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Google (NASDAQ: GOOG) (GOOGL) has signed a first-of-its-kind deal with California lawmakers to provide up to $250 million over the next five years to support local newsrooms in the state.
The aim of this programme is to support journalism in the face of a sharp decline in Increase readership and revenue for traditional media while simultaneously increasing Google (GOOG) to circumvent a government regulation that would have required publishers to pay a fee for links to its content.
Critics argue that the agreement does not adequately address the challenges facing the industry and could cement Google’s (GOOG) dominance over newsrooms.
The Media Guild of the West, a union representing journalists in Southern California, Arizona and Texas, said journalists were excluded from the discussion. It also raised concerns about the potential risks associated with the AI initiatives.
“The future of journalism should not be decided by backroom deals,” the union wrote in a letter to lawmakers. “Legislators have tried to regulate monopolies and failed miserably. Now we’re wondering if the government has done more harm than good.”
Just over $110 million from Google (GOOG) and $70 million from the state budget will be used to increase employment in journalism. UC Berkeley’s Graduate School of Journalism will manage the fund. Rep. Buffy Wicks, who brokered the agreement, said Google (GOOG) will also contribute $70 million to support the AI research initiative.
The agreement is expected to take effect next year and will initially provide $100 million in seed capital for the effort.
The share price of Google’s parent company Alphabet (GOOG) rose slightly, by 0.51% to $165.49 on Friday during premarket trading.
