California to Force Taxpayers and Tech Firms to Fund Journalists
key points about the proposed California Journalism Preservation Act (AB 886):
You probably won't find much opposition to this bill in the local press such as the San Diego Union Tribune. The bill would require large tech platforms like Facebook and Google to pay news organizations when their links are shared on these platforms. The intention is to support struggling local journalism such as the Los Angeles Times, but there are concerns about unintended consequences.
Critics argue it could incentivize the creation of viral, sensationalist content rather than quality local journalism. There's concern that large national outlets, particularly those known for spreading disinformation like Fox News or Washington Post could benefit more than local news organizations.
The bill lacks caps on the size of news organizations that can receive funding, unlike similar federal legislation. The arbitration process in the bill is criticized as one-sided, not allowing platforms to argue the value of the traffic they drive to news sites.
Some alternatives suggested include:
- - Excluding large national outlets or setting size caps for eligible news organizations
- - Requiring eligible outlets to be California-based
- - Implementing fact-checking requirements for eligible content
- - Offering tax rebates for subscriptions to local news outlets instead
There are concerns that the bill could lead to platforms removing news content altogether to avoid payments. The interviewee suggests that direct government subsidies or incentives for local news subscriptions might be more effective in supporting local journalism. The bill is seen as well-intentioned but potentially problematic in its current form, with calls for amendments to address these issues.
California to Force Taxpayers and Tech Firms to Fund Journalists
1. The California Journalism Preservation Act (AB 886) aims to support local journalism by requiring large tech platforms (called "covered platforms") to compensate digital journalism providers for accessing their content.
2. Key points of the legislation:
- Covered platforms (like Google) must either pay a set annual amount to compensate digital journalism providers or participate in arbitration to determine the compensation amount.
- The funding would be distributed to digital journalism providers based on the number of journalists they employ.
- Digital journalism providers must spend at least 70% of the funds received on news journalists and support staff (50% for providers with 5 or fewer employees).
- The legislation aims to provide about $250 million over five years to support California-based news organizations.
3. Impact on journalism funding:
- This would create a new revenue stream for local news organizations, potentially helping to sustain and expand their operations.
- It could help counteract the decline in local journalism jobs and news organizations.
- The funding might enable news organizations to hire more journalists and improve their coverage.
Regarding whether this funding will result in state politicians controlling local journalists:
1. The legislation does not appear to give state politicians direct control over local journalists. The funding mechanism is designed to be administered primarily through tech companies or third-party administrators, not through the state government.
2. The bill includes provisions for transparency and reporting requirements for how the funds are used, which could help prevent misuse.
3. The legislation emphasizes maintaining editorial independence. It doesn't include provisions that would allow state politicians to influence content or editorial decisions.
4. The funds are distributed based on the number of journalists employed, not on the content produced, which helps maintain editorial independence.
5. The bill explicitly states that it does not modify rights pertaining to existing laws or collective bargaining agreements, which could help protect journalists' independence.
How Much Will it Cost
1. Public-Private Partnership: The legislation establishes a public-private partnership to fund journalism in California. This means that both the state and private companies (particularly large tech platforms) will contribute to the funding.
2. Total Funding: The documents mention that the initiatives will provide "nearly $250 million in public and private funding over the next five years, with the majority of funding going to newsrooms."
3. State Contribution: The exact amount that will come from California taxpayers is not explicitly stated. The bill text and accompanying materials do not provide a specific breakdown of how much will come from the state versus private sources.
4. Initial Funding: The goal is to front-load $100 million in the first year to kick-start the efforts.
5. Potential for Increase: The documents state that "The total investment could increase over the next several years if additional funding from private or state sources becomes available."
6. Tech Company Contributions: A significant portion of the funding is expected to come from large tech platforms (referred to as "covered platforms" in the legislation). These companies will either pay a set amount annually or participate in arbitration to determine their contribution.
7. Additional Costs: There may be some additional costs to the state for administration and oversight of the program, but these are not specified in the provided documents.
It's important to note that while the legislation establishes a framework for this funding, the exact amount that will come from taxpayers is not clearly stated in the provided information. The cost to taxpayers could vary depending on how much is contributed by private sources and how the program is implemented.
To get a precise figure on the cost to California taxpayers, you would need additional information or clarification from the bill's sponsors or state budget analysts. The documents suggest that the majority of the funding is expected to come from private sources (particularly tech companies), but the exact proportion is not specified.
Funding for journalists writing stories countering state government policies or politicians:
The legislation does not appear to have any content-based restrictions on funding. The distribution of funds is primarily based on the number of journalists employed, not on the content they produce. Specifically:
- There are no provisions in the bill that exclude funding based on the political stance or content of the journalism.
- The bill emphasizes maintaining editorial independence.
- Section 3273.85 prohibits covered platforms from retaliating against digital journalism providers for asserting their rights under this title.
Therefore, journalists writing stories that counter state government policies or criticize politicians should still be eligible for funding, assuming their employer meets the other criteria for being a digital journalism provider.
Funding for Poor Journalists writing stories that no one reads:
The bill does have some provisions that could potentially address this scenario, though not directly:
- To qualify as a "digital journalism provider," the publication must meet several criteria, including:
- Providing information to an audience in the state and having done so for the prior two years.
- Performing a public information function comparable to traditional newspapers.
- Updating content on at least a weekly basis.
- Having at least 25% of its editorial content consisting of information about current public interest topics.
- Either generating at least $100,000 in annual revenue from editorial content in the previous year, having an International Standard Serial Number, or being a non-profit organization.
- The bill doesn't explicitly require a minimum readership. However, the revenue requirement and the need to provide information to an audience suggest that completely unread content might not qualify.
- The funding is distributed based on the number of journalists employed, not directly on readership. However, a publication consistently producing unread content might struggle to meet the revenue requirement or demonstrate that it's providing information to an audience.
It's worth noting that the bill's focus is on supporting journalism infrastructure rather than directly rewarding readership or engagement. This approach could potentially fund less-read but important investigative or niche journalism. However, a publication hiring journalists solely to game the system without any genuine audience or public service would likely struggle to meet all the qualifying criteria.
The effectiveness of these provisions in preventing abuse while supporting valuable journalism would likely depend on how they are interpreted and enforced in practice.
Extracting the Funds
Based on the information provided in the documents, I can address your questions as follows:
1. Funds from designated AI firms:
The legislation does not specifically target AI firms. Instead, it focuses on "covered platforms," which are defined as online platforms meeting certain criteria:
- At least 50,000,000 United States-based monthly active users or subscribers
- Owned or controlled by a person with either:
a) U.S. net annual sales or market capitalization greater than $550 billion
b) At least 1,000,000,000 worldwide monthly active users
While some AI firms might fall into this category, the legislation is not explicitly limited to or focused on AI companies.
2. Limitation to firms headquartered or operating in California:
The legislation does not appear to be limited to firms headquartered or operating in California. The criteria for "covered platforms" are based on user numbers and company size/value, not location. However, the focus is on compensating digital journalism providers for content accessed for a "California audience."
3. Potential for forcing firms to move out of state:
The legislation doesn't directly address this concern, but there are several points to consider:
- The law applies to platforms accessing content for a "California audience," which suggests that simply moving headquarters out of state might not exempt a company from these requirements.
- The definition of "covered platforms" is based on national or global metrics, not California-specific ones.
- The law provides options for compliance: either paying a set amount or participating in arbitration.
That said, any new regulation can potentially influence business decisions. The impact would likely depend on:
- The final details of the legislation if passed
- The proportion of a company's business that relates to California
- The actual costs incurred under the new system compared to potential costs of relocating
It's worth noting that the documents don't provide specific analysis on potential business relocation impacts. To fully assess this risk, you'd need economic impact studies or feedback from potentially affected companies, which are not included in the provided materials.
Ultimately, while the legislation could create new costs for large tech platforms operating in California, there's no clear indication from these documents that it would necessarily force companies to leave the state. The broad applicability of the law to platforms serving California audiences might actually make it challenging for companies to avoid simply by relocating.
Reaching Out and Touching Them
Based on the information provided in the documents, the legislation doesn't explicitly detail a mechanism for extracting fees from firms outside of California. However, we can infer some potential approaches and challenges:
1. Legal Jurisdiction:
- The bill focuses on platforms that access content for a "California audience," which suggests an attempt to establish jurisdiction over companies serving California residents, regardless of where the company is headquartered.
- This approach is similar to other state laws that aim to regulate out-of-state businesses that have a significant impact within the state (e.g., privacy laws, sales tax for online purchases).
2. Enforcement Mechanisms:
- The bill doesn't specify enforcement mechanisms for out-of-state firms. This could be a significant challenge in implementation.
- Potential enforcement methods (not explicitly stated in the documents) could include:
a) Legal action in California courts
b) Fines or penalties for non-compliance
c) Restrictions on doing business with California-based entities
3. Voluntary Compliance:
- The legislation seems to rely partly on voluntary compliance, offering companies the choice to either pay a set amount or enter arbitration.
- Large tech companies might choose to comply to maintain access to the California market, even if they're based elsewhere.
4. Potential Challenges:
- Interstate Commerce: There could be legal challenges based on the Constitution's Commerce Clause, which gives Congress the power to regulate interstate commerce.
- Practicality of Enforcement: Enforcing such regulations on companies with no physical presence in California could be difficult.
5. Precedents in Other Industries:
- While not mentioned in the documents, California has previously implemented regulations affecting out-of-state entities in areas like emissions standards and privacy laws (e.g., CCPA).
- These could serve as models or precedents for enforcing this new legislation.
6. International Complications:
- For firms based outside the U.S., enforcement could be even more complex and might require international cooperation or agreements.
7. Potential for Federal Involvement:
- If California faces challenges in enforcing this law on out-of-state entities, it might eventually lead to calls for federal legislation to address the issue nationally.
It's important to note that the lack of specific details on this aspect in the provided documents suggests that the exact mechanisms for extracting fees from out-of-state firms might still need to be developed or clarified as the legislation moves forward. The effectiveness of such enforcement would likely depend on further regulatory details, potential legal challenges, and the willingness of platforms to comply to maintain access to the California market.
California Lawmakers Reach Deal with Google Over Support for Journalism - Times of San Diego
California will be the first U.S. state to direct millions of dollars from both taxpayer money and Google and other tech companies to help pay for journalism and AI research under a new deal announced Wednesday.
Under the first-in-the-nation agreement, the state and tech companies would collectively pay roughly $250 million over five years to support California-based news organizations and create an AI research program. The initiatives are set to kick in in 2025 with $100 million the first year, and the majority of the money would go to news organizations, said Democratic Assemblymember Buffy Wicks, who brokered the deal.
“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,” Gov. Gavin Newsom said in a statement. “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.”
Wicks’ office didn’t immediately answer questions about specifics on how much funding would come from the state, which news organizations would be eligible and how much money would go to the AI research program.
The deal effectively marks the end of a yearlong fight between tech giants and lawmakers over Wicks’ proposal to require companies like Google, Facebook and Microsoft to pay a certain percentage of advertising revenue to media companies for linking to their content.
Her Assembly Bill 886, modelled after a legislation in Canada aiming at providing financial help to local news organizations, faced intense backlash from the tech industry, which launched ads over the summer to attack the bill. Google also tried to pressure lawmakers to drop the bill by temporarily removing news websites from some people’s search results in April.
“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 tried different ways to stop the loss of journalism jobs, which have been disappearing rapidly as legacy media companies have struggled to profit in the digital age. More than 2,500 newspapers have closed in the U.S. since 2005, according to Northwestern University’s Medill School of Journalism. California has lost more than 100 news organizations in the past decade, according to Wicks’ office.
The Wednesday agreement is supported by California News Publishers Association, which represents more than 700 news organizations, Google’s corporate parent Alphabet and OpenAI. But unionized journalists, including those in Media Guild of the West, slammed the deal and said it would hurt California news organizations.
State Sen. Steve Glazer, who authored a bill to provide news organizations a tax credit for hiring full-time journalists, said the agreement “seriously undercuts our work toward a long term solution to rescue independent journalism.”
State Senate President Pro Tempore Mike McGuire also said the deal doesn’t go far enough to address the dire situation in California.
“Newsrooms have been hollowed out across this state while tech platforms have seen multi-billion dollar profits,” he 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.”
Assemblymember Wicks secures agreement with State, major tech companies to support the work of California journalists | Official Website
SACRAMENTO – Today, Assemblymember Buffy Wicks announced the establishment of a first-in-the-nation partnership with the State, news publishers, major tech companies and philanthropy, unveiling a pair of multi-year initiatives to provide ongoing financial support to newsrooms across California and launch a National AI Accelerator.
Together, these new partnerships will provide nearly $250 million in public and private funding over the next five years, with the majority of funding going to newsrooms. The goal is to front-load $100 million in the first year to kick-start the efforts. The total investment could increase over the next several years if additional funding from private or state sources becomes available.
“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.”
Assemblymember Wicks authored AB 886 to help ensure the sustainability of local journalism, as news outlets across the country are downsizing and closing at alarming rates. A Northwestern University study published last year found an average of two and a half newspapers in the United States close every week, and that our nation has lost two-thirds of its newspaper journalists since 2005. California has lost more than 100 newspapers in the last decade alone.
The new suite of initiatives includes multi-faceted support for publishers across California to address challenges that have impacted the depth and breadth of news coverage in the state. They will help ensure the sustainability of existing and new online publications – with an emphasis on small, local outlets and community-facing journalism.
“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. “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. This is just the beginning. I remain committed to finding even more ways to support journalism in our state for years to come.”
California news publishers will be the beneficiaries of a News Transformation Fund, to be administered by the UC Berkeley School of Journalism, providing financial resources that preserve and expand California-based journalism. The funding will include contributions from technology platforms and the State of California, supporting innovative new investments that promote local journalism. The funding will support California-based state and local news organizations, particularly those serving California local news deserts, underserved and underrepresented communities, and outlets that prioritize California coverage.
"The University of California is proud to partner with Governor Newsom and legislative leaders to bolster the critical work of local news organizations and journalists in California,” said UC President Michael V. Drake, M.D. “Californians depend on robust local and diverse news organizations to stay informed about their communities, and the University and specifically the UC Berkeley School of Journalism stand ready to support this endeavor.”
Funding for the initiative would be complemented by direct support from the State, helping news organizations keep and grow newsroom staff and offsetting the costs of producing local news and information.
"A vibrant press is crucial for strong communities and a healthy democracy. This is a first step toward what we hope will become a comprehensive program to sustain local news in the long term, and we will push to see it grow in future years," said California News Publishers Association CEO Chuck Champion and Board Chair Julie Makinen. “We will work with the state and tech companies to make the most of this initiative. We're grateful to Assemblymember Wicks for her passionate advocacy on behalf of our 700-plus member newsrooms.”
Partners in this initiative also reiterated their strong commitment to strengthening newsroom and ownership diversity for ethnic and underserved communities. The Governor also announced his support for AB 1511 (Santiago), which aims to increase the state’s ongoing commitment to place official marketing, advertising and/or outreach advertising with local and underrepresented media outlets.
“Ethnic and community media outlets in California have a long history of serving as trusted messengers of culturally responsive news to historically underrepresented and underserved communities,” said Assemblymember Miguel Santiago. “These initiatives ensure that California is embracing private sector innovation while developing partnerships with and seeding investments from the public sector to empower local publishers and journalists that are vital to a healthy, thriving democracy.”
Additionally, 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. This will be administered in collaboration with a private nonprofit, and will provide organizations across industries and communities — from journalism, to the environment, to racial equity and beyond — with financial resources and other support to experiment with AI to assist them in their work. 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.
“We appreciate the thoughtful leadership of Governor Newsom, Assemblymember Wicks, Chair Umberg, and Senator Glazer on these issues,” said Kent Walker, President of Global Affairs and Chief Legal Officer for Alphabet. “California lawmakers have worked with the tech and news sectors to develop a collaborative framework to accelerate AI innovation and support local and national businesses and non-profit organizations. This public-private partnership builds on our long history of working with journalism and the local news ecosystem in our home state, while developing a national center of excellence on AI policy.”
“A strong press is a key pillar of democracy, and we’re proud to be part of this partnership to utilize AI in support of local journalism across California,” said Jason Kwon, Chief Strategy Officer for OpenAI. “This initiative builds on our longstanding work to help newsrooms and journalists around the world leverage AI to improve workflows, better connect users to quality content, and help news organizations shape the future of this emerging technology.”
Work will begin immediately to stand up both initiatives, which will go live in 2025. Included below is a range of quotes from additional supporters.
__________
What others are saying:
“The work of local independent publishers is essential to a well-functioning democracy, and this new public-private partnership provides immediate and needed relief. Lawmakers should be proud of this program, which builds on California’s innovative Local News Fellowship with millions of new dollars in a way that prioritizes small publishers and those serving underrepresented groups.” - Chris Krewson, Executive Director of Local Independent Online News (LION) Publishers, a national nonprofit with 76 of its 600 publisher members in California
"California is leading the way with this first-in-the-nation investment to protect the press and sustain quality journalism. This fund will help news outlets and journalists adapt to a changing landscape with new tools and funding to embrace emerging technologies. This is especially helpful for ethnic and community media which is comprised largely of under-resourced family businesses whose strongest connections are to their community.” - Regina Wilson, Executive Director, California Black Media
"California is home to the largest concentration of multilingual news outlets serving immigrant and ethnic communities in the US. This breakthrough public private partnership to support local journalism brings welcome recognition of the ethnic media sector's indispensable role in connecting these diverse communities to each other and to the wider public realm.” - Sandy Close, Director of Ethnic Media Services (EMS), a California-based nonprofit which works with 2000 ethnic news outlets nationwide, including over 300 in California
“It represents an equity-media model for the nation," added Julian Do, EMS Co-Director
“Protecting and rebuilding California’s robust media ecosystem and ensuring it serves immigrants, Latinos and communities of color equally requires an important role for philanthropy, our tech and private sector, and yes, California's State Government. We see this historic agreement as just the first major step where the State of California can lead the way in building a sustainable media ecosystem for the most diverse state in the Union,” - Arturo Carmona, President of the Latino Media Collaborative
“This is a win for all Californians. Disinformation flourishes when quality journalism disappears. This critical funding will help local publishers survive and keep their communities informed and engaged.” - Neil Chase, CEO of CalMatters and former editor of The Mercury News and East Bay Times
"The new public-private partnership provides a pioneering, ambitious program that will offer significant help to local newsrooms that give Californians the information they need to participate in a healthy democracy. It's encouraging that lawmakers and tech platforms found a way to work together to forge an innovative solution that can be a model for other states." - Lance Knobel, CEO of Cityside Journalism Initiative, the nonprofit behind Oaklandside, Berkeleyside and Richmondside
“The revival of a strong, independent community-minded local press is vital for California. All things considered, this agreement both injects new money into doing that and helps spur the innovation, tech and otherwise, required at this moment. As a companion to the California Local News Fellowship, it’s another brick in the rebuilding of California journalism.” - Ken Doctor, Newsonomics news analyst and Lookout Local founder and CEO
"Supporting local news and journalism is vital to enabling a fully informed and engaged community. We are very pleased to see California as a leader in building this public-private partnership that will substantially impact local journalism and essential news coverage in communities throughout California. This vital funding will support our local news and will enable an expansion of our initiative to add to the depth of our bilingual coverage and journalists in Napa Valley - where 40% of the population is Latinx.” - Marc Hand, CEO and Board Chair of Highway 29 Media, a publisher of newspapers serving communities in Napa Valley
# # #
AB 886: California Journalism Preservation Act.
Existing law generally regulates online platforms, including by requiring, on a semiannual basis and as specified, a social media company to submit to the Attorney General a terms of service report that includes, among other things, the current version of the terms of service of the social media platform.
This bill, the California Journalism Preservation Act, would require a covered platform, as defined, to either pay at least $____ annually to compensate digital journalism providers, as defined, for accessing the internet websites of the providers, providers for a California audience, where the money is annually adjusted, as specified, and annually distributed to digital journalism providers, as described, or to participate in a final arbitration process, as specified, and fully pay the arbitration award, as provided. The bill would require, commencing not later than March 1, 2025, a covered platform to compile and post on its internet website a list of digital journalism providers providers, as described, that the platform accessed for a California audience during the preceding 12 months. The bill would require a covered platform to provide the above-described list to any digital journalism provider upon request, as specified, and to establish a designated email address to which a request may be submitted.
This bill would prohibit a covered platform from retaliating against a digital journalism provider for asserting its rights under the act by refusing to access content or changing the ranking, identification, modification, branding, or placement of the content of the digital journalism provider on the covered platform. The bill would require a digital journalism provider to spend at least 70% of funds received pursuant to the act on news journalists and support staff employed by the digital journalism provider. The bill would require an eligible digital journalism provider with 5 or fewer employees, to spend at least 50% of funds received pursuant to these provisions on news journalists and support staff employed by the digital journalism provider.
This bill would require, no later than one year after the end of an arbitration proceeding or reaching a settlement in lieu of an arbitration proceeding, or receiving a payment, as specified, and each year thereafter, the digital journalism provider to compile a report containing, among other things, an attestation that the digital journalism provider has complied with the revenue sharing provisions described above. The bill would require a digital journalism provider to publish and distribute that report, as specified. By expanding the scope of the crime of perjury, this bill would impose a state-mandated local program. The bill would authorize a digital journalism provider to seek and obtain injunctive relief to compel compliance, as specified, and would require court costs and reasonable attorneys fees to be awarded to a prevailing provider. The bill would state that its provisions are severable.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
AB 886- AMENDED
TITLE 23. Compensation for Journalism Usage
3273.80.
For purposes of this title, the following definitions apply:
(a) “Access” means to acquire, to crawl, or to index content.
(b) “Advertising revenue” means revenue generated through the sale of digital advertising impressions that are served to customers in the state through an online platform, regardless of whether those impressions are served on internet websites or accessed through online or mobile applications.
(c) (1) “Covered platform” means an online platform that at any point during a 12-month period meets both of the following criteria:
(A) The online platform has at least 50,000,000 United States-based monthly active users or subscribers on the online platform.
(B) The online platform is owned or controlled by a person with either of the following:
(i) United States net annual sales or a market capitalization greater than five hundred fifty billion dollars ($550,000,000,000), adjusted annually for inflation on the basis of the Consumer Price Index published by the United States Bureau of Labor Statistics.
(ii) At least 1,000,000,000 worldwide monthly active users on the online platform.
(2) “Covered platform” does not mean either of the following:
(A) An organization exempt from federal income taxation pursuant to Section 501(c)(3) of the Internal Revenue Code of 1986.
(B) A company where at least that earns fewer than 50 percent of its annual revenue, as calculated at the level of the ultimate corporate parent, is from the manufacturing and sales of company-branded devices and hardware
to consumers. from its online platform, advertising, and search services.
(d) “Digital journalism provider” means a publisher or eligible broadcaster that discloses its ownership to the public.
(e) “Eligible broadcaster” means a person that meets all of the following criteria:
(1) The
person holds or operates under a license issued by the Federal
Communications Commission under Subchapter III (commencing with Section
301) of Chapter 5 of Title 47 of the United States Code.
Code, and has held or operated under the license for the prior two years.
(2) The person engages professionals to create, edit, produce, and distribute original content concerning local, regional, national, or international matters of public interest through activities, including conducting interviews, observing current events, analyzing documents and other information, or fact checking through multiple firsthand or secondhand news sources.
(3) The person updates its content on at least a weekly basis.
(4) The person uses an editorial process for error correction and clarification, including a transparent process for reporting errors or complaints to the station.
(f) “News journalist” means a natural person who meets both of the following criteria:
(1) The person is employed for an average of at least 30 hours per week during a calendar quarter by the digital journalism provider.
(2) The person is responsible for gathering, developing, preparing, directing the recording of, producing, collecting, photographing, recording, writing, editing, reporting, designing, presenting, or publishing original news or information that concerns local, regional, national, or international matters of public interest.
(g) “Online platform” means an internet website, online or mobile application, digital assistant, or online service that does both of the following:
(1) Accesses news articles, works of journalism, or other content, or portions thereof, generated, created, produced, or owned by a digital journalism provider.
(2) Aggregates, displays, provides, distributes, or directs users to content described in paragraph (1).
(h) “Publisher” means a person that publishes a qualifying publication.
(i) “Qualified arbitrator” means an arbitration organization that has established arbitration rules and procedures for at least one year prior to the initiation of the arbitration.
(j) “Qualifying publication” means an internet website, online or mobile application, or other digital service that meets all of the following criteria:
(1) The internet website, online or mobile application, or other digital service does not primarily display, provide, distribute, or offer content generated, created, produced, or owned by an eligible broadcaster.
(2) The internet website, online or mobile application, or other digital service provides information to an audience in the state.
state and has done so for the prior two years.
(3) The internet website, online or mobile application, or other digital service performs a public information function comparable to that traditionally served by newspapers and other periodical news publications.
(4) The internet website, online or mobile application, or other digital service engages professionals to create, edit, produce, and distribute original content or original content for which a valid license has been obtained concerning local, regional, national, or international matters of public interest through activities, including conducting interviews, observing current events, analyzing documents and other information, or fact checking through multiple firsthand or secondhand news sources.
(5) The internet website, online or mobile application, or other digital service updates its content on at least a weekly basis.
(6) The internet website, online or mobile application, or other digital service has an editorial process for error correction and clarification, including a transparent process for reporting errors or complaints to the publication.
(7) The internet website, online or mobile application, or other digital service meets any of the following criteria:
(A) The internet website, online or mobile application, or other digital service generated at least one hundred thousand dollars ($100,000) in annual revenue from its editorial content in the previous calendar year.
(B) The internet website, online or mobile application, or other digital service had an International Standard Serial Number assigned to an affiliated periodical before January 1, 2025.
(C) The internet website, online or mobile application, or other digital service is owned or controlled by an organization exempt from federal income taxation pursuant to Section 501(c)(3) of the Internal Revenue Code of 1986.
(8) The internet website, online or mobile application, or other digital service has at least 25 percent of its editorial content consisting of information about topics of current local, regional, national, or international public interest.
(9) The internet website, online or mobile application, or other digital service is not controlled, or wholly or partially owned by, an entity that meets any of the following criteria:
(A) The entity is a foreign power or an agent of a foreign power, as those terms are defined in Section 1801 of Title 50 of the United States Code.
(B) The entity is designated as a foreign terrorist organization pursuant to Section 1189 of Title 8 of the United States Code.
(C) The entity is a terrorist organization, as defined in Section 1182 of Title 8 of the United States Code.
(D) The entity is designated as a specially designated global terrorist organization under federal Executive Order 13224.
(E) The entity is an affiliate of an entity described in subparagraph (A), (B), (C), or (D).
(F) The entity that has been convicted of violating, or attempting to violate, Section 2331, 2332b, or 2339A of Title 18 of the United States Code.
(k) “Representative” means a labor organization designated as the exclusive bargaining representative of news journalists or support staff for the purposes of collective bargaining in accordance with applicable state or federal law.
(l) “Support staff” means a natural person who performs nonexecutive functions, including payroll, human resources, fundraising and grant support, advertising and sales, community events and partnerships, technical support, sanitation, and security.
3273.81.
A covered platform shall do either of the following:
(a) Pay
at least ____ dollars ($____) annually to compensate digital journalism
providers for accessing the internet websites of the providers, providers for a California audience,
where those amounts are annually adjusted for increases in the Consumer
Price Index and annually distributed to digital journalism providers as
follows:
(1) No less than 1 percent of this amount shall be paid to digital journalism providers that would receive less than twenty-five thousand dollars ($25,000) pursuant to paragraph (2) to be distributed annually proportionally by the number of news journalists and, subject to subparagraph (B) of paragraph (2) of subdivision (a) of Section 3273.86, freelancers who, in the previous calendar year, were employed by each qualifying publication for the primary purpose of producing content for a California audience among those digital journalism providers, in addition to the amount those providers would receive pursuant to paragraph (2).
(2) Proportionally by the number of news journalists and, subject to subparagraph (B) of paragraph (2) of subdivision (a) of Section 3273.86, freelancers, who, in the previous calendar year, were employed by each qualifying publication for the primary purpose of producing content for a California audience.
(b) Participate in a final arbitration process under Section 3273.84 and fully pay the arbitration award, if any, to the administrator engaged pursuant to subdivision (a) of Section 3273.82 within 30 days of the award, or to each participating digital journalism provider within 90 days of the award.
3273.82.
(a) A covered platform shall make distributions pursuant to Section 3273.81 by doing either of the following:
(1) Engaging an approved claims administrator to administer the distributions. distribute the annual payments to digital journalism providers.
(A) In selecting an approved claims administrator the covered platform shall ensure that the administrator is well qualified to perform the distribution and has administered multiple settlements in the State of California that comply with complex civil litigation class action settlement guidelines in at least three state or federal courts in California.
(B) The cost of the claims administrator shall be in addition to the amount specified in Section 3273.81.
(2) Distributing the annual payments to digital journalism providers itself, the costs of which shall be in addition to the amount specified in Section 3273.81.
(b) An administrator distributing payments pursuant to paragraph (1) of subdivision (a) or a covered platform distributing payments pursuant to paragraph (2) of subdivision (a) shall do all of the following:
(1) Prepare an annual statement of account related to the distribution activities, certified by a certified public accountant.
(2) Identify a point of contact for digital journalism provider inquiries with timely redress.
(3) Establish policies to resolve disputes, guard against fraud and abuse, and ensure that any undistributable funds are reallocated among participating digital journalism providers after a reasonable holding period pursuant to Section 3273.81.
(4) Publish on its internet website and the covered platform’s internet website
an annual report detailing
nonconfidential operations of the fund, including the digital
journalism providers that received compensation and the amount paid.
If the covered platform has engaged a claims administrator to
distribute the payments, the administrator shall provide the report to
the covered platform and the covered platform shall also publish the
report on its internet website.
(c) (1) On or before April 1, 2025, a covered platform shall identify a point of contact for email or other electronically communicated digital journalism provider inquiries.
(2) Digital (A) A digital journalism providers provider that want wishes to receive payments an annual payment pursuant to subdivision (a) of Section 3273.81 shall submit notice to the point of contact by May 1, 2025.
(B) The notice shall include, at a minimum, the name of the digital journalism provider, the number of eligible journalists employed or claimed pursuant to Section 3273.86, and a contact person for the publication.
(C) The covered platform may institute reasonable measures to verify that the notice was sent by an actual representative of the publication.
(d)(1)A
digital journalism provider who, after utilizing in good faith the
dispute resolution process established pursuant to paragraph (3) of
subdivision (b), is aggrieved by the decision of the payment distributor
may initiate an arbitration of the dispute by a qualified arbitrator.
(2)In an arbitration pursuant to paragraph (1), the payment distributor shall pay the cost of the qualified arbitrator.
(e)
(d) A covered platform distributing payments pursuant to paragraph (2) of subdivision (a) shall retain a qualified auditor to examine relevant books and records with respect to the distributions as part of an annual audit.
(f)
(e) A final arbitration award under Section 3273.84 to a jointly participating group of digital journalism providers shall be distributed proportionally by the number of news journalists and, subject to subparagraph (B) of paragraph (2) of subdivision (a) of Section 3273.86, freelancers, who, in the previous calendar year, were employed by each participating provider for the primary purpose of producing content for a California audience.
(g)Any
(f) The amount of any
compensation received by a digital journalism provider through a
commercial agreement for access to content by the covered platform prior to commencement of arbitration or payment by a covered platform pursuant to subdivision (a) of Section 3273.81
that was offset pursuant to subparagraph (C) of paragraph (3) of subdivision (g) of Section 3273.84 shall be deducted from its allocation accordingly.
(g) (1) A digital journalism provider that disagrees with the determination of their eligibility or the amount of compensation awarded may seek a review of the determination as follows:
(A) (i) If the covered platform has retained a claims administrator, the digital journalism provider shall seek redress through the dispute resolution process established pursuant to paragraph (3) of subdivision (b).
(ii) If the digital journalism provider disagrees with the result of the dispute resolution process, the digital journalism provider may initiate an arbitration of the dispute by a qualified arbitrator.
(B) If the covered platform has not retained a claims administrator, the digital journalism provider may initiate an arbitration of the dispute by a qualified arbitrator.
(2) Any challenge pursuant to paragraph (1) shall be made within 10 days of receiving notice of the eligibility decision or compensation determination to be challenged.
(3) In an arbitration pursuant to paragraph (1), the claims administrator or covered platform, as applicable, shall pay the cost of the qualified arbitrator.
(h) A digital journalism provider shall not be denied compensation under this section on the basis that the provider publishes or broadcasts, in whole or in part, in a language other than English.
3273.83.
(a) Commencing no later than March 1, 2025, a covered platform shall compile and post on its internet website a list of digital journalism providers that the platform accessed for a California audience during the preceding 12 months.
(b) A covered platform shall provide that list to any digital journalism provider upon request within three days after the request is submitted and shall establish a designated email address to which a request may be submitted.
(c) A digital journalism provider shall not be excluded from the list or the arbitration under Section 3273.84 on the basis that the provider publishes or broadcasts, in whole or in part, in a language other than English.
3273.84.
(a) (1) In an arbitration initiated pursuant to subdivision (b) of Section 3273.81, the arbitrator shall solely determine the percentage of the covered platform’s advertising revenue to be remitted to participating digital journalism providers on an annual basis pursuant to this section. Digital
(2) Digital journalism providers shall jointly participate in the a final offer arbitration process with a covered platform described in this section with each covered platform
to determine a single percentage of the covered platform’s advertising
revenue from which the distributions described in subdivision (f)
(e) of Section 3273.82 will be allotted. Covered platforms shall not participate jointly in a final offer arbitration process.
(2)
(3) Within
30 days after a covered platform posts the list of digital journalism
providers pursuant to subdivision (a) of Section 3273.83, by a majority
vote, participating digital journalism providers shall establish rules
and procedures to govern decisionmaking regarding the arbitration
proposal or any settlement reached pursuant to
subdivision (c) and each eligible digital journalism provider shall be entitled to one vote on any matter submitted to a vote of the members.
(3)
(4) The covered platform or digital journalism providers may initiate a final offer arbitration with a qualified arbitrator for an arbitration panel to determine the percentage of the covered platform’s advertising revenue remitted to the participating digital journalism providers.
(b) Nothing in this section shall be interpreted as preventing a digital journalism provider from being individually represented in the joint arbitration process in subdivision (a).
(c) Prior to the commencement of the final offer arbitration, there shall be 60 days of mediation between the covered platforms and digital journalism providers to reach a settlement. If no agreement is reached, the final offer arbitration shall commence 10 days after the conclusion of the mediation period. If an agreement is reached through mediation, the arbitrator may approve the agreement, in which case the group will not proceed to arbitration.
(d) The arbitration procedure authorized by this section shall be decided by a panel of three arbitrators affiliated with the qualified arbitrator under the rules of the arbitrator except to the extent they conflict with this section.
(e) The covered platform and the digital journalism
providers shall each pay one-half of the cost of administering the
arbitration proceeding, including arbitrator compensation, expenses, and
administrative fees. The costs for the digital journalism providers
shall be deducted from the amount awarded before the calculation in
subdivision (f) (e) of Section 3273.82.
(f) During a final offer arbitration proceeding under this section, all of the following shall apply:
(1) (A) (i) Digital journalism providers and the covered platform may demand the production of business records that are relevant to the single percentage of a covered platform’s advertising revenue to be awarded to participating digital journalism providers and that are nonprivileged, reasonably necessary, and reasonably accessible without undue expense.
(ii) For A covered platform seeking the production of business records of a digital journalism providers
provider that qualify
qualifies for a distribution pursuant to subparagraph (A) of
paragraph (1) of subdivision (a) of Section 3273.81, documents and information requested
shall be limited to one request for documents and information and the
covered platform requesting the information shall, within 10 days,
reimburse the provider for the reasonable costs of production, including attorneys’ reasonable attorney’s fees.
(B) Documents and information described in subparagraph (A) shall be exchanged not later than 30 days after the date the demand is filed.
(2) Digital journalism providers
and the covered platform shall each submit a final offer
proposal for the remuneration that the digital journalism providers
should receive receive, on an annual basis, from the covered platform for access to the internet websites or other digital services of the digital journalism providers during the period under arbitration for an audience in California
based on the value that access provides to the platform. The final
offer proposals shall include backup materials sufficient to permit the
other party to replicate the proffered valuation.
(3) A final offer proposal pursuant to this section shall not address whether or how the covered platform or any digital journalism provider displays, ranks, distributes, suppresses, promotes, throttles, labels, filters, or curates the content of the digital journalism providers or any other person.
(g) (1) Not later than 60 days after the date arbitration
proceedings begin pursuant to subdivision (c), the arbitration panel
shall determine the percentage of
the covered platform’s advertising revenue
to be remitted
by the covered platform to the participating digital journalism
providers from a final offer from one of the parties without
modification. which of the
parties’ final offer proposals to accept pursuant to paragraph (2) of
subdivision (f). The arbitration panel shall accept one of the two
offers without modification.
(2) In making a determination pursuant to paragraph (1), the arbitration panel shall do all of the following:
(A) Refrain
from considering any value conferred upon any digital journalism
provider by the covered platform for distributing or aggregating its content
content, other than monetary compensation agreed to by the
digital journalism provider in a written commercial agreement with the
platform, as an offset to the value created by that digital
journalism provider, unless the covered platform does not automatically
access and extract information from a digital journalism provider’s
internet website.
(B) Consider past incremental revenue contributions as a guide to the future incremental revenue contribution by any digital journalism provider.
(C) Consider the pricing, terms, and conditions of any available, comparable commercial agreements between parties granting access to digital content, including pricing, terms, and conditions relating to price, duration, territory, and the value of data generated directly or indirectly by the content accounting for any material disparities in negotiating power between the parties to those commercial agreements.
(D) If submitted with a final offer proposal, consider the digital journalism provider’s previous compliance with Section 3273.86, if applicable.
(E) Issue a standard binding arbitration award of the percentage of the covered platform’s advertising revenue remitted to participating digital journalism providers.
(3) Within 15 days of accepting a final offer proposal, the arbitration panel shall issue an order setting forth the final amount that the covered platform pay on an annual basis pursuant to Section 6273.81. The order shall do all of the following:
(A) Set forth the amount of the final offer accepted by the arbitration panel.
(B) Require the covered platform to pay the final offer amount on an annual basis.
(C) (i) If applicable, authorize the covered platform to reduce the total payment by the total amount of all commercial agreements the covered platform has with any participating digital journalism provider that participated in the arbitration for the covered period.
(ii) To receive an offset under this subparagraph, the covered platform shall provide to the arbitration panel copies of all of the commercial agreements for which it seeks an offset.
(iii) The platform may offset its annual payment for a payment made pursuant to a commercial agreement only by the amount actually paid under that agreement each year.
(D) The date of the order.
(3)
(4) Any
party to the arbitration proceeding may elect to appeal the decision of
the arbitration panel pursuant to Section 3273.88 on the grounds of a procedural irregularity. any ground permitted under subsection (a) of Section
10 of Title 9 of the United States Code.
(h) If the covered platform and digital journalism providers reach a settlement in lieu of arbitration, the settlement shall not waive the digital journalism provider’s obligations pursuant to Section 3273.86.
(i) No less than 1 percent of each arbitration award shall be paid to digital journalism providers that would receive less than twenty-five thousand dollars ($25,000), to be distributed annually proportionally by the number of news journalists and, subject to subparagraph (B) of paragraph (2) of subdivision (a) of Section 3273.86, freelancers who, in the previous calendar year, were employed by each qualifying publication for the primary purpose of producing content for a California audience among those digital journalism providers, in addition to the amount those providers would receive pursuant to paragraph (1) of subdivision (g).
(j) No fewer than 24 months after the end of an arbitration proceeding, any (1) Any party to the proceeding may elect to reinitiate the arbitration process. process on a date no fewer than 24 months from the date of the order in paragraph (3) of subdivision (g).
(2) The order shall remain in effect until the issuance of a superseding order.
3273.85.
(a) A covered platform shall not retaliate against a digital journalism provider for asserting its rights under this title by refusing to access content or changing the ranking, identification, modification, branding, or placement of the content of the digital journalism provider on the covered platform.
(b) A digital journalism provider that is retaliated against may bring a civil action against the covered platform.
(c) This section does not prohibit a covered platform from, and does not impose liability on a covered platform for, enforcing its terms of service against a journalism provider.
3273.86.
(a) (1) Except as provided in paragraph (2), a digital journalism provider shall spend at least 70 percent of funds received pursuant to this title on news journalists and support staff employed by the digital journalism provider.
(2) (A) A digital journalism provider with five or fewer employees shall spend at least 50 percent of funds received pursuant to this title on news journalists and support staff employed by the digital journalism provider.
(B) For the purpose of calculating an allocation from a covered platform pursuant to subdivision (a) of Section 3273.81
and subdivision (f) (e)
of Section 3273.82, or for establishing a digital journalism provider’s
minimum allocation to news journalists and support staff pursuant to
this section, a digital journalism provider with five or fewer employees
may elect to count dollars spent on the equivalent functions performed
by news journalists as follows:
(i) The digital journalism provider shall employ at least one news journalist for the primary purpose of producing content for a California audience.
(ii) Each forty thousand dollars ($40,000) spent by a digital journalism provider in the previous calendar year to compensate other natural persons performing the functions defined by paragraph (2) of subdivision (f) of Section 3273.80 may claim to employ the equivalent of one news journalist, up to a maximum of one hundred sixty thousand dollars ($160,000) or the equivalent of four news journalists, with those amounts subsequently annually adjusted for increases in the Consumer Price Index. In no instance may the total number of news journalists and their equivalents claimed pursuant to this clause exceed the number of natural persons compensated by the digital journalism provider.
(b) No later than 30 days after the end of an arbitration proceeding described in Section 3273.84, reaching a settlement in lieu of an arbitration proceeding, or receiving a payment pursuant to subdivision (a) of Section 3273.81, the digital journalism provider shall provide notification in writing of its plan to comply with subdivision (a) to the news journalists and support staff employed by the digital journalism provider and any representatives of those news journalists or support staff.
(c) The digital journalism provider’s plan to comply with subdivision (a) shall include a good faith estimate of the number of news journalists and support staff, respectively, if any, expected to be hired, details regarding proposed compensation adjustments, if any, and a disclosure if either hiring or compensation adjustments are not expected.
3273.87.
(a) No later than one year after the end of an arbitration proceeding described in Section 3273.84, or reaching a settlement in lieu of an arbitration proceeding, or receiving a payment pursuant to subdivision (a) of Section 3273.81, and each year thereafter, the digital journalism provider shall compile a report that includes all of the following:
(1) An attestation as to whether the digital journalism provider has complied with subdivision (a) of Section 3273.86.
(2) The text of the digital journalism provider’s plan to comply with subdivision (a) of Section 3273.86.
(3) The total number of payments under this title received from covered platforms.
(4) The name of each covered platform paying the digital journalism provider a payment under this title and a description of how the digital journalism provider spent the payment, including any amount of payments under this title remaining unspent.
(5) The total number of news journalists and support staff respectively staff, respectively, employed by the digital journalism provider, including the number of news journalists and support staff hired or terminated respectively terminated, respectively, during the previous year.
(b) No later than one year after the end of an arbitration proceeding described in Section 3273.84 or reaching a settlement in lieu of an arbitration proceeding, or receiving a payment pursuant to subdivision (a) of Section 3273.81, and each year thereafter, the digital journalism provider shall publish a copy of the report described in subdivision (a) online in a text-searchable format and provide a copy to the news journalists and support staff employed by the digital journalism provider, any representatives of those news journalists or support staff, and the covered platforms making payments under this title to the digital journalism provider.
(c) If a digital journalism provider fails to comply with this section, a covered platform may withhold payments under this title until the digital journalism provider has provided a copy of the report to the covered platform and has published a copy of the report online pursuant to subdivision (b).
3273.88.
(a) Nothing in this title shall be construed as amending or repealing the ability of a digital journalism provider or a covered platform to avail themselves of Section 526 of the Code of Civil Procedure or any other existing remedy at law.
(b) A digital journalism provider may seek and obtain injunctive relief to compel compliance with this section, title, and court costs and reasonable attorney’s
fees shall be awarded to a prevailing provider.
3273.89.
(a) This title does not modify, impair, expand, or in any way alter rights pertaining to Title 17 of the United States Code or the Lanham Act (15 U.S.C. 1051 et seq.).
(b) This title does not abridge or impair rights otherwise reserved by news journalists, support staff, or their representatives according to applicable law or existing collective bargaining agreements.
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