California, Google rework first-in-nation journalism deal amid state deficit

Politico

21-05-2025

SACRAMENTO, California — A landmark deal to funnel millions of dollars into California newsrooms risks being downsized after Gov. Gavin Newsom proposed funding cuts and Google, the initiative's main corporate partner, slashed a third of its original commitment on Wednesday.
Google, for now, will drop its 2025 contribution to the program to $10 million from $15 million. The move matches California's pledge, with Newsom slashing state funding for the deal to $10 million from $30 million last week in his plan to close a $12 billion budget deficit.
However, Google could still increase its contribution, pledging to match up to $5 million in any donations made to the newsroom fund, meaning its final 2025 contribution may meet the initial $15 million figure if public, private or philanthropic groups donate enough money.
'We appreciate the leadership of Governor Newsom and Assemblymember Wicks in fulfilling the framework established last year,' Jaffer Zaidi, vice president of global news partnerships at Google parent company Alphabet, said in a statement. 'We're committed to its success, and based on the agreement, we're pleased to match the State of California's initial contribution to the Civic Media Fund.'
The California State Library will host the fund after the UC Berkeley Journalism School backed away from the agreement late last year.
It's the first time details of California's journalism funding deal with Google, announced as a handshake agreement last summer, have been laid out in a document since. The agreement sets a powerful precedent for Google to tie journalism funding to what governments and other companies put in, giving it leverage as other states attempt to extract newsroom funds from the search giant.
Notably, the reworked deal did not come with a memorandum of understanding to hold Google to its end of the bargain. Instead, terms for California were outlined in a framework released Wednesday by Assemblymember Buffy Wicks, a Bay Area Democrat who led negotiations on the deal.
Wicks billed the fund as a first-in-the-nation solution to aid local outlets decimated by lost advertising revenues as readers turn to aggregation sites like Google News. Her release rebranded the initiative from the Newsroom Transformation Fund to the California Civic Media Fund.
'Sustaining local journalism will take all of us — government, philanthropy, and the tech sector — stepping up together,' Wicks said in the announcement. 'By investing in trusted, community-based journalism, we're strengthening civic engagement and protecting the foundation of our democracy.'
She plans to release a full proposal in a budget trailer bill in the coming days. State lawmakers will consider the bill as leaders work with Newsom's office to iron out a final state budget over the next few weeks.
No other sources of private funding were announced. But OpenAI's vice president of global affairs, Chris Lehane, said the company 'appreciates the opportunity to collaborate on this important project.'
The original deal emerged out of negotiations with state lawmakers, who had set off a battle with Google by proposing measures to force tech giants to pay online publishers, similar to countries like Canada.
That framework promised to send $180 million to California journalism programs over five years, including $125 million for the proposed transformation fund. California had initially promised to invest $70 million in a new 'Newsroom Transformation Fund' through 2029, while Google initially promised $55 million.
At the time, journalists' unions immediately blasted the agreement for committing nearly $70 million in Google's money to researching and developing artificial intelligence, a technology many reporters fear could replace their jobs.
UC Berkeley's Journalism School was initially named to host the fund but backed away amid concerns about how funding would be administered.
An advisory board will oversee and administer the funds, but the California State Library will have final say. The advisory board will increase to nine members from seven, adding two seats reserved for State Library appointees alongside news publishers, members of journalism ethics groups and journalists' unions.
Separately from the $10 million Google is pledging this year for the fund, the company will also continue its in-house newsroom support programs like the Google News Initiative, per the release.