Kristina Roberts
A major agreement between the state of California and a leading tech company, aimed at helping struggling local news organizations, is already facing reductions before any money has been distributed. The deal, worth $125 million, was announced last year as a way to support journalism by providing funding over five years. However, recent budget proposals suggest the state’s contribution may be significantly reduced, raising concerns about the future of the agreement.
The original plan involved both the state and the tech company contributing millions of dollars to a fund that would support local news outlets. In return, lawmakers dropped proposals that would have forced tech companies to pay news organizations for using their content. The deal was seen as a compromise, but critics argued it was not enough to address the financial challenges facing journalism. Now, with the state proposing to cut its initial payment from 30 million to 10 million, many are worried the program may not have the intended impact.
The reduction is part of broader budget cuts due to lower-than-expected state revenues. A spokesperson for the state’s finance department explained that the decision was based on financial constraints rather than a change in policy. However, this has frustrated advocates who believe the deal was already insufficient. Steven Waldman, president of a journalism advocacy group, called the move “extremely disappointing,” adding that the decline of local news is creating a void filled by misinformation.
Another issue is the lack of progress in setting up the fund. Initially, a major university was expected to manage the program, but it later declined, leaving the state without an administrator. Because of this delay, the tech company has not yet contributed its share of the funding. Without clear timelines or a managing body, the future of the deal remains uncertain.
The agreement was reached after intense lobbying efforts by the tech industry, which spent millions opposing earlier proposals that would have required payments to news organizations. Some lawmakers involved in the negotiations have remained optimistic, calling the current funding a “down payment” that could attract additional private and philanthropic support. However, without firm commitments, there are doubts about whether the full $125 million will ever materialize.
Supporters of the deal argue that any funding is better than nothing, especially as many local newsrooms continue to shut down. Critics, however, believe the agreement lets tech companies off too easily, allowing them to avoid stricter regulations. With the state now reducing its contribution, the pressure is on the tech giant to fulfill its promises—but so far, there has been no public confirmation of its next steps.
The situation highlights the ongoing struggle to find sustainable funding for journalism in the digital age. As traditional advertising revenue declines, news organizations are increasingly reliant on alternative sources of support. Whether this deal will provide meaningful help remains to be seen, but the early setbacks suggest it may fall short of expectations.
For now, local news advocates are urging leaders to prioritize journalism funding, warning that without strong, reliable news sources, communities will suffer. The coming months will be crucial in determining whether this agreement can be salvaged or if alternative solutions will be needed to support the future of local news.
