Meta's Ultimatum: No news for California unless El Reg receives payment
Meta, formerly known as Facebook, has issued a warning that it may block journalism content for users in California in response to a bill introduced by the state's legislature. The proposed California Journalism Preservation Act (CJPA) aims to mandate large internet platforms, including Meta, to compensate publishers for their use of journalistic work.
Specifically, online platforms with a minimum of 50 million monthly active users would be required to allocate a portion of the advertising revenue generated from the dissemination of news stories to the publishers responsible for creating the articles.
Meta, which operates popular platforms such as Facebook, Instagram, and WhatsApp, and boasts an impressive three billion daily active users, would fall under the jurisdiction of this legislation. The CJPA outlines that at least 70 percent of the advertising revenue shared with eligible publishers must be utilized for compensating journalists and support staff. Based on the details provided, it appears that El Reg, a publisher with offices in San Francisco, London, and other locations, would qualify for this compensation.
In addition to the financial aspects, the bill also includes provisions that prohibit any form of retaliation against media organizations that request these payments. Not surprisingly, Meta, known for its resistance to similar proposals in countries like Australia, Canada, and the United States, has expressed dissatisfaction with California's version of the CJPA.
Meta spokesperson Andy Stone vehemently stated, "If [the act] passes, we will be forced to remove news from Facebook and Instagram rather than pay into a slush fund that primarily benefits big, out-of-state media companies under the guise of aiding California publishers." California lawmakers intend for this legislation to help prevent a significant decline in the state's news industry, which has witnessed the closure of more than 100 titles over the past decade. Assemblywoman Buffy Wicks, a Democrat from Oakland who introduced the CJPA, is among those spearheading this effort.
Stone argued that Meta should not be held responsible for the shrinking media industry and claimed that news organisations willingly choose to share their content on Facebook and Instagram, essentially granting permission for Meta to utilise their work. Furthermore, he highlighted that the tech giant only earned a mere $23 billion in profit last year.
Stone added, "It is disappointing that California lawmakers appear to be prioritising the best interests of national and international media over their own constituents." This isn't the first time Meta has employed such tactics. The company has previously used similar arguments against ad revenue sharing in Australia, Canada, and the United States. While Canada's legislation is currently progressing through the legislative process, the federal legislation in the United States was referred to committee in November and has remained stagnant.
Meta went a step further in its opposition to Australia's proposal, initially ceasing the sharing of news links with Australian users for a brief period before ultimately relenting and agreeing to compensate Australian publishers for the use of their news content. In essence, CEO Mark Zuckerberg and his associates have not been particularly successful in their resistance to these measures thus far.
It remains uncertain whether the proposed bills in Canada, the United States, and California will be enacted. However, should they pass, it is unlikely that Meta's threat to ban news content from its platforms in these locations would hold true.
The precedent set in Australia demonstrates that all Meta achieved with its news blackout was some concessions through negotiations. Losing access to such a significant market as the United States and even Canada would be a substantial risk for the company. We reached out to Meta for further insights into its strategy but have yet to receive a response.