The proposed law, which would force Big Tech to pay publishers to collect news content online, goes to the Senate after the Judiciary Committee on Thursday approved a revised amendment that addresses censorship concerns.
The Journalism Competition and Preservation Act would temporarily exempt newspapers, broadcasters and other publishers from antitrust laws to jointly negotiate an annual fee from Google and Meta/Facebook, which dominate the nearly $250 billion digital advertising market.
Supporters say it will empower struggling news organizations and level the playing field with big tech, while critics question whether local journalism or big media outlets will be the true beneficiaries of the bill.
The bill stalled in committee two weeks ago after Senator Ted Cruz narrowly passed an amendment banning censorship “collusion,” sharply dividing bipartisan supporters of the bill.
At the time, Sen. Amy Klobuchar, D-Minn., lead co-sponsor of the bill, said the bipartisan legislation was “inflated” by the Cruz amendment, which would allow Big Tech to negotiate simply by arguing content moderation. But she worked with Cruz to draft a revised amendment to keep censorship off the table when the media and big tech negotiate content fees.
The replacement amendment further clarifies “that the focus of the bill is solely on compensating news organizations when platforms access their content, and that discussions or agreements between news organizations and platforms about content are outside the scope of the bill,” Klobuchar said.
The bill, which was tabled in the House and Senate last year, provides temporary protection from antitrust laws and allows news outlets to join forces to negotiate content fees for aggregated content on Google and Meta/Facebook, the only two platforms the proposed law aims.
The bill would cover thousands of local and regional newspapers, including the Chicago Tribune and other newspapers owned by Tribune Publishing, which was acquired by hedge fund Alden Global Capital for $633 million in May 2021. Major national publications such as The New York Times, The Washington Post and The Wall Street Journal.
Local television and radio stations — including network-owned and operated stations — that publish original digital news content and meet other licensing requirements would also be covered by the bill.
“This legislation misunderstands the relationship between Facebook and News and ignores our users’ preferences for new types of content,” a Meta spokesman said in an emailed statement Thursday. “Facebook does not proactively post messages on our platform – publishers and broadcasters are the ones who control if and how their content appears on Facebook, and they can use our free services as long as it adds value and makes business sense to them. ”
A Google spokesman did not respond to a request for comment.
By approving his amendment, Cruz backed the legislation, which passed the committee by a 15-7 vote and will go to the Senate for consideration.
“I think this change protects against this antitrust liability being used as a shield for censorship,” said Cruz, R-Texas. “Big Tech hates this law. That’s a strong plus for me to support it.”
The local media ecosystem has declined sharply in the new millennium. Newspaper advertising revenue, which peaked at $49.4 billion in 2005, fell more than 80% to $9.6 billion in 2020, according to the Pew Research Center. A recent study by Northwestern University’s Medill School of Journalism found that the country has lost more than a quarter of its newspapers — about 2,500 in total — and 60% of its working journalists since 2005.
Meanwhile, Big Tech has gobbled up most of the fast-growing digital advertising pie. According to Insider Intelligence, Google is expected to generate nearly $70.1 billion and Meta/Facebook $55.5 billion this year, or more than 50% of total US digital advertising spend.
Under the bill, the annual fee paid by Big Tech would be shared among all local publishers participating in collective bargaining, with 65% of the allocation based on how much they spend on journalists relative to their total budget.
“Today’s markup and vote was an important step in giving small and local news publishers the fair compensation they deserve for their content,” said David Chavern, president and CEO of the News Media Alliance, a Washington, DC-based company Newspaper trade organization issued a statement Thursday.
But diverse opposition to the bill, from journalists’ unions to digital rights groups, has sprung up against everything from temporarily derogating antitrust laws to undermining copyright and fair use online. The biggest concern could be whether payments from Big Tech would bolster local journalism or benefit major media outlets.
Those concerns were compounded last month when Gannett, the country’s largest newspaper chain, laid off 400 employees, or about 3% of its US workforce, after a larger-than-expected second-quarter revenue slump and loss. Based in McLean, Virginia, Gannett publishes USA Today and more than 230 other newspapers.
Sen. Alex Padilla, D-Calif., voted to pull the bill out of committee but said he could not support it in the Senate without “built-in consequences” to hold companies like Gannett and Alden, the second largest, to account newspaper chain if they don’t invest the Big Tech proceeds in journalists.
“I believe we need stronger language to ensure that the proceeds from this bill go to the workers who make journalism possible and are invested in the quality local journalism that those workers produce,” Padilla said.