Meta Threatens to Block News if California Passes Journalism Bill

California aims to preserve journalism and Meta is mad

According to a Meta spokesman, Facebook and Instagram will block news articles in California if state lawmakers pass a proposed bill, the California Journalism Preservation Act.

As described by NPR, the proposed bill aims to tax advertising profits that platforms like Facebook and Instagram make from the distribution of news articles and content. The California Journalism Preservation Act wants to use around 70 percent of this new tax revenue, which the state describes as a “usage fee,” to support newsrooms throughout California.

“As news consumption has moved online, community news outlets have been downsized and closing at an alarming rate,” says the bill’s sponsor, Assemblywoman Buffy Wicks, a Democrat representing Oakland in California’s state legislature. At a hearing on the legislation, Wicks noted that over 100 California news organizations have succumbed to economic pressures in the past 10 years.

Meta’s Response

Meta says that the legislation won’t accomplish its goals and will instead help out-of-state publishers. If the bill passes, Meta says it’ll just block all news articles from users in California.

“If the Journalism Preservation Act passes, we will be forced to remove news from Facebook and Instagram, rather than pay into a slush fund that primarily benefits big, out-of-state media companies under the guise of aiding California publishers,” says Andy Stone, spokesperson for Meta.

Stone continues, “The bill fails to recognize that publishers and broadcasters put their content on our platform themselves and that substantial consolidation in California’s local news industry came over 15 years ago, well before Facebook was widely used. It is disappointing that California lawmakers appear to be prioritizing the best interests of national and international media companies over their own constituents.”

While Meta claims its hand is being forced, Danielle Coffey, executive vice president of the News Media Alliance trade group, isn’t so sure. “Meta’s threat to take down news is undemocratic and unbecoming. We have seen [this] in their playbook before,” Coffey says.

Meta has Shown Bite Behind its Bark

Although impossible to say with certainty, if Meta stopped showing news to customers in California, it wouldn’t be the first time the company had followed through on a threat to stop serving news to customers in response to a law.

As NPR reports, Facebook briefly blocked news articles for Australian users following a law requiring tech companies to pay publishers for news content. Google was poised to behave similarly before Australia, and the tech giants came to a compromise.

When American legislators pitched plans to help news outlets negotiate directly with tech companies, Meta said, “Not so fast,” and said it might remove all news from Facebook. It’s the tech giant equivalent of, “taking my ball and going home.”

Social Media Companies and the Ad Revenue Pie

It’s fair to ask, “What does it matter if companies like Meta and Google take a big piece of the advertising revenue pie?”

As Assemblywoman Wicks said, news outlets are suffering, and she, and others, think that part of the problem is that when news content is shared on social media platforms, readers are being served ads on those platforms and not where the content was originally published.

In response, the industry has shifted, and jobs have been lost.

Per Pew Research Center, newsroom employment in the US dropped 26 percent between 2008 and 2020, resulting in the loss of tens of thousands of jobs.

As Meta notes, this problem isn’t new, and Facebook isn’t solely responsible for the dramatic shifts in the news industry.

However, NPR explains that based on figures provided by Insider Intelligence, content delivery services owned by Meta or Google “have collected nearly 70 percent of digital advertising revenue made in 2023.”

Bill Grueskin, a professor at the Columbia University School of Journalism, looked at the Australian law that required tech companies to pay publishers for their news content and concluded that it generated a whopping $150 million for news organizations. That revenue helped fund new employment.

California wants to take a crack at replicating the benefits afforded by Australia’s law, although its attempts have upset companies like Meta.

“We are now in a no-holds-barred battle for revenue, with many news companies, emboldened by the settlement in Australia, becoming quite vocal and aggressive in arguing this case,” says John Wihbey, a professor of journalism at Northeastern University in Boston.

Meta isn’t the only Opponent to Proposed Bill

“Everything about this is filthy and corrupt. It’s literally Rep. Buffy Wicks and others in the California legislature saying, ‘We’re forcing companies we dislike to give money to companies we like.’ I mean, if that’s okay, think of how many other industries are going to be cozying up to Wicks and friends asking them to get other industries to simply fork over cash. It’s basically just laundering the corruption by literally forcing one set of companies to bribe others,” writes Mike Masnick on Tech Dirt.

Masnick claims that California’s proposed law breaks the fundamental operation of the internet — the link — and gives the government oversight and regulatory power to force companies to pay for linking to other websites.

He also argues that the bill won’t help journalists and news media outlets but will disproportionately benefit specific companies, arguably “disinformation outlets.” Citing a study by Chamber of Progress, the beneficiaries of California’s journalism bill will be “FOX News and disinformation outlets,” not California-based media, and especially not black, Hispanic, and media in areas of the state lacking local news.

“This bill’s biggest winners aren’t California news outlets, they’re national media outlets known for spreading disinformation,” says Chamber of Progress CEO Adam Kovacevich. “By requiring online platforms to pay media outlets that produce viral articles, the CJPA actually makes the problem worse by incentivizing clickbait and misinformation.”

Bleeding Publishers Dry

However, as Troy Masters writes for The Sacramento Bee, “…To fight for our critical role to serve people in California in beyond, we’re proud to support the California Journalism Preservation Act (CJPA), AB 886, by Assemblymember Buffy Wicks.” Masters is the founder of celebrated news outlet The Los Angeles Blade.

He argues in support of CJPA, writing, “High-quality journalism has been under threat for years in California, and the circumstances are now existential. During the pandemic, an average of two newspapers closed every week across the country. That has led to journalism jobs lost, corruption unreported, and vacuums where harmful disinformation proliferates unchecked.”

Masters believes that CJPA will benefit publishers like him, and not just major out-of-state news organizations, and certainly not outlets that trade in disinformation.

Changing Consumption and the Path Forward

People consume news differently now than they did a decade ago and certainly much different than 25, 50, or even 100 years ago. The internet has changed the landscape of journalism and reporting for the better and arguably for the worse in other ways.

As consumption patterns shift, the amount of revenue and how it’s divided has changed at the expense of news organizations, especially smaller ones. For many people, the news that affects them most is local, and so-called “news deserts” are a major problem and a significant threat to the proliferation of meaningful, valuable journalism.

However, as Masters notes, many people see news on Google or Facebook and never leave that site to read the source. That means that these people who otherwise may have read the news via its source don’t do that. Instead, they provide ad revenue to social media companies rather than journalists and participate in a continuing cycle of data collection and selling.

“Put plainly, Big Tech is bleeding publishers dry without contributing any resources to creating high-quality content. This is not a theoretical problem. News deserts are a reality across California at a time when misinformation is at an all-time high, causing Americans’ trust in democracy and our institutions to erode at alarming rates,” Masters says.

How the California legislature will vote on its proposed bill is unclear. It’s also not obvious what will happen if the bill passes. But what’s certain is that tech companies, news outlets, and the local governments in other states are watching the proceedings unfold with significant interest.

Image credits: Header photo licensed via Depositphotos.