Our Views

The legislative proposal is backward looking. It tries to reverse how the internet and online business works. It is counterproductive because it seeks to impose a business model – selling snippets and link – and technological solutions – filtering – onto a business that is innovating to find new opportunities. Business will get much harder for publishers who see search engines and social media, start-ups and innovation as opportunities and want to use the internet to grow stronger. This is the case, for example of El Diario, whose business model relies on creative commons licences that are incompatible with à neighboring right.

As it is, the Copyright Directive will mainly create a maze of complexity for lawyers to untangle, and potential for collecting societies to get more and more involved in publishers’ revenue streams, including online. It will create legal uncertainty and lead to years of political battles and litigation, which small publishers can’t afford. That means more intermediaries, more transaction costs, and also the need for more legal advice when journalists or publishers themselves use content on the web. You only have to look at the rather ill-conceived Spanish ancillary copyright: publishers are deprived of the ability to decide what to do with their content, and forced to let a collecting society charge for it. Whether they like it or not.

The consequences of the copyright proposal for online publishing, the internet, user generated content, web data-analytics, data-journalists, licensing and payments to collecting societies and more are far-ranging and unpredictable. There is a clear risk it will impact our digital business, and make it harder for anyone to build an online presence. Even before it goes through, there is a clear risk the legislation will go in unpredictable and counterproductive directions. For instance, this debate is likely to spillover into a discussion on contractual relationships or lead to the involvement of collecting societies who want to manage new revenue streams.

In terms of the perception of the news and entertainment publishing sector by the EU, this initiative is not great either. First, it’s a highly controversial proposal, and comes at a considerable costs – antagonising internet users, threatening fundamental freedoms and pitching technology against publishers. Publishers will be perceived as not innovating, resisting the digital transition and ready to antagonise internet users. Second, it will distract from some other important issues – for instance equal VAT for digital and print, the ongoing EU media regulation review – and reduce the say of publishers around those.

Publishers are like many other actors in the creative industries: game developers, app developers, music publishers, film distributors, photographers, managers, and even collecting societies. All these players rely on their contracts with creators to obtain the relevant copyright. Not having your own right does not mean that your investment is not protected or valued. It means that contracts are the chosen tool to claim copyright. Or should all the people who have copyright contracts now get a new neighbouring right?

For major news publishers in Spain, Germany, France, Italy and the UK, referrals from third party website and services (Google, Facebook, Twitter, email, instant messaging etc.) accounted for 66% of online traffic in 2014. This referral traffic adds up to an estimated €746m in value in 2014, according to Deloitte. If the proposal is implemented, online referrals and traffic will decline and online businesses will suffer. As it becomes more complex to aggregate and share news and other content online, aggregators will disappear or only interact with large established players. There is no real upside to this – people are not going to start buying more print newspapers if it’s harder for them to find your content. A much easier option for readers is to simply read non-European publications online instead.

The logic of the proposal is flawed, as it tries to “reverse” the way information works on the internet, and get back to the era of print publishing business models. The neighboring right will also alter the competitive dynamic online: short term, it will reduce digital traffic and revenues for all. Longer term, it will hurt the lesser known brands and news innovators who rely on the web to grow. And the right is likely to harm the competitiveness of European publishers online, as non-European publishers compete on a global internet.

We risk losing control or seeing more of our income managed by collecting societies. Both the Spanish and German models failed, but rely on collecting societies to administer the income (whether in law or in practice).

Smaller or online-only publishers will suffer the most – as they rely more on the internet to reach new audiences. Many online services will lack the resources to strike deals with every publishers out there, and will focus only on a few large ones. Lesser known outlets will lose a key channel for being discovered.

There is by now more than enough evidence that these rights are unhelpful, counterproductive and not in the interest of all publishers. But they are also bad for competition, media pluralism and for internet users. As news aggregators close and traffic referrals decline, many small and independent news sources will lose one of their main sources of revenue. This situation will result in less numerous and less diverse sources online. Also, the consumer experience will worsen as it becomes harder to find relevant news online.

It is impossible to limit the new right to “press” publishers who publish quality news – or even just news. Instead, it will apply to any content that is published in writings – which is most of what is available online. So, for example, public service broadcasters who publish news articles online, such as the BBC in the UK or RTVE in Spain would also get the same rights. A website spreading fake news or sharing unverified, low quality content would also qualify. So would content published on a blog. On WordPress alone, that amounts to 36.3 million new posts and 63.1 million new comments each month (see here).

So far, ancillary copyright laws have failed to deliver on their objectives. Whether in Spain or Germany, the laws yielded no positive impact for news publishers. They harmed the publishers who rely most on the internet to be discovered, as they lost online traffic.

In Germany, for example, the law mostly resulted in more litigation, without delivering on any of its objectives. In the latest instance, a Berlin court noted that the “win-win” situation – benefits for users, news publishers and news aggregators – would be set off balance should aggregators be forced to pay for snippets.

In Spain, Google News and other services closed shop, resulting in a loss of traffic to news publishers – and ultimately loss of revenue, particularly for smaller online publishers. A recent report commissioned by AEEPP shows a 13% decrease in traffic, which hit small publications the hardest. The losses in revenue are estimated to amount to €9 million per year, or around € 9-19 million in lost advertising revenue.