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Newspaper publishers support Assembly Bill 323, dubbed “Saving Local Journalism.” The flow of printed news items will change. (File photo by Kevin Sullivan/SCNG)
Industry critics are mounting opposition to a California bill that would pay Big Tech for news articles that help boost its profits, with bipartisan support from a second legislative committee.
Assembly Bill 886, the California Journalism Protection Act by Assemblywoman Buffy Wicks, Democrat of Oakland, was unanimously approved by the Assembly Judiciary Committee on Tuesday, with Riverside Republican Assemblyman Bill Isailly added as a co-author along with Los Angeles Democrat Josh Lowenthal.
“I don’t believe in corporate welfare, I don’t believe in wealth transfer,” Isailly said at a Judiciary Committee hearing Tuesday. But I don’t believe in unjust enrichment. And I think Big Tech is getting unduly rich off the backs of journalists.
The bill comes next for an Assembly floor vote, which, if not yet scheduled, should happen by June 2.
Weeks’ bill follows the passage of the Journalism Competition and Protection Act in Congress in December by U.S. Sens. Amy Klobuchar, Democrat of Minnesota, and John Kennedy, Republican of Louisiana.
Sponsored by the California News Publishers Association, which owns a Bay Area newsgroup, AB 886 would require Internet platforms to use binding arbitration to determine a percentage of ad revenue to compensate news organizations for their content. Australia and Canada have enacted similar laws.
The bill is supported by several print and broadcast news organizations. But in addition to the main targets – Alphabet’s Google and Meta’s Facebook – they are opposed by the ACLU of California, the California Chamber of Commerce, the California Taxpayers Association, the Electronic Frontier Foundation and some online news organizations, including CalMatters.
Meta, Google, Twitter and Yahoo! Matt Schroers, president of the Computer and Communications Industry Association, told the committee that news content from technology companies is subject to US copyright law.
“The question here today is whether a healthy news sector would be better off by linking the internet’s architecture to the subsidization of a few organizations that rely on hyperlinks that illuminate and an unprecedented system of mandatory arbitration,” Schruers said. “Taxes and fees on connectivity enhance the basic architecture of our connected economy and open the door to other fees and taxes on a free and open Internet.”
Similar laws overseas have not worked as intended, Schroers added.
The Chamber of Progress, a politically progressive tech industry advocacy group, said it conducted research showing that its corporate partners, which include Google and Meta, Fox News and “disinformation outlets” benefit the most from such “link taxes.”
Hal Singer, a University of Utah economics professor and expert on antitrust and consumer protection issues, supported the bill, saying the proposal is not a “relationship tax” and that the arbitration provisions are not that unusual. He also pointed out that newsrooms would differ from the proposed federal law requiring 70% of revenue to support journalists.
“The proposed intervention in this law is modest,” Singer told the committee. “News publishers will ask an independent judge, operating under the auspices of the state, to hear their assessment of the annual value of the platform.”
Essaly supported the bill, but said companies like Google, which connects users to websites that display topics they’re interested in, and Facebook, which ranks photos, videos and articles in user newsfeeds, should find a way. Feed based on who their friends are and what they follow. Weeks agreed and thanked Isail for his co-authorship.
“How you put that into law is the question, but I’m determined to figure that out,” Weeks said. “We will continue to engage with the opposition, there will be amendments to this bill, but I want this conversation to continue because I think it’s important to our democracy.”
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