California Governor Wants Big Tech To Pay Consumers For Harvested Data

Privacy Cyber Security AH Nov 10 2018

California may be on the verge of kickstarting yet another unprecedented legislative effort after Governor Gavin Newsom said that his team has already been instructed to explore legal options for a “data dividend” that the ultra-rich technology sector in the state would be required to pay.

No other concrete details on the matter have been provided by the Governor but the announcement marks his first major policy proposal that wasn’t an integral part of his campaign trail. Governor Newsom was sworn into the highest state office some five weeks ago, having immediately signaled he’s looking to build on the precedent established last year after California enacted the first state-level privacy legislature akin to the European Union’s General Data Protection Regulation following a prolonged legal battle with Silicon Valley lobbyists.

California’s latest initiative manifested in a broad range of legislative forms and Governor Newsom was seemingly careful to leave virtually all doors open during his announcement of yet another move aimed at curbing the influence of the Silicon Valley in the state that hosts it.


One of the most obvious possibilities would be to require social media giants and other massive internet conglomerates reliant on harvesting user data to pay out annual dividends to consumers whose up-to-date information can be found in their databases. The actual sum would likely depend on a given company’s yearly turnover and possibly even factor in its reliance on mined information, though the latter would presumably be based on a contentious formula regardless of how it’s handled.

Another possibility is for Sacramento to demand a single payment from big tech, though that’s a significantly less likely scenario given how Governor Newsom appeared rather insistent on describing the plan as something meant to define a “dividend.” Facebook, Google, Apple, and Twitter are just some of the high-profile names headquartered in California that face the risk of having their operations complicated with the incoming legislation, though all of them seem to be treading carefully and have yet to issue a comment on the matter in any capacity.

Regardless of the road the California government decides to take, technology juggernauts in the state are unlikely to benefit from what’s now looming on the horizon. One of the richest and most liberal states by virtually every metric, California is still looking to pioneer digital legislation and pressure related industries to start conducting business in a more consumer-friendly manner or face harsh laws that are likely to follow more such similar-but-not-quite-identical rules in other states, sowing additional uncertainty into the stateside operations.


Google and Facebook had a rough 2018 in terms of their public image, with both companies taking a hit over reports of their concerning handling of user privacy. Facebook was arguably affected harder due to the sheer scope of the Cambridge Analytica scandal but Google has endured plenty of gaffes of its own, some of which it actively concealed while the world’s largest social media network was making headlines over not doing enough to preserve the privacy of its users.