Opinion: A Bill To Prop Up Legacy Media In California Is Bad News For Journalism

By Chris Jennewein, Times of San Diego

April 18, 2023

New California legislation that would force Google, Microsoft and Facebook to pay usage fees for the news articles they index is intended to preserve journalism, but the unintended consequence could be to stifle innovation in local media.

The legislation’s language is confusing, but Assembly Bill 886, titled the California Journalism Preservation Act, would essentially charge fees each month based on a newspaper or TV station’s share of the links clicked on search engines.

How much money this would generate hasn’t been estimated, but the bill would require that 70% go to hiring journalists and “maintaining or enhancing the production and distribution of news or information that concerns local, regional, national, or international matters of public interest.”

There is worthy sentiment behind this effort. Traditional local journalism is clearly under threat across America due to changing economics and a new generation’s preference for the internet and social media over printed newspapers and broadcast television.

As the bill’s preamble states, “Communities without newspapers lose touch with government, business, education, and neighbors…Over the past 10 years, newspaper advertising has decreased 66 percent, and newsroom staff have declined 44 percent.”

But it doesn’t follow that taxing tech companies to aid newspapers and TV stations will improve local news if audiences aren’t reading or watching them.

In fact, there has been an explosion in new digital media enterprises over the past decade. In San Diego alone, Voice of San Diego, Times of San Diego, inewsource, Coronado Times, San Diego Sun, SanDiegoVille and East County Magazine compete with legacy newspapers and TV.

Most of of these would likely benefit in some way, since any California digital publication with over $100,000 in revenue that “performs a public information function comparable to that traditionally served by newspapers” is eligible.

But the problem for digital newcomers is that most of the revenue will go to newspapers and TV stations. They’ve been around the longest, and have the most indexed articles. So every month, the effect of the California Journalism Preservation Act would be to help preserve legacy media.

And what’s to ensure that 70% is actually spent on improving local journalism, or that it will be spent efficiently? That money could end up going right to the bottom lines of the East Coast hedge funds that actually own many of California’s newspapers.

More fundamentally, legislation that seeks to tax up-and-coming parts of the economy to support the old ones, just seems wrong. A century ago, should buggy makers have received a subsidy from the new auto companies? Should Netflix have been forced to support Blockbuster’s rental stores?

Assembly Bill 886 is not especially unique. Similar efforts are underway nationally, and in Europe, such as Minnesota Sen. Amy Klobuchar ‘s Journalism Competition Preservation Act. All of these efforts seek to preserve legacy media outlets as if they alone can provide comprehensive local news coverage.

As a journalist turned media entrepreneur, I appreciate the difficulties that legacy media is experiencing. But the solution isn’t a government-enforced lifeline. The news media, like any other part of the American economy, must sink or swim on its own in the free market.

Chris Jennewein is editor and publisher of Times of San Diego.

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