California strikes a first-of-its-kind deal with tech companies to allocate $250 million over five years for journalism support and AI research, sparking mixed reactions among lawmakers and journalists.
Bollywood Fever: California is set to become the first U.S. state to channel millions of dollars in taxpayer money and contributions from tech companies into supporting journalism and advancing AI research.
The groundbreaking agreement, announced on Wednesday, will see roughly $250 million directed towards California-based news organizations and the creation of an AI research program over the next five years.
Under the terms of the agreement, $100 million will be allocated in the first year, with the majority of funds directed towards bolstering local journalism.
The initiative is slated to begin in 2025 and aims to provide much-needed financial support to struggling newsrooms across the state.
Democratic Assemblymember Buffy Wicks, who played a key role in negotiating the deal, emphasized its significance in preserving local journalism.
“This agreement represents 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,” said Governor Gavin Newsom.
“The deal not only provides funding to support hundreds of new journalists but helps rebuild a robust and dynamic California press corps for years to come, reinforcing the vital role of journalism in our democracy.”
However, specific details about the funding breakdown, including the amount the state will contribute, the news organizations eligible for support, and the allocation to the AI research program, were not immediately available from Wicks’ office.
The deal concludes a yearlong battle between California lawmakers and tech giants like Google, Facebook, and Microsoft.
Wicks had initially proposed legislation that would require these companies to pay a percentage of their advertising revenue to media companies for linking to their content.
The proposal, modeled after similar legislation in Canada, faced significant resistance from the tech industry, which launched a public campaign against it, including temporarily removing news websites from some search results.
“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 said in a statement. “This is just the beginning.”
California has been grappling with the rapid loss of journalism jobs as legacy media companies struggle to adapt to the digital age.
According to Northwestern University’s Medill School of Journalism, over 2,500 newspapers have closed in the U.S. since 2005. In California alone, more than 100 news organizations have shut down in the past decade.
The agreement has garnered support from the California News Publishers Association, Google’s parent company Alphabet, and OpenAI.
However, not everyone is on board. Some journalists, including those from the Media Guild of the West, have criticized the deal, arguing that it could ultimately harm California news organizations.
State Senator Steve Glazer, who authored a bill to provide tax credits to news organizations for hiring full-time journalists, expressed concerns that the agreement undermines efforts to find a long-term solution for independent journalism.
Senate President Pro Tempore Mike McGuire echoed these concerns, stating that the deal falls short of addressing the financial challenges facing California’s news industry.
“Newsrooms have been hollowed out across this state while tech platforms have seen multi-billion dollar profits,” McGuire said in a statement.
“We have concerns that this proposal lacks sufficient funding for newspapers and local media, and doesn’t fully address the inequities facing the industry.”
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