EU copyright rules have long needed a shake-up. Since their overhaul in 2001 — four years before YouTube released its first video — digital innovation has revolutionised the traditional ways that content is distributed and consumed. The European Commission has now taken its first stab at rebalancing some of the rights content owners have in cyber space.
Its remedies are not novel and reflect complaints from publishers about the way they claim content aggregation sites such as Google misuse their copyright. But they are also unrealistic and unlikely to stick.
The proposed rules aim to redraw copyright in ways that strengthen the hand of traditional media. News publishers, such as the Financial Times, would have a right to demand a fee from news aggregators such as Google News when they show snippets of content. The rules crack down on the sharing of pirated content by asking video-hosting platforms to reach upfront licensing deals with the rights holders before featuring their content.
According to Günther Oettinger, the EU’s digital economy commissioner, this would allow the rights holders to “recapture value” from internet companies, thus creating “a stimulating, fair environment”.
However these intentions risk backfiring on the rights holders. Google was quick to warn that the rules would reduce “monetisable traffic, for free, to news publishers”. When Spain and Germany tried to impose similar rules on behalf of news publishers, far from proving a bonanza for content owners, it led to declines in traffic and advertising revenue. Most German publishers did not even try to impose the fees. In Spain, where it was compulsory, Google closed its local news aggregation site.
More worryingly, the new rules on pirated content could unintentionally hinder digital innovation, which is one of Europe’s fastest-growing sectors.
While it is reasonable to expect wealthy and technologically sophisticated platforms, such as YouTube, to shoulder responsibility for protecting content owners against indiscriminate pirating, this should be proportionate.
Case law has progressively loaded more obligations on to digital platforms as technology has advanced and businesses have become prosperous. But push all responsibility for copyright infringement on to these platforms and many businesses could be undermined.
Nor is it clear that stripping away safe harbour — shielding intermediary services such as YouTube from legal liabilities over material that users upload to its site — would lead to more revenues for old media. It is just as likely that consumers would sate their appetites for free content by returning to pirated content instead.
The kindest interpretation one can place on these proposals is that the commission has simply misunderstood the digital marketplace. A more cynical view is that it has caved in to fierce lobbying by a number of powerful European publishers such as Axel Springer.
It is in the interest of Jean-Claude Juncker, the commission president, to look again at this proposal. His flagship “digital single market”, the internal market’s extension to digital goods and services, will simply not turn into reality if the commission simultaneously imposes rules that make it harder for budding digital firms to compete.
While the ambition to steer copyright in a fairer direction is to be applauded, the substance should be fair and not simply benefit a minority of powerful players. Rewarding a select few at the expense of many others would mean replacing one bad system with another that is equally bad.
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