As Ojai Valley News readers know, we have been making the case to revive journalism in California through legislation, i.e., state Sen. Steve Glazer’s bill, SB 1327.
The legislation failed in August, along with the other journalism bill — Assemblymember Buffy Wicks’ AB 886 — despite our best efforts, including the formation of a group of independent newsrooms called the California Independent News Alliance.
The bills were on course to pass until Gov. Gavin Newsom dealt a crushing blow when he signaled his intention to veto them. A “deal” was hastily cobbled together, and a win was claimed from the anemic agreement that allowed Google to get off with a paltry contribution of $15 million the first year. The bill’s murky details and future remain uncertain.
Since then, the OVN and more than 100 other California independent print newspaper companies like us soldier on under the constant existential threat posed largely by Google’s monopoly. Having failed to adequately address the problem via legislation, Ojai Media LLC has moved forward on another path — litigation.
To that end, we have joined news companies in six other states in a class-action antitrust lawsuit against Google LLC in the U.S. District Court in the District of Columbia.
Goal of lawsuit
To restore and ensure a fair and competitive playing field around Google’s publishing and dissemination of digital informational content in its general search services and ad services, we plaintiffs seek treble damages for overcharges, lost profits, withheld licensing fees, and unjust enrichment. We also seek to require Google to pay a fair share for news and establish guardrails to protect the integrity of online news.
The 154-page Amended Complaint was filed in May. The judge in our case, the Honorable Amit P. Mehta, recently ruled Google a monopolist company in the areas of search and advertising.
Here, the argument against Google is boiled down to its bare bones:
Abuses by Google
Google is the largest digital platform on the planet. It acts as a gatekeeper between consumers, publishers, and advertisers. Its ability to dominate others has no historical precedent. Its parent company, Alphabet, has a market capitalization of nearly $1.7
trillion. In 2022, it made more than $282 billion in revenue — 80% from digital ads.
Google doesn’t do any reporting. It free-rides on professional reporting, training its generative AI models to mimic journalists by using their content without permission and without payment.
Google misrepresents that it “teaches” its AI tools to write when it is actually republishing others’ content.
Google is starving the free press of readers and advertising revenue through various anti-competitive means. Every year, it siphons off billions in traffic from publishers by extracting, repackaging, and republishing their news content on a royalty-free basis.
The “donations” it makes to newsrooms through its Google News Initiative are to keep the information pipeline open, even while it drains the lifeblood from local newspapers — creating “news deserts” across the country.
Shifting of the bargain
It was not always like this. Google began life as a search engine, connecting users seeking information to publishers through hyperlinks. However, now in 2024, Google has become an answer engine that rarely connects users to publishers. Instead, Google gives the news directly to its users by extracting publishers’ content and republishing it on the search engine results pages. Gradually, it altered the terms of the once-beneficial trade bargain. Google now competes with, rather than serves, news publishers.
As Microsoft President Brad Smith put it: “Google has effectively transformed itself into the ‘front page’ for news, owning the reader relationship and relegating news content on their properties to a commodity input.”
Google became America’s largest news publisher through what may be one of the greatest antitrust violations of the 21st century. It has a 90% market share and garnered more than 767.8 billion visits between March 2023 and March 2024 — dwarfing other publishers. At the same time, Google sells publishers search-traffic referrals. In the area of advertising, formerly the main revenue for newspapers, Google has asserted its domination over the last 15 years. As Google’s ad revenue went up, publishers’ ad revenue plummeted.
Google’s stranglehold on search distribution means that publishers cannot bargain for a better deal. Google dictates the terms of trade for publishers. It has the dominant position on the entire digital ad stack, including the buy-side demand and sell-side inventory. By withholding a fair share from the news industry, Google is precipitating what The Atlantic recently called an “Extinction-Level Event.”
News is central to Google’s business model
Today, news is one of the top options on Google’s menu bar. Google fills the search-result pages with answer boxes and horizontal carousels featuring news. The top three organic results receive more than two-thirds of all clicks on the search results page.
Though 80% of Google searches are for informational content, the creators of news content are left with the crumbs. Robert Thomson, former managing editor of the Wall Street Journal, observed: “Our content is being harvested and scraped and otherwise ingested to train AI engines. … Our content will be synthesized and presented as distinct when it is actually an extracting of editorial essence. These are super snippets, containing all the effort and insight of great journalism.”
Anti-competition contracts
Google pays hundreds of millions to maintain its monopoly.
In 2022, Google, which shares board members with Apple, paid Apple $20 billion in its annual revenue-sharing, noncompete agreement. It also has exclusive deals with Android manufacturers and third-party browsers.
Free-riding on publishers’ investments in journalism
Google does not permit publishers to remove the years of content that has already been ingested by its Large Language Models. This means that Google’s AI products can plagiarize publishers’ content.
Google has misappropriated publishers’ news content to train AI products, exclude publishers from the market, and raise their expenses. By using news content without paying for it, Google provides itself with an artificially low cost of production compared with news publishers’ higher fixed costs.
Injury to the public
Google has a durable, unlawfully acquired and maintained monopoly in internet search and advertising. Because Google does not produce original news content, it is not replacing this lost output or reduction in quality.
To the contrary, Google is degrading the information ecosystem. Google’s repackaged news snippets are inferior products because they lack context, analysis, and nuance.
With nearly one-third of America’s newspapers closed and two-thirds of their journalists out of work, there is less news on the market and less accountability. When the news industry suffers, democracy suffers. The media play an essential role in holding government officials accountable and allowing informed participation in elections. Consumers will bear the long-term effects if publishers cannot sustain the costs of producing high-quality, trustworthy news and reference content.
For more information, see the Amended Complaint or contact me at the California Independent News Alliance: cina@ojaivalleynews.com.
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