California’s News Industry Faces Challenges but Sees Potential Support
California’s news industry has been struggling for years, as advertising revenue has steadily declined, largely due to competition from online giants such as Google and Meta. This trend has led to layoffs, smaller newsrooms, and less scrutiny of government actions. However, there may be some help on the way.
A bill awaiting Governor Gavin Newsom’s signature aims to support media companies that retain and hire journalists, offering around $55 million annually for the next five years in tax credits. Alongside this, the California Civic Media Program, which is backed by $20 million a year for three years—split between the state and Google—is set to issue grants of up to $250,000 for local newsrooms starting next month.
Despite the potential benefits of these funds, experts believe they fall short of what’s truly needed. A study from Northwestern University reveals that California has lost 41% of its local newspapers since 2005, with a national decline of 39%. The downturn means fewer journalists covering essential community matters, such as city council meetings, local elections, and events in neighborhoods.
Julie Patel Liss, a journalism professor at Cal State Los Angeles, noted, “There’s a crisis going on. Accurate, fact-checked information is as important as schools and libraries.”
Smaller media outlets, like the Mariposa Gazette—a weekly paper established in 1854—are hopeful that the new programs could provide crucial support. Publisher Greg Little remarked, “For people like us, this could make a world of difference.” He emphasized that improvements like raises and better equipment could greatly impact their operation.
While some news organizations are increasing their online subscriber base amidst declining print sales, the overall industry has suffered significant losses. Classified advertising revenue has been drastically reduced by platforms like Craigslist, while digital ad sales have shifted predominantly to Google and Meta, which now control around half of the global digital advertising market.
Recently, McClatchy, the parent company of several major newspapers, announced layoffs of reporters and editors, showcasing the continued struggles of the industry.
To combat these challenges, California lawmakers passed AB 2222, a new bill that offers tax credits for hiring journalists. The credits would provide $20,000 for each full-time journalist hired for the first five, and $15,000 thereafter, with part-time positions receiving $7,500.
“Every newsroom that shrinks means fewer voices asking tough questions and telling important stories,” said Assemblymember Buffy Wicks, who supports the bill.
However, the proposal has encountered opposition from groups like the California Taxpayers Association and the California Chamber of Commerce, who object to funding it by removing the ability of corporations to deduct executive compensation over $1 million.
Governor Newsom has not indicated whether he will sign the bill.
In addition to the potential tax credits, the $20 million California Civic Media Fund, introduced earlier this year, aims to support local journalism. This fund is a joint effort between the state and Google and came about after a failed attempt to revise antitrust rules that would have allowed publishers to negotiate with tech companies for better revenue sharing.
The fund is administered by the Governor’s Office of Business and Economic Development, which has outlined a timeline for announcing grant recipients in October. Proposals for funding have reportedly been submitted by around 350 news outlets.
While there are steps being taken to provide support, critics maintain that more must be done to address the significant challenges facing journalism in California. “We have a billion-dollar problem, not just a million-dollar one,” said Chuck Champion, president of the California News Publishers Association. The hope remains that these initiatives could help strengthen local news and ensure vital community stories continue to be told.
