The Spanish parliament has passed a law allowing media organisations to charge tech giant Google for linking their sites with snippets of their content.
The law will mostly affect Google News which usually posts a short excerpt just below the link to stories from news websites.
Dubbed ‘Google Tax’ by the media, the law is set to take effect on January 1, 2015, with Spain possibly becoming the first country to enact legislation that allows the media to charge for linking site content online.
The passage of the law is the result of intense lobbying by the Spanish Association of Daily Newspaper Publishers (AEDE), an umbrella body comprising top media companies in the European nation.
The media companies argue that publishing snippets of their stories online is akin to ‘stealing’ or using intellectual property without paying for it.
The law will also affect other news aggregator sites like Yahoo! News that use the same model as Google News. Social networking sites like Twitter and Facebook are exempt from the law.
Spanish and other European media companies can count on the solid support of incoming EU digital chief, Günther Oettinger, who recently blasted Google for copyright infringement, giving the clearest indication yet that the US company’s woes in the EU are only just beginning.
“If Google takes intellectual property from the EU, and makes use of it, then the EU can protect this property and impose a levy on Google for it,” he was reported as saying in the German language newspaper Handelsblatt.
While Google is understandably disappointed by the decision of the Spanish parliament, the issue is not entirely new to the company. It has faced similar problems in Belgium and Germany when publishers demanded that the tech giant pay them for linking their stories on Google News.
Google, in a bid to avoid the charges, responded by taking down the links to their sites completely. However, some of the German publishers had to request Google to re-list them as they had lost a significant amount of traffic to their sites.
The development presents a dilemma for traditional mainstream publishers that would want to tax online news aggregators for posting links. While they may not be happy with Google and other news aggregators for posting their links, they still receive tonnes of traffic to their sites as a result.
Demanding royalty of some sort from them is a gamble as sites like Google and Yahoo! News may opt to not host their content at all to avoid payment.
Another problem with taking the legal route (like Spain’s AEDE did) to force news aggregator services to pay is that ultimately, it’s the news readers that are most disadvantaged. As tech blog gizmodo argues, Google News could choose to delist the sites as it did in Germany or close its doors on Spain altogether.
Other tech observers such as Techdirt note that it is absurd for newspapers that benefit from traffic resulting from listing on Google News to also want to get paid for a service or platform that the tech giant provides for free.
However, others have also noted (and rightly so) that Google benefits from ad revenue from the ads it places next to links containing ‘snippets’ of copyrighted material from journalists and other content creators.
In response to Rupert Murdoch-owned News Corp’s criticism that it was anti-competition and failing to play its part in combating online piracy, Google noted that it had helped newspapers generate traffic and sell their content on the Android App store.
“Google has worked hard to help publishers succeed online — both in terms of generating new audiences and also increasing their digital revenues. Our search products drive over 10 billion clicks a month to 60,000 publishers’ websites, and we share billions of dollars annually with advertising publishing partners.
“We’ve also created a digital store on Android — Google Play — that lets news publishers offer their publications for purchase or subscription,” said Google in a statement.
Google has also argued in the past that publishers can simply opt out of listings on the search engine. While it’s logically true, opting out of Google’s search engines would be career suicide for content creators as they risk going into oblivion.
Some analysts fear that the Spanish parliament’s actions could also set a precedent that if followed by legislators from other parts of the world could result in censorship.
They argue that enacting legislation such as the ‘Google Tax’ is an affront on the very basic premise of what the Internet is — a free space for sharing information.
It remains to be seen how the dispute plays out between Google and European media houses. Media owners from other parts of the world are certainly watching as any levies charged for listing by news aggregators could be a potential source of much-needed revenue in a world where the Internet has sounded the death knell for many traditional print publications.
For now, the debate is polarised between those who think that Europe is resorting to anti-competitive protectionism and others who believe that aggregators like Google News and Yahoo! News ought to share the revenue pie with content creators.