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By Thomas Baekdal - September 2018

The EU Snippet Tax is not About Copyright. It's About Protecting the Press

As you may have heard, we are getting closer and closer to the EU link tax, the regulation where big tech companies like Google will be forced to pay publishers for linking to them. But it's not as simple as that.

So let's talk about this new regulation that might be coming, and also why we in the publishing world won't benefit from it.

It's not a link tax anymore. It's a non-press snippet tax

For those of you who don't know what this is, let me quickly summarize what has happened.

For the past many years (basically ever since 2001), publishers throughout Europe have been very annoyed about Google (and later Facebook) 'stealing' their revenue. They argue that most of the ad revenue is now going to Google and Facebook when it should go to the media, or so they say.

So, the media have been lobbying the EU quite aggressively over the past 10 years to get them to 'stop Google'.

The press and the media associations have been telling politicians that Google is stealing their revenue; that Google isn't paying their taxes; and recently they have started attacking Google and Facebook for their role in spreading fake news (which is arguably true, but it's more complicated than that).

As a result, the press has been lobbying for two specific changes to the digital copyright regulation. One is Article 11, which states:

Member States shall provide publishers of press publications with the rights provided for in Article 2 and Article 3(2) of Directive 2001/29/EC so that they may obtain fair and proportionate remuneration for the digital use of their press publications by information society service providers.

Or in simpler terms: "Google should pay the press."

And secondly in Article 13, which states, (in relation to):

Use of protected content by online content sharing service providers storing and giving access to large amounts of works and other subject-matter uploaded by their users.

1. Without prejudice to Article 3(1) and (2) of Directive 2001/29/EC, online content sharing service providers perform an act of communication to the public. They shall therefore conclude fair and appropriate licensing agreements with rights holders.

Or to put this in simpler terms: "YouTube should pay the press."

And this strategy is now beginning to work. After many years, the politicians are starting to cave in, and on September 12, 2018, they voted on a proposal for this legislation in which 438 voted in favor and 226 against. And with this, we are now suddenly much closer to a link tax.

Please note: At this point, it's very important for me to clarify that this isn't actually about links anymore, but about snippets. While it started out as a link tax, it has since been amended with this exception.

This protection does not extend to acts of hyperlinking which do not constitute communication to the public.

You can link just as you have always done, but if you start to do more than just link to content, (as in using the content or publishing snippets) then you should pay.

And you might look at this and think that this seems fair. Obviously, companies shouldn't be allowed to just use other people's content. And the author and creators of an article should have the right to decide whether an article is freely available or not, whether other sites should be allowed to use it, or whether you want people to come to you.

This seems fair... right?

Well, as a publisher myself, I do think this is fair. When I write an article, I want to be able to decide how that article can be used. I want to be able to put it behind a paywall so that I can get paid for writing it. And if someone else wants to use the article, I should be asked first and potentially compensated for it. As a basic principle and as a creator, other media companies shouldn't be able to make money from my work without compensating me for it.

So, basing copyright on licensing content seems entirely appropriate (but it gets more complicated than this). And to give you a simple example, think about this:

Imagine that the Swedish newspaper Dagens Nyheter wants to publish selected articles from the New York Times (and translate them to Swedish). Should they just be allowed to do that?

No, of course not. The New York Times should obviously be compensated when another company wants to use their content. And as a result, DN has now entered into a partnership with the NYT for exactly this type of use.

So, as an overall concept, I don't disagree with the principles of this regulation. If someone else makes money from publishing your content, you should get paid for it.

But this is also where this whole thing starts to fall apart.

The problem is that the press doesn't really believe in this principle. They believe that it's only Google that should pay. Because with the latest amendments to this copyright law, they added this:

This protection does not extend to acts of hyperlinking. The protection shall also not extend to factual information which is reported in journalistic articles from a press publication and will therefore not prevent anyone from reporting such factual information.

I'm sorry... what?

So, the press is saying that if they go online and they happen to come across some information that appears to be 'factual' (which is going to be impossible to define), the press should just be allowed to use it without compensating the creator.

But if Google (which is not defined as a 'press publication') does exactly the same thing, they should pay for it?

This is just wrong. We can't create a copyright law like this where journalists are treated like royalty and don't have to live up to the same regulations as everyone else.

Let me give you an example. Here is a screenshot from a newspaper (it doesn't matter what newspaper it is because this applies to all newspapers). As you can clearly see, they are publishing articles based on information from The Guardian (which is basically a snippet).

With this new regulation, the press is saying the newspapers should be completely free to do this without any form of compensation at all to The Guardian.

But if Google or Facebook did the same thing, then suddenly they should pay for it.

That's insane!

So, this entire regulation is just one big scam. They pretend that it's designed to protect digital copyright, but that's not what it is doing at all.

What is actually happening is that the press are saying that they want a law that prevents Google from competing with them; that prevents tech companies from using snippets of content; and that forces Google and Facebook to pay them... but at the same time, the press don't have to abide by the same rules and can just do whatever they want.

I'm sorry, but this is not acceptable in any way. This is the worst form of lobbyism and protectionism that I have ever seen. The level of entitlement displayed here is just insane.

This leads us to the second problem, which is about fair-use and quoting. In Europe, we have never really had any good definition of fair-use. But it's generally accepted that we are allowed to quote things.

The problem is that this new regulation just makes a mess of it, because it's like nobody really thought it through (or even read the legislation before voting on it).

When it comes to quoting, the current amendment of this legislation basically admits that it has no idea how to deal with it.

What it says is this:

(21b) Despite some overlap with existing exceptions or limitations, such as the ones for quotation and parody, not all content that is uploaded or made available by a user that reasonably includes extracts of protected works or other subject-matter is covered by Article 5 of Directive 2001/29/EC. A situation of this type creates legal uncertainty for both users and rights holders. It is therefore necessary to provide a new specific exception to permit the legitimate uses of extracts of pre-existing protected works or other subject-matter in content that is uploaded or made available by users. Where content generated or made available by a user involves the short and proportionate use of a quotation or of an extract of a protected work or other subject-matter for a legitimate purpose, such use should be protected by the exception provided for in this Directive. This exception should only be applied in certain special cases which do not conflict with normal exploitation of the work or other subject-matter concerned and do not unreasonably prejudice the legitimate interests of the rights holder. For the purpose of assessing such prejudice, it is essential that the degree of originality of the content concerned, the length/extent of the quotation or extract used, the professional nature of the content concerned or the degree of economic harm be examined, where relevant, while not precluding the legitimate enjoyment of the exception. This exception should be without prejudice to the moral rights of the authors of the work or other subject matter.

In other words, they are saying: "Whoops, we completely forgot about quoting... ehh... we should probably add something about that here."

This is how bad the regulation currently is. It's so filled with special interest by press associations and lobbyists that they haven't really thought this through.

You will notice that they are only talking about 'users', so they are not going into the problem with publishers and Google.

We also see this when we go back to the original legislation from 2001 that they are basing this on. Article 5 of this talks about exceptions, and it's basically divided into two.

The first part talks about exceptions for 'temporary use', which says this:

Temporary acts of reproduction referred to in Article 2, which are transient or incidental [and] an integral and essential part of a technological process and whose sole purpose is to enable a transmission in a network between third parties by an intermediary, or a lawful use of a work or other subject-matter to be made, and which have no independent economic significance, shall be exempted from the reproduction right provided for in Article 2.

This was originally added (as far as I know) to protect internet providers, so they wouldn't have to deal with copyright when transmitting a web page from one computer to another.

This seems quite reasonable. I mean, can you imagine the mess we would be in if internet providers suddenly had to deal with copyright of transmitting content online? That would just destroy the internet.

But then comes the second part that talks about other uses of quoting that are also exempt. Here it talks about personal use, educational use, scientific study, and other things like that... and then we also have this exception:

Reproduction by the press, communication to the public or making available of published articles on current economic, political or religious topics or of broadcast works or other subject-matter of the same character, in cases where such use is not expressly reserved, and as long as the source, including the author's name, is indicated, or use of works or other subject-matter in connection with the reporting of current events, to the extent justified by the informatory purpose and as long as the source, including the author's name, is indicated, unless this turns out to be impossible;

So, we are back to the same problem as before. The press is allowed to freely quote anything they want, as long as they give credit ... unless that turns out to be a bit annoying to do. But Google, not being defined as the press, can't.

Again, this might have made sense in the old days back when the press was distinctively different from everyone else. But today, this just makes no sense at all.

Let me illustrate why:

Imagine that there is another earthquake in Italy, which is originally reported by an Italian newspaper, and imagine that this was covered in four different ways.

  1. A non-Italian newspaper reports the story, based on the original article from the Italian newspaper. They credit it merely as "as reported by...".
  2. Google, as part of their 'Disaster response', puts up a snippet that summarized the news (in a knowledge box on Google Search), with a link back to the original story, as well as links to other press reports from other newspapers.
  3. 1000s of Facebook users share this news on their Facebook pages.
  4. Curation services start to curate this news by creating minimized summaries (like a 30 second summary), including a link to the full story.

So let me ask this simple question. Who should pay?

Well, with this new legislation the press is saying that the newspaper shouldn't have to pay anything, but Google, Facebook, and all the curation services should.

Okay... but just stop and think about what is happening here. All of these services take something from the original source, but what they give back is very different.

So, tell me again why the newspaper shouldn't have to pay for using other people's content, but Google, Facebook, and curators should?

From a purely economic perspective, it's the newspaper who is taking the most while giving the least.

On top of all this is the argument of how much money publishers could actually make from something like this. This in itself is a long discussion, (which you can read more about in "Let's Calculate What Publishers Could Earn from the Google 'Snippet Tax'").

Don't get me wrong. I obviously love the media and, like everyone else, I do believe in the freedom of the press, and I do believe the press should be allowed to report what is happening in the world.

Like everyone else, I also very firmly believe in the principles of journalism, that we are the fourth estate and the protectors of society.

And, I do believe that we need to have a robust discussion about copyright online. We need to talk about how we can make sure that the original source is compensated fairly, and we also need to talk about when the reuse of content is done for commercial purposes and when it is not.

The problem is that this is not what is happening with this legislation. We are not protecting society, we are merely protecting our own self-serving business interest to the detriment of the internet as a whole, and the ability for new media companies to challenge the way we define the media.

This helps nobody.

What we actually need is digital copyright legislation that takes all of this into account: that recognizes the difference in use cases; that understands the complexities around fair-use and quoting (which is the same as using snippets); that opens up a discussion about paraphrasing (which is just quoting while pretending that you are not); reuse, sharing, and linking.

But, most of all, we need a digital copyright legislation that is equal for all, and not one that only protects the traditional press from the new world of media.

If we in the media truly believed in digital copyright, we would not propose legislation that exempted us from it. We would propose something that would work for everyone.

So, let's stop this nonsense and have a real discussion about how we all can define this for the future.


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Thomas Baekdal

Founder, media analyst, author, and publisher. Follow on Twitter

"Thomas Baekdal is one of Scandinavia's most sought-after experts in the digitization of media companies. He has made ​​himself known for his analysis of how digitization has changed the way we consume media."
Swedish business magazine, Resumé


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