is still alive and is a "top priority" for Wicks this year, said Erin Ivie, a spokesperson for the Oakland Democrat.

Los Angeles Times owner Patrick Soon-Shiong advocated for lawmakers to pass such a policy as his paper laid off 115 journalists, representing more than a fifth of its newsroom.

"It's devastating that our lawmakers in the United States have not figured this out yet," Soon-Shiong wrote in a statement. "All we are asking for is the opportunity for our newspaper and hardworking journalists to be fairly compensated, and for the L.A. Times to have a fair chance to become a self-sustaining institution."

Rep. Mark DeSaulnier, D- Antioch, has spearheaded efforts to pass similar legislation at the federal level, as well as a bill to make it easier for newsrooms to operate as nonprofits. He recalled that there were always at least two local reporters around for every Concord City Council meeting when he served as a member, and rows of reporters at the back of the state Senate and Assembly when he was a state lawmaker. Newsrooms have since shrunk considerably, with local government reporters routinely having to cover many large cities and counties at once. Few California papers still employ Sacramento correspondents to cover the state Capitol.

Local newsrooms deter corruption by politicians and are essential to keeping voters informed, DeSaulnier said. But it will be difficult to pass any relief for them in Congress. Though his efforts to help local newsrooms have garnered bipartisan support, they've also won opposition from lawmakers from both parties who have been personally upset about local papers' coverage of their own work, he said. And passing anything at all is a challenge in Washington, given the deeply polarized makeup of Congress.

"There's not an appetite for much of anything in Congress right now, it's so dysfunctional," he said.

Efforts to help local newsrooms have had more success in the California Legislature. In 2022, lawmakers and Gov. Gavin Newsom approved $25 million over five years for local reporting grants administered through the School of Journalism at UC Berkeley.

The first cohort of 40 early career journalists started their two-year fellowships at newsrooms across California in September, including one at the Los Angeles Times. Their work so far has included stories about how lithium mining in the Imperial Valley could affect residents, policing alternatives in Oakland and weapons screening systems in Central Valley schools. The fellows are paid entirely through the state grant, and make $60,000 or $65,000 per year, depending on their education and experience level, project director Christa Scharfenberg said.

The state funding was slated to also cover two additional cohorts of two-year fellows, but Scharfenberg said UC leadership has told her the funding is on the chopping block as Newsom and lawmakers grapple with a major state budget deficit.

Prior to publication, California Department of Finance spokesperson H.D. Palmer confirmed that the funding could be part of $350 million in proposed cuts to "legislative requests" that had not yet been specified by Newsom. After publication, Palmer contacted the Chronicle saying that he had checked with staff in the department who said the governor was not explicitly calling for the funding to be cut. Budget negotiations are ongoing, and the projected deficit — and, by extension, the proposed cuts — could shrink or grow between now and June when the final budget is due.

The San Francisco Chronicle is not currently hosting a fellow through the program, although it has applied to host one in the next round.

Wicks' bill, AB886, passed the Assembly last year but stalled in the Senate Judiciary Committee over the summer. Wicks announced at the time that she and Sen. Tom Umberg, the Santa Ana Democrat who chairs the committee, planned to revive it this year.

"Getting this policy right is more important than getting it quick," Wicks said in a statement at the time. "My priority is making sure this bill does exactly, and only, what it intends: to support our free press and the democracy sustained by it, to make sure publications get paid what they are owed, and to hold our nation's largest and wealthiest tech companies accountable for repurposing content that's not theirs."

Ivie said Tuesday that Wicks and Umberg are actively discussing the bill. It faces a summer deadline to pass and would need to also win approval from Gov. Gavin Newsom to become law.

The bill would make tech companies like Facebook, Google and Microsoft pay a "journalism usage fee" to news organizations. The fees would be calculated as a percentage of ad revenue and would be set based on an arbitration agreement between digital news publishers and large digital platforms.

Supporters of the bill argue that social media platforms benefit financially from news articles posted to their websites, which help them attract and retain visitors. The platforms are not paying the journalists who produce the content, however, effectively starving news organizations of advertising revenue generated by their own work.

The San Francisco Chronicle is among the news organizations that support the bill, along with the California Broadcasters Association, the California News Publishers Association, many other trade and labor organizations representing journalists, and individual news organizations.

Companies targeted by the bill aggressively attacked the bill last year. Facebook's parent company, Meta, threatened to pull news from its platforms if the bill passed. A tech-financed group launched a campaign to kill the bill by pointing out that it would help fund Fox News, a bitter pill in the Democrat-dominated California Legislature.

The Los Angeles Times reported that Google spent $1.2 million on an ad blitz to kill the bill. The company funneled the money through another group, complicating the task of tracking the money.

©2024 the San Francisco Chronicle, Distributed by Tribune Content Agency, LLC.