Internet for Growth Urges Governor Newsom to Veto Anti-Small Business Senate Bill 1047

Legislation would cut off access to AI tools small businesses are increasingly relying on

Internet for Growth, a coalition representing over 2,000 small businesses, strongly opposes Senate Bill 1047, the “Safe and Secure Innovation for Frontier Artificial Intelligence Models Act.” This bill threatens to undermine the ability of small businesses to leverage artificial intelligence (AI) and the potential it holds for their growth and competitiveness.

“SB 1047 would cut my business’s access to an emerging technology that has the potential to change everything,” said Russell Lowery, Owner of High View Strategies in Sacramento. “AI models will streamline workflow processes and amplify the power of my workers. This bill would close the doors for businesses like mine, putting an expensive price tag on the technology and leaving it out of reach for me. I urge Governor Newsom to veto SB 1047 and protect small businesses’ right to access new, groundbreaking technology.”

Katy Noochlaor, Owner of Tuk Tuk Thai in Los Angeles said the following, “Running a small business requires you to wear multiple hats: processing billing, invoicing, payroll, and more. Generative AI can help me and my staff push through the little things so we can focus on what we do best: giving our customers the best food and experience for their dollar. SB 1047 has the potential to undo this progress. It’s anticompetitive and, if signed into law, would force me to rely on the same old tedious tools. I urge the Governor to veto SB 1047 and promote competition.”

According to the U.S. Chamber of Commerce, nearly a quarter of small businesses are already using AI, and those businesses have reported a 12-point increase in their likelihood of seeing a profit increase compared to non-AI users. Additionally, 71% of small business owners plan to adopt the latest technology, including AI.

This bill would present a significant barrier to small businesses, which often operate with narrow profit margins. By restricting access to AI and open-source tools, SB 1047 would widen the gap between small businesses and large corporations, taking away a crucial tool that helps them compete.

Brendan Thomas, Executive Director of Internet for Growth, stated, “Small businesses are the backbone of our economy, and they rely on affordable, accessible technology to thrive. Senate Bill 1047 would impose significant barriers, cutting off essential AI tools that businesses can take advantage of. We urge Governor Newsom to veto this bill and support the continued growth and innovation of small businesses.”

Internet for Growth stands with small businesses and supports tools that will help them and their staff reach their full potential. The coalition is calling on Governor Newsom to veto SB 1047 and protect the right of small businesses to access and benefit from new, groundbreaking technology.

Internet for Growth, an initiative of the Interactive Advertising Bureau (IAB), promotes the crucial role digital advertising plays in the success of America’s small businesses, helping entrepreneurs bring their ideas to life. With the support of over 700 IAB members including marketers, agencies, publishers, and technology providers, as well as hundreds of small businesses and creators, we highlight the benefits of digital advertising to local economies, expanding opportunities for people of all backgrounds. Our work ensures policymakers in Washington understand the limitless opportunity the ad-supported internet provides for creativity, commerce, fair competition, and community.