By CARLOS FUENTES/The Oregonian/OregonLive
SALEM — Oregon’s faltering journalism landscape could receive a significant boost if lawmakers approve a bill to require big tech companies including Google and Meta to pay money to local newsrooms and journalists.
Proponents of the bill, including Oregon publishers, professional journalism organizations and some media experts, say it would be a financial lifeline for newsrooms across the state while requiring tech companies to compensate publishers for profiting off of their locally generated content.
Opponents of the proposal, including lobbyists for large tech corporations or executives with ties to such firms, say the proposal would prompt those companies to restrict access to Oregon-generated news on their platforms, which could decrease peoples’ online engagement with the state’s news sites and particularly hurt small online publishers.
Senate Bill 686, introduced by Sen. Khanh Pham, D-Portland, would require large tech companies to pay at least $122 million per year to online news outlets in Oregon for accessing their content. Alternatively, they could opt to undergo an arbitration process to determine an alternative payment amount.
The figure of $122 million was calculated by Haaris Mateen, a University of Houston finance professor who said he conducted a study on market balance between tech companies and online news outlets. He said that is the amount that Meta and Google would pay to Oregon outlets if they were adequately compensated for the value they bring to those platforms.
The bill as currently written calls for each company of Google’s or Meta’s magnitude to pay that sum each year. But Pham said that was not its framers’ intent and that the bill will be adjusted to make clear that large tech companies would need to collectively pay that much.
More than a dozen lawmakers, including key caucus leaders in both chambers, have signed on as co-sponsors. The growing support for the bill raises the chances that Oregon could become one of the first states to implement a policy aimed at restoring local journalism by forcing tech giants to pay for news content.
The proposal would apply to digital platforms with at least 50 million monthly users in the United States owned by tech companies with net annual sales exceeding $550 billion nationwide or with more than 1 billion monthly users worldwide. In other words, it would only apply to massive companies like Google and Meta.
The majority of the money they would have to pay, 90 percent, would be distributed to outlets that produce news content for an Oregon audience and would be allocated based on the number of journalists each employ.
News outlets would be required to spend at least 70 percent of the funding on journalists’ salaries. Organizations with five or fewer employees would have more leeway — for example, they could use the money to pay freelance journalists.
The intent of the fund, Pham told the Senate Rules Committee last week, would be “to repair the harms that have already been done towards civic life and grow local journalism back from the brink.”
Journalism jobs in Oregon have fallen by 75 percent since 2001 amid declines in newspaper readership and advertisement dollars, according to data from the Oregon Employment Department. That has led to a depletion of high-quality news coverage in many rural Oregon communities and even some mid-size cities.
Another 10 percent of the revenue would go to a newly-established consortium hosted at the University of Oregon that would fund grants to local publishers and news startups, particularly in rural areas. The consortium would also support new journalism jobs and fund media training programs.
Proponents of the bill say Google and Meta benefit significantly from accessing news content and should compensate media organizations for it. For example, using algorithms, Google sifts through news sites and draws on journalist-generated content to create the A.I. summaries it serves up to people who conduct Google searches. It doesn’t, meanwhile, require searchers to click through to the news sites from which it harvested the information.
Proponents also argue that Meta, the parent company of Facebook, Threads and Instagram, attracts more users and advertising dollars when news outlets and their readers publish fact-checked, reported information that adds value to the platform.
“So you have this relationship where you have this enormously profitable advertising company that is still profiting off of journalism from Instagram without having to have users leave the ecosystem of Instagram,” said Matt Pearce, a former Los Angeles Times reporter who now serves as a senior policy advisor to Rebuild Local News, a nonprofit that advocates for policies to expand local news coverage.
Tech companies respond
Tech companies take issue with that argument. Meta executives argue that news content provides little value to the company and have commissioned studies that show Facebook actually helps drive traffic to local news sites. They say most of the news posted to Facebook is posted by news sites that willingly share their content in pursuit of clicks and engagement.
Google claims it is “one of the world’s largest financial supporters of journalism” and has argued that some news organizations benefit from grants it awards or from the traffic and ad revenue it helps drive. But its lobbyist did not provide specifics of how it’s supported any Oregon newsrooms.
A Google News Initiative grant formed a portion of the start-up funding for Lookout Eugene-Springfield, an online news site that officially launched last week in Eugene. Its founder, news entrepreneur Ken Doctor, testified against the bill last week.
On Monday, Doctor acknowledged receiving grants from Google for the Eugene outlet and a similar digital news site in Santa Cruz he launched four years ago. But he declined to disclose the size of those grants.
Tech industry representatives at last Wednesday’s public hearing strongly indicated to lawmakers that Meta and Google would take measures to restrict access to Oregon-based news sites from their platforms if the bill passes. That could happen in several ways. In Canada, for example, Meta responded to a similar law passed in 2023 by blocking Canadian news content on Facebook and Instagram.
The bill “would cut off critical traffic to news outlets, disadvantage smaller independent publishers and limit public access to reliable information,” Robert Singleton, regional policy and public affairs director for Chamber of Progress, an industry group that lists Google and Meta among its partners, told lawmakers.
Tech corporations have made those same threats in response to similar policies in California, Canada and Australia. But their efforts and success have varied widely.
Last December, for example, Australian officials successfully required large tech companies to continue payment deals with the country’s news publishers after Meta threatened to withdraw from those deals. The new mandate worked because the government threatened to hit tech companies with higher taxes if they chose to end the payments.
And last August, Google executives privately negotiated with California lawmakers and ultimately agreed to pay the state millions of dollars to support the state’s newsrooms in response to legislation that would have required significantly higher payments from the company.
Tech companies and other opponents of the Oregon bill have repeatedly said it would unfairly benefit out-of-state corporations and large media conglomerates that own newspapers in the state. Supporters argue that while some newspapers have out-of-state corporate owners, the funding would still directly support Oregon-based journalists. They also point out that the consortium would almost exclusively support local news outlets.
Many Oregon news publishers have thrown their support behind the bill. They range from large organizations like The Oregonian/OregonLive and Oregon Public Broadcasting to hyperlocal, independent outlets like McKenzie River Reflections and The Corvallis Advocate.
Several organizations, including the University of Oregon’s Agora Journalism Center, the Oregon Society of Professional Journalists and multiple unions representing journalists, also submitted testimony in support.
“It speaks volumes that the response from these gigantic digital platforms to this bill and others like it is to threaten to censor and take away news content from these sites and deprive their users of valuable and vetted information,” Mai Hoang, president of the Pacific Northwest Newspaper Guild, said during the public hearing.
A few smaller outlets, including Ashland News and News in the Grove, raised concerns that the bill wouldn’t go far enough to support small newsrooms or expressed fears that Meta and Google would retaliate.
“Maybe you could consider the impacts on local publishers like myself that are just battling day-to-day to make ends meet and report on the news. This bill leaves us out,” wrote Brad Fuqua, editor and publisher of Philomath News.
Fourteen Democratic lawmakers and one Republican have so far signed on as cosponsors of the bill. That includes Senate Majority Leader Kayse Jama of Portland and House Majority Leader Ben Bowman of Tigard, as well as other Democrats with significant sway in the Capitol.
That momentum doesn’t guarantee the bill will pass. As of Monday morning, the bill wasn’t scheduled for another hearing or a vote. And lawmakers could choose to significantly alter the proposal before the legislative session ends in June.
Lawmakers could also choose to negotiate with the tech companies. In Canada and California, Google indicated that it would be more likely to support similar policies if the government were also to pay to support newsrooms.
Sen. Jeff Golden, D-Ashland and co-sponsor of the bill, said that’s not an option. Lawmakers are currently attempting to find more funding for transportation, housing, behavioral health, wildfire prevention and education, among other major issues. Journalism funding is not on that list of priorities, he said.
“People are going to die from some of our failures to fund things this session,” Golden said. “The idea that we’re going to put out grants in this situation, when the immense wealth of these platforms is built in part on taking content from local newspapers, just isn’t in the cards.”
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