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Beware of Dragon Slayers Bearing Bad Ideas. They Might Not Be Fair. Or Useful

As should be obvi­ous to near­ly every­one with an inter­net con­nec­tion these days, Google is both real­ly use­ful and kind of ter­ri­fy­ing giv­en the scope of how much Google knows about near­ly all of us and how much it con­trols what we know [1]. The fact that Google’s list of cor­po­rate ambi­tions includes things like ‘own­ing the inter­net’ [2] and own­ing the inter­net’s pipes [3] does­n’t real­ly help. And then there’s the killer robots [4] and wage-theft [5]. All in all, it’s not hard to hope Google gets Scroogled [6]. Soon.

But there’s more than one way to screw Google and not every­one that fears Google is some ran­dom con­sumer. Major cor­po­rate enti­ties [7] also fear Google and it just so hap­pens that a coali­tion of many of the largest pub­lish­er in Europe has a plan to slay the Google Drag­on [8] they fear so much. Unfor­tu­nate­ly, this coali­tion might slay “fair use” [9] across the inter­net in the process. That’s right, copy­right law could be get­ting a big ‘upgrade’ in the dig­i­tal realm as part of a new anti-Google ini­tia­tive in a way that upgrades the bot­tom line of the biggest pub­lish­ers and down­grades every­one else’s gen­er­al abil­i­ty to find news arti­cles and talk about the world. This is hap­pen­ing.

So here’s a quick sum­ma­ry of what just hap­pened:
The Euro­pean par­lia­ment is set to vote a motion propos­ing that Google and oth­er inter­net tech­nol­o­gy com­pa­nies [10] be bro­ken up in the EU. The par­lia­ment itself can’t break up these firms, so it’s real­ly more a plea to EU reg­u­la­tors. Con­sid­er­ing that Google con­trols 95% search engine mar­ket share in the EU, it’s not a shock­ing move and maybe even appro­pri­ate.

What is shock­ing is man­ner in which the new laws that, right now, are focused on rein in Google will also rad­i­cal over­haul of how we use the inter­net and, even more con­se­quent­ly, it might change how we read the news and under­stand our world. And it’s the EU’s major pub­lish­ers that are effec­tive­ly writ­ing these new laws. THAT’s what’s so shock­ing. The EU’s new “com­pe­ti­tion min­is­ter”, Germany’s Gün­ther Oet­tinger, is already call­ing for reviv­ing some­thing that’s been in the Euro­pean pub­lish­er’s wish-list for years: imple­ment­ing at the EU-lev­el laws that have been per­co­lat­ing across EU mem­ber states that make Google and oth­er “news aggre­ga­tors” [11] pay a fees to pub­lish­ers for list­ing their news head­lines and a tiny snip­pets on their sites.

Google’s com­peti­tors are also call­ing for reg­u­lat­ing Google’s search engine algo­rithms [12] and there’s even the pos­si­bil­i­ty that Google might even be forced to share cus­tomer infor­ma­tion with rivals if that infor­ma­tion is deemed “indis­pens­able” for com­pe­ti­tion [13]. These are the kinds of new rules Google’s rivals are ask­ing for and it appears to be the case that the EU par­lia­ment is now plan­ning on mak­ing many of these indus­try ini­tia­tives law. Soon. Which one’s will become law? That remains to be seen, but big changes are com­ing to the EU’s inter­net regime and, in the words of the EU com­pe­ti­tion min­ster Gün­ther Oet­tinger [14]:

...
“We are seek­ing uni­fied data pro­tec­tion across Europe, one which Amer­i­can com­pa­nies will have to abide by as well. If this is not the case there is scope for puni­tive mea­sures and fines,” the dig­i­tal econ­o­my com­mis­sion­er warned. On the copy­right ques­tion he also said, slight­ly mys­te­ri­ous­ly: “We want Euro­pean copy­right leg­is­la­tion and we want com­pa­nies like Google to adhere to Euro­pean copy­right stan­dards. We have the legal juris­dic­tion for this and we want to bring a degree of fair­ness into the rela­tion­ship between the users, Google and its com­peti­tors.”
...

In oth­er words, mak­ing these new EU changes apply to US firms (and pre­sum­ably firms every­where else), means the EU is poten­tial­ly going to change how the inter­net and copy­right law work glob­al­ly (the rest of the world is inter­est­ed in EU news too, after all). Again, soon.

All of this is hap­pen­ing as part of an ini­tia­tive to rein in Google. And since Google is so big and scary these days, it means some poten­tial­ly very big and scary new rules and reg­u­la­tions that impact much more than just Google could become the new law of the inter­net (or at least large parts of the inter­net) under the ban­ner of slay­ing the Google Drag­on [8]. Drag­on slay­ing might come with a lot of asso­ci­at­ed fan­fare and deserved­ly so. Drag­on slay­ing is hard. But that does­n’t mean oth­ers kinds of cor­po­rate beasts aren’t already wait­ing in the wings. And and does­n’t mean those beasts did­n’t get the fan­cy idea of going into the drag­on slay­ing busi­ness them­selves [15]:

Finan­cial Times

Novem­ber 21, 2014 6:23 pm
Google break-up plan emerges from Brus­sels

Hen­ry Mance, Alex Bark­er and Murad Ahmed

The Euro­pean par­lia­ment is poised to call for a break-up of Google, in one of the most brazen assaults so far on the tech­nol­o­gy group’s pow­er.

The gam­bit increas­es the polit­i­cal pres­sure on the Euro­pean Com­mis­sion, the EU’s exec­u­tive arm, to take a tougher line on Google, either its antitrust inves­ti­ga­tion into the com­pa­ny [16] or through the intro­duc­tion of laws to curb its reach.

A draft motion seen by the Finan­cial Times says that “unbundling [of] search engines from oth­er com­mer­cial ser­vices” should be con­sid­ered as a poten­tial solu­tion to Google’s dom­i­nance. It has the back­ing of the parliament’s two main polit­i­cal blocs, the Euro­pean People’s Par­ty and the Social­ists.

A vote to effec­tive­ly sin­gle out a big US com­pa­ny for cen­sure is extreme­ly rare in the Euro­pean par­lia­ment and is in part a reflec­tion of how Germany’s politi­cians have turned against Google this year.

Ger­man cen­tre-right and cen­tre-left politi­cians are the dom­i­nant force in the leg­is­la­ture and Ger­man cor­po­rate cham­pi­ons, from media groups to tele­coms, are among the most vocal of Google’s crit­ics [17].

Since his nom­i­na­tion to be the EU’s dig­i­tal com­mis­sion­er, Germany’s Gün­ther Oet­tinger has sug­gest­ed hit­ting Google with a levy for dis­play­ing copy­right-pro­tect­ed mate­r­i­al; has raised the idea of forc­ing its search results to be neu­tral; and voiced con­cerns about its pro­vi­sion of soft­ware for cars.

Google has become a a light­ning rod [18] for Euro­pean con­cerns over Sil­i­con Val­ley, with con­sumers, reg­u­la­tors and politi­cians assail­ing the com­pa­ny over issues rang­ing from its com­mer­cial dom­i­nance to its pri­va­cy pol­i­cy. It has reluc­tant­ly accept­ed the Euro­pean Court of Justice’s rul­ing on the right to be for­got­ten, which requires it to con­sid­er requests not to index cer­tain links about people’s past.

The Euro­pean par­lia­ment has no for­mal pow­er to split up com­pa­nies, but has increas­ing influ­ence on the com­mis­sion, which ini­ti­ates all EU leg­is­la­tion. The com­mis­sion has been inves­ti­gat­ing con­cerns over Google’s dom­i­nance of online search for five years, with crit­ics argu­ing that the company’s rank­ings favour its own ser­vices, hit­ting its rivals’ prof­its.

“Unbundling can­not be exclud­ed,” said Andreas Schwab, a Ger­man MEP who is one of the motion’s back­ers.

...

Unbundling of ser­vices. That’s clear­ly one of the top pri­or­i­ty of the EU par­lia­men­t’s new ini­tia­tive, led by a coali­tion of Ger­man MEPs and the new EU dig­i­tal com­mis­sion­er, Gün­ther Oet­tinger.

But as we’ll see in the excerpts below, unbundling is real­ly just one of the goals EU MEPs and Oet­tinger are going to be fight­ing for in the com­ing months and years. EU pub­lish­ing giants, led by the Ger­man giants like Axel Springer, are call­ing for a fun­da­men­tal over­haul of how inter­net copy­right works, at least for com­pa­nies oper­at­ing in the EU. It’s an agen­da that would force Google to pay pub­lish­ers for using their head­lines and snip­pets while link­ing to their arti­cles. Inter­est­ing­ly, just ear­li­er that month, before the EU par­lia­ment called for break­ing up Google and the EU’s com­pe­ti­tion min­is­ter “sug­gest­ed hit­ting Google with a levy for dis­play­ing copy­right-pro­tect­ed mate­r­i­al”, Ger­man pub­lish­ing giant Axel Springer appeared to have giv­en up on that very plan. So this recent announce­ment that the EU was going to attempt to imple­ment new copy­right laws that would charge Google fees for news head­lines must have been extreme­ly reviev­ing to Axel Spring and the oth­er Ger­man pub­lish­ers that were suing Google for sim­i­lar copy­right fees very unsuc­cess­ful­ly [19]:

ZDNet
Ger­man pub­lish­ing giant Axel Springer caves in over Google news snip­pets row

Sum­ma­ry: Could the long-run­ning bat­tle between the pub­lish­ing giant and the search engine final­ly be at an end?
By Liam Tung for The Ger­man View | Novem­ber 6, 2014 — 10:12 GMT (02:12 PST)

Ger­man pub­lish­er Axel Springer has with­drawn its demand that Google pay to pub­lish news snip­pets from its pub­li­ca­tions, in the lat­est twist to the scuf­fle over copy­right fees.

Under a new ‘free license’, Axel Springer is allow­ing Google to dis­play por­tions of text from news sto­ries pub­lished by four of its sites: welt.de, computerbild.de, sportbild.de, and autobild.de.

The move by the Ger­man pub­lish­ing giant fol­lows a stand­off over Ger­many’s ancil­lary copy­right law which Axel Springer argued enabled it to demand licens­ing fees from search engines like Google for repub­lish­ing por­tions of a sto­ry. Google has main­tained that its ser­vice ben­e­fits pub­lish­ers and so it should not have to pay a fee.

In June, fee-col­lect­ing body VG Media — a con­sor­tium of pub­lish­ers includ­ing Axel Springer — sued Google over the issue. Google respond­ed in Octo­ber [20] by halt­ing its index­ing of news snip­pets and thumb­nails of VG Media con­tent, instead only dis­play­ing head­lines. At the time, VG Media said it was being black­mailed by Google.

Announc­ing the free license for Google yes­ter­day [21], Axel Springer said that traf­fic to the sites had declined by near­ly 40 per­cent since Google stopped pro­duc­ing snip­pets and thumb­nails on Octo­ber 23. It also claimed that traf­fic to the Ger­man sites from Google News was down by almost 80 per­cent.

With­hold­ing the free license was part of the pub­lish­er’s plan to demon­strate what it sees as Google abus­ing its dom­i­nant pow­er to force pub­lish­ers into licens­ing their con­tent for free. As Axel Springer not­ed, its aim was to “doc­u­ment the effects of the down­grad­ing of search results as part of ongo­ing legal pro­ceed­ings to enforce the exist­ing press ancil­lary copy­right law”.

Axel Springer was one of the pri­ma­ry forces lob­by­ing for the ancil­lary copy­right bill [22], which came into effect on August 1 last year. What has­n’t been clear is whether the bill grant­ed the Ger­man pub­lish­er a right to demand fees, which Google has nev­er paid.

At its quar­ter­ly earn­ings update yes­ter­day, the pub­lish­er’s CEO Dr Math­ias Döpfn­er called the move “the most suc­cess­ful fail­ure we have ever expe­ri­enced”.

“As sad as it is, we now know very pre­cise­ly just how far-reach­ing the con­se­quences of the dis­crim­i­na­tion are, as well as the real effects of Google’s mar­ket pow­er and how Google pun­ish­es every­one who exer­cis­es a right that has been grant­ed to them by the Ger­man Bun­destag.”

...

The bat­tle over copy­right is like­ly far from over, how­ev­er. Incom­ing dig­i­tal chief for the Euro­pean Com­mis­sion, Gün­ther Oet­tinger, last week sug­gest­ed Google be slugged with a copy­right tax [23] if it uses Euro­pean intel­lec­tu­al prop­er­ty.

Well that clear­ly did­n’t work out well for Axel Springer. Google de-indexed Axel Springer-owned con­tent after Axel Springer sued for headline/snippet fess and the pub­lish­er’s traf­fic declined 40 per­cent, includ­ing an 80 decline in traf­fic from Google News. It cer­tain­ly demon­strates the pow­er of Google News in dri­ving traf­fic to Ger­man news sites and it’s a reminder that the peo­ple crit­i­cal of Google’s monop­o­lis­tic size do have a very valid point. Google is wild­ly impor­tant. That’s one rea­son the EU par­lia­men­t’s new plan for break­ing up Google and/unbundling its ser­vices might have some sig­nif­i­cant suc­cess­es. Google real­ly has gob­bled up much of the Euro­pean dig­i­tal mar­ket for core ser­vices like search­ing.

A New Stan­dard (For Squeez­ing Web­sites)
And yet it’s hard to ignore the fact that forc­ing Google to pay Ger­man pub­lish­ers for head­lines and blurbs is just about the scari­est thing you could imag­ine for the inter­net if that catch­es on. How far is the “pay us for head­lines and blurbs” trend going to go? We’ll have to wait and see but, again, it’s with not­ing that EU com­pe­ti­tion min­is­ter Oet­tinger said, “We are seek­ing uni­fied data pro­tec­tion across Europe, one which Amer­i­can com­pa­nies will have to abide by as well. If this is not the case there is scope for puni­tive mea­sures and fines” [14]:

GigaOm
Euro­pean Par­lia­ment report­ed­ly wants Google to be bro­ken up
David Mey­er
Nov. 21, 2014 — 11:10 AM PST

The Euro­pean Par­lia­ment is about to call for the “unbundling” of Google’s search busi­ness from the rest of its oper­a­tions, as one poten­tial way to chal­lenge the company’s mar­ket dom­i­nance, accord­ing to a report in the Finan­cial Times [24].

The FT said Fri­day that it has seen a draft motion that has the back­ing of the Euro­pean People’s Par­ty and the S&D (the Social­ists), which are by far the two biggest blocs in the Par­lia­ment, with a com­bined weight of around 55 per­cent. The motion appar­ent­ly urges the Euro­pean Com­mis­sion – which unlike the Par­lia­ment does have the author­i­ty to break up com­pa­nies – to “take a tougher line on Google”, in the FT’s words.

The Par­lia­ment report­ed­ly would like the Com­mis­sion to tack­le Google’s dom­i­nance either through its ongo­ing antitrust probe into the firm’s search tac­tics – cur­rent­ly on pause as new com­pe­ti­tion com­mis­sion­er Mar­grethe Vestager re-eval­u­ates where things stand [25] — or by some oth­er means. It is worth not­ing that Vestager’s pre­de­ces­sor, Joaquin Almu­nia, was of the opin­ion that Google could not be bro­ken up under exist­ing com­pe­ti­tion leg­is­la­tion [26]. Then again, he was also keen­er than every­one else to agree an ear­ly set­tle­ment with the firm, and ulti­mate­ly failed to do so.

Google has a much high­er share of the search mar­ket in Europe – well over 90 per­cent – than it does in the U.S., which is why its prac­tices mat­ter so much [27] there. Some of the crit­i­cisms call out clear­ly anti­com­pet­i­tive prac­tices, such as Google pro­mot­ing its own ser­vices over those of rivals [28] in its results, but oth­ers have been pil­ing into the case in recent months.

Of par­tic­u­lar note is the cam­paign against Google [29] by press pub­lish­ers, par­tic­u­lar­ly those in Ger­many. The new dig­i­tal econ­o­my com­mis­sion­er, the Ger­man Gün­ther Oet­tinger, has the copy­right reform brief and has indi­cat­ed that he wants to take the pub­lish­ers’ side [30] in their quest to extract mon­ey from the firm for using snip­pets of their text in its search results.

Beyond antitrust, Google has also repeat­ed­ly shrugged off [31] data pro­tec­tion fines across Europe, as nation­al pri­va­cy reg­u­la­tors try des­per­ate­ly but unsuc­cess­ful­ly to force a change in its ways. Oet­tinger said [32] in a Thurs­day pub­lic Q&A ses­sion with the Ger­man Press Asso­ci­a­tion (DPA) that “if com­pa­nies based out­side the EU want to oper­ate with their dig­i­tal ser­vices with­in the Euro­pean dig­i­tal mar­ket and have access to data which they then store or eval­u­ate, then they must adhere to our rules.”

“We are seek­ing uni­fied data pro­tec­tion across Europe, one which Amer­i­can com­pa­nies will have to abide by as well. If this is not the case there is scope for puni­tive mea­sures and fines,” the dig­i­tal econ­o­my com­mis­sion­er warned. On the copy­right ques­tion he also said, slight­ly mys­te­ri­ous­ly: “We want Euro­pean copy­right leg­is­la­tion and we want com­pa­nies like Google to adhere to Euro­pean copy­right stan­dards. We have the legal juris­dic­tion for this and we want to bring a degree of fair­ness into the rela­tion­ship between the users, Google and its com­peti­tors.”

...

As the arti­cle points out, Google has repeat­ed flout­ed the EU’s data-pri­va­cy laws “as nation­al pri­va­cy reg­u­la­tors try des­per­ate­ly but unsuc­cess­ful­ly to force a change in its ways”. And that’s cer­tain­ly a large [33] con­cern [34]. Google’s size and the Panop­ti­can-ish nature of its busi­ness mod­el [35] makes it legit­i­mate­ly scary (not to men­tion Google’s ever-grow­ing mil­i­tary con­tract­ing busi­ness [36]). But is cre­at­ing an inter­net mod­el imposed at the EU lev­el where EU pub­lish­ers, pos­si­bly all EU pub­lish­ers some­day, get paid for head­lines or blurbs real­ly part of the solu­tion we want to be pur­su­ing? Does­n’t that threat­en to make search engines biased towards few­er news results in gen­er­al? Do we real­ly want to set up a legal prece­dent at the EU lev­el where head­lines and blurbs are a fee-based lux­u­ry?

If the fees are lim­it­ed to Google and oth­er giants who cares [37]. Google will be fine [38] and the pub­lish­ers could prob­a­bly use the mon­ey more. But it seems high­ly ques­tion­able to assume that these fees are going to be restrict­ed to large search engines and big ‘news aggre­ga­tors’ in the long run. At least not as long as it’s the big pub­lish­ers that are lead­ing the way.

And now that Gün­ther Oet­tinger has made it one of his goals to cham­pi­on the agen­da of the Ger­man pub­lish­ers, keep in mind that ear­ly indi­ca­tions were that those pub­lish­ers had far grander agen­da the headlines/snippets fees [39]:

GigaOm
Google lash­es out at Ger­man copy­right ‘threat’
David Mey­er
Aug. 21, 2012 — 8:39 AM PST

Google has launched a broad­side against a pro­posed law in Ger­many that would see search engines forced to pay license fees for link­ing peo­ple to news sto­ries.

Well, actu­al­ly that’s slight­ly inac­cu­rate: the draft law would make search engines pay for repro­duc­ing news­pa­pers’ head­lines and first para­graphs. So, take those away and the links are fine. Even if nobody will have the faintest idea what they’re link­ing to.

...

Ober­beck also point­ed out the obvi­ous: that Google send read­ers to the pub­lish­ers’ sites. And that any­one who doesn’t want their con­tent to be indexed by Google can just throw a robots.txt file in there. And that pub­lish­ers make mon­ey off Adsense.

But wait, let’s back up. To appre­ci­ate the full [40] absur­di­ty of the sit­u­a­tion, we should take in a lit­tle his­to­ry.

The Ger­man pub­lish­ing hous­es, par­tic­u­lar­ly Axel Springer, are very pow­er­ful in their coun­try, with rel­a­tive­ly strong influ­ence in gov­ern­ment cir­cles. As Matthias Spielkamp of the copy­right news site iRights [40] put it to me:

“If you look at the U.S., if print hous­es there want some­thing, they are up against Amer­i­can com­pa­nies like Google and Yahoo. Here we have local pub­lish­ers that are enor­mous­ly pow­er­ful and are try­ing to tar­get U.S. com­pa­nies. I wouldn’t say it’s anti-Amer­i­can – it’s just that Ger­man politi­cians are much more inclined to pro­tect Ger­man pub­lish­ers’ inter­ests when bal­anc­ing that with a [for­eign] com­pa­ny or indus­try.”

A cou­ple of years ago, a leaked draft showed what plans the pub­lish­ing hous­es were pitch­ing to their friends in the coali­tion gov­ern­ment. The first offi­cial draft leg­is­la­tion showed up in April [41]. What it pro­posed was breath­tak­ing.

The gov­ern­ment was call­ing for a form of ‘ancil­lary copy­right’ to be brought in, that would force com­pa­nies to pay pub­lish­ers license fees for using their work in a com­mer­cial set­ting. As in, employ­ers would have to pay up for let­ting their employ­ees read the news online at work.

Ger­man indus­try bod­ies were pre­dictably apoplec­tic, as were oppo­si­tion par­ties, and the gov­ern­ment beat a hasty retreat. The sec­ond draft, which appeared in the last cou­ple of months, dras­ti­cal­ly nar­rowed the scope of the leg­is­la­tion, so that it would only apply to search engines.

So now Google is furi­ous for being picked on, when it actu­al­ly dri­ves traf­fic to the pub­lish­ers.

And the pub­lish­ers aren’t hap­py either – Anja Pasquay, a spokes­woman for the Fed­er­al Asso­ci­a­tion of Ger­man News­pa­per Pub­lish­ers (BDZV), told me that the sec­ond draft “won’t help”, and her orga­ni­za­tion would rather see a revival of the first draft.

...

On bal­ance, it’s dif­fi­cult not to take Google’s side on this one. The whole idea of this kind of ancil­lary copy­right is ridicu­lous, and it puts the likes of Axel Springer in a very poor light indeed.

It’s not as though Axel Springer isn’t plung­ing head­first [42] into the web indus­try itself – only today, it announced the pur­chase of an online news and clas­si­fied por­tal [43].

The Ger­man pub­lish­ing giants are big enough to com­pete in the real world. Sure, it’s tough mon­e­tiz­ing free web con­tent. But cook­ing up hokey and self-defeat­ing new copy­right laws is a pret­ty shab­by way to go about it.

Let’s hope this was an exager­a­tion, but once again:

The gov­ern­ment was call­ing for a form of ‘ancil­lary copy­right’ to be brought in, that would force com­pa­nies to pay pub­lish­ers license fees for using their work in a com­mer­cial set­ting. As in, employ­ers would have to pay up for let­ting their employ­ees read the news online at work.

And when that pro­pos­al was cut out of the first draft of the Ger­man leg­is­la­tion:

And the pub­lish­ers aren’t hap­py either – Anja Pasquay, a spokes­woman for the Fed­er­al Asso­ci­a­tion of Ger­man News­pa­per Pub­lish­ers (BDZV), told me that the sec­ond draft “won’t help”, and her orga­ni­za­tion would rather see a revival of the first draft.

And now we have an EU dig­i­tal com­mis­sion­er Oet­tinger is open­ly express­ing inter­est in reviv­ing the pub­lish­ing giants’ ‘headlines/blurb roy­al­ties’ request.

The French (and Span­ish and Bel­gian) Con­nec­tion
So just how crazy might this going to get? Keep in mind that while Ger­many’s offi­cials are clear­ly lead­ing the way on this ini­tia­tive, this is far from being a Ger­many-only project. Spain [44], France, and Bel­gium are already mak­ing Google pay sim­i­lar fees. So if there’s a push to make this the mod­el for the entire EU there’s already plen­ty of prece­dent:

GigaOm
Why Google’s set­tle­ment with French pub­lish­ers is bad for the web
Math­ew Ingram
Feb. 4, 2013 — 8:10 AM PST

After much diplo­mat­ic maneu­ver­ing and a series of face-sav­ing ges­tures on both sides, Google final­ly signed an agree­ment with French news­pa­per pub­lish­ers [45] late Fri­day that puts to rest a long-stand­ing legal bat­tle over Google’s behav­ior in excerpt­ing sto­ries on Google News, which the French have argued is copy­right infringe­ment [46]. But while the search giant may be relieved to put the whole ker­fuf­fle behind it, there’s an argu­ment to be made that it has actu­al­ly done more harm than good — not only to its own inter­ests, but to the inter­ests of the open web as well.

Vet­er­an tech blog­ger Lau­ren Wein­stein describes this risk well in a recent blog post, in which he calls what the gov­ern­ment of France is doing “extor­tion,” [47] and warns of the long-term risk of Google acced­ing to such demands that it pay for the sim­ple act of link­ing and excerpt­ing con­tent:

“There is lit­tle evi­dence to sug­gest that ‘pay­ing off’ a par­ty mak­ing unrea­son­able demands will do much more than qui­et them for the moment, and they’ll almost inevitably be back for more. And more. And more. Even worse, cav­ing in such sit­u­a­tions sig­nals oth­er par­ties that you may be sus­cep­ti­ble to their mak­ing the same (or even more out­ra­geous) demands, and this mind­set can eas­i­ly spread from attack­ing deep-pock­et­ed firms to dec­i­mat­ing much small­er com­pa­nies, orga­ni­za­tions, or even indi­vid­u­als.

As my col­league Jeff Roberts not­ed in his post on the Google set­tle­ment, the French orig­i­nal­ly want­ed the com­pa­ny to pay as much as $100 mil­lion [46], and want­ed almost all of that to go into a fund that pub­lish­ers could use for their own pur­pos­es, rather than into ad buy­ing or oth­er joint ven­tures. And he also not­ed that with the lat­est deal — which comes on the heels of a sim­i­lar set­tle­ment with Bel­gium [48] — Google is send­ing a very obvi­ous mes­sage to oth­er coun­tries such as Ger­many that it is pre­pared to pay.

Google’s tac­tics set a dan­ger­ous prece­dent

This may make sense for Google, since it is try­ing to avoid as much lit­i­ga­tion as pos­si­ble, and wants to be on good terms with Euro­pean coun­tries (where it has already run into mul­ti­ple road­blocks and bar­ri­ers around ser­vices like Street View and pri­va­cy con­cerns [49]). But I think Wein­stein is right when he argues that this is only going to encour­age coun­tries like Ger­many — and plen­ty of oth­ers as well — to assume that if they push Google on the sub­ject of link­ing, they will get cash.

Google wants these pay­ments to be seen as a help­ing hand to pub­lish­ers, which is why the fund is described as ““sup­port­ing dig­i­tal pub­lish­ing ini­tia­tives,” [50],” and why it puts so much empha­sis on the strate­gic part­ner­ship angle. But regard­less of the pic­ture it is try­ing to paint, the set­tle­ment is being described by many as a “pay for links” deal, and that per­cep­tion is dan­ger­ous. As Wein­stein puts it:

“France’s com­plaints regard­ing Google relat­ed to activ­i­ties that are absolute­ly part and par­cel of the fun­da­men­tal and ful­ly expect­ed nature of the open Inter­net when deal­ing with pub­licly acces­si­ble Web sites [and its] suc­cess at obtain­ing finan­cial and oth­er con­ces­sions from Google asso­ci­at­ed with ordi­nary search and link­ing activ­i­ties sends a loud, clear, and poten­tial­ly dis­as­trous mes­sage around the plan­et, a mes­sage that could doom the open Inter­net and Web that we’ve worked so long and hard to cre­ate.”

In oth­er words, this issue is much big­ger than just Google. While it may serve Google’s pur­pos­es to set­tle with France and Bel­gium, and per­haps oth­er coun­tries as well, all that does is encour­age oth­er gov­ern­ments and com­pa­nies to see pay­ment for links as an appro­pri­ate strat­e­gy [51]. How long until U.S. news­pa­pers and pub­lish­ers start to argue the same thing? What about oth­er com­pa­nies? Direc­tor Har­vey Wein­stein (no rela­tion to Lau­ren) said in a recent inter­view that the U.S. should have leg­is­la­tion [52] to make this a real­i­ty — and Google is help­ing that kind of think­ing gain momen­tum.

...

And just a month after Google made that set­tle­ment with France big pub­lish­ers, Ger­many’s low­er house passed a bill sim­i­lar to what Axel Springer was ask­ing for but some­what watered down [53]:

Ars Tech­ni­ca
Ger­many wants Google to pay for news cita­tions, pass­es re-pub­lish­ing bill
Google can post “short excerpts” freely—but what that means, nobody knows
by Cyrus Fari­var — Mar 1 2013, 7:00pm CST

The low­er house of the Ger­man par­lia­ment, known as the Bun­destag, has approved [54] a new bill that would require search engines to pay a license fee for re-pub­lish­ing con­tent longer than “indi­vid­ual words or short excerpts.” The bill passed [55] by a vote of 293 to 243, with three absten­tions.

How­ev­er, the law does not define exact­ly what such a “snip­pet” would entail. For the law to take effect, it would need to be rat­i­fied [56] by the upper house of the Ger­man par­lia­ment, the Bun­desrat. By all accounts, this bill is a watered-down ver­sion of what had orig­i­nal­ly been lob­bied [57] for by the Ger­man pub­lish­ing and media indus­try.

...

Yes, the bill was a water-down ver­sion on what Ger­man pub­lish­ers asks for since it was some­what vague in terms of what con­sti­tutes a “snip­pet”. But now that the EU par­lia­ment and EU dig­i­tal com­mis­sion­er are open­ly pri­or­i­tiz­ing the pas­sage of some­thing sim­i­lar to this law, but for the entire EU, it’s look­ing like may find out soon! This “ancil­lary copy­right” law went into effect for Ger­many back in August 2013 [58]. It’s the same law that grants Ger­man pub­lish­ers the exclu­sive rights to com­mer­cial­ly exploit their prod­ucts online [11] and Google and oth­er search engines and ‘news aggre­ga­tors’ now have to pay a license fee to pub­lish­er if they list­ed more of an arti­cle than “sin­gle words and small­est excerpts” [11]. And as we saw above, it’s the same law that Axel Springer and oth­ers sued Google over when Google refused to pay the fees, lead­ing to Google drop­ping Axel Springer and oth­er plain­tiffs from Google’s search index­ing (and the sub­se­quent fee waiv­er issued by Axel Springer ear­li­er this mon­thth so Google would start link­ing to them again) [19].

11 Per­cent. Just For These Guys.
So how much are the pub­lish­ers hop­ing to get from Google if every­thing goes well for their in thi­er ancil­lary per­suits? Well, back in June, we learned anoth­er fun-fact about what we might expect from the EU’s copy­right regime: Sev­er­al Ger­man media giants, includ­ing Axel Springer (but not Spiegel Online, Han­dels­blatt, Sueddeutsche.de, Stern.de or Focus), sued Google, Yahoo, and Microsoft for 11 per­cent of their “gross sales, includ­ing for­eign sales” that come “direct­ly and indi­rect­ly from mak­ing excerpts from online news­pa­pers and mag­a­zines pub­lic.” [59] That 11 per­cent would pre­sum­ably be set aside for just those Ger­man media giants that par­tic­i­pat­ed in the law­suit. The rest of the EU will have to fight over the remain­in­ing 89% of Google, Yahoo, and Microsoft­’s “gross sales, includ­ing for­eign sales” that come “direct­ly and indi­rect­ly from mak­ing excerpts from online news­pa­pers and mag­a­zines pub­lic.”

Break­ing Up As A Last Resort. A Last Resort That Was Just Cho­sen
So some very sign­f­i­cant changes could be in store for the Euro­pean inter­net mar­kets and the US mar­kets based on Gün­ther Oet­tinger’s com­ments above about mak­ing US com­pa­nies abide by this new frame­work too. And why would­n’t this apply to the world? So we’re now look­ing at a new source of glob­al legal pres­sure to allow major pub­lish­ers to start charg­ing for news snip­pets. One of the fun parts about glob­al­iza­tion is the crap can get glob­al­ized too as laws get har­mo­nized and pub­lish­ers every­where would LOVE this.

And it’s not just a cut of the rev­enues from com­pa­nies like Google and oth­er ‘news aggre­ga­tors’ that are on the hori­zon for the inter­net. Back in July, the Finan­cial Times issued a rather inter­est­ing report sug­gest­ing that hint­ing at what else to expect: a 42-page inter­nal review of the Euro­pean Com­mis­sion’s probe into Google’s prac­tices by the Ger­man competition/cartel author­i­ty (the Bun­deskartel­lamt) sug­gest­ed that Google’s pro­posed set­tle­ment with the EU over com­pe­ti­tion con­cerns (a set­tle­ment that did not involve fees for snip­pets at all) was ade­quate and as far as EU law could go. But that ini­tial opin­ion by the Bun­deskartel­lamt was been clear­ly ignored [60]:

Finan­cial Times
Brus­sels reach­es legal lim­its on Google antitrust set­tle­ment

By Alex Bark­er in Brus­sels
July 21, 2014 4:56 pm

Google’s draft antitrust deal with Brus­sels reach­es the lim­its of what is allowed in EU law, accord­ing to a Ger­man pol­i­cy paper high­light­ing the con­straints on Euro­pean politi­cians rail­ing against US tech groups.

A 42-page inter­nal review by Germany’s com­pe­ti­tion author­i­ty, seen by the Finan­cial Times, offers a cau­tious assess­ment for min­is­ters seek­ing legal means to curb the clout of US inter­net com­pa­nies and safe­guard con­sumer data.

At a moment when Google is polit­i­cal siege in Ger­many [61], the Bun­deskartel­lamt offers qual­i­fied sup­port for the Euro­pean Commission’s heav­i­ly crit­i­cised probe into whether the US group rigs search results to divert traf­fic from rivals.

It argues that Google’s draft EU set­tle­ment [62] is a “suit­able approach to counter the bar­ri­ers to com­peti­tors” and says the com­mis­sion went as far as is pos­si­ble under exist­ing EU com­pe­ti­tion law.

The paper offers some leg­isla­tive options – at both nation­al and EU lev­el – to tough­en antitrust law and rein­force the Brus­sels’ draft pact, but warns that steps to break up Google and “unbun­dle” ser­vices would be harm­ful and mis­placed.

French and Ger­man min­is­ters have demand­ed Brus­sels tough­en up its planned set­tle­ment or serve charges against the US group. Yet Joaquín Almu­nia, the EU com­pe­ti­tion chief, is still expect­ed to push for the pact to be for­mal­ly adopt­ed this autumn if he thinks he can over­come reser­va­tions of some EU com­mis­sion­ers and a bar­rage of crit­i­cism from Google’s rivals.

Even if the search pact is adopt­ed, Mr Almu­nia has made clear to col­leagues that Google would face antitrust scruti­ny in oth­er areas – such as YouTube and its Android mobile oper­at­ing sys­tem – and poten­tial­ly face leg­isla­tive curbs over data pro­tec­tion or copy­right.

In May Sig­mar Gabriel, the Ger­man econ­o­my min­is­ter and vice-chan­cel­lor, called for rad­i­cal steps to curb its mar­ket pow­er [63], includ­ing as a last resort the pos­si­ble break-up of Google and its reg­u­la­tion like a util­i­ty. His inter­ven­tion came short­ly after the Bun­deskartel­lamt deliv­ered its paper to his min­istry.

...

Yes, back in May, Ger­man Vice Chan­cel­lor and Min­is­ter of Eco­nom­ic Affairs Sig­mar Gabriel called for rad­i­cal steps to curb Google’s mar­ket pow­er short­ly after the competition/cartel min­istry (the Bun­deskartel­lamt) made its 42 page inter­nal report rec­om­mend­ing the EU com­mis­sion’s anti-trust inves­ti­ga­tion accept Google’s pro­posed set­tle­ment over claims of unfair search results. On top of that, Gabriel also sug­gest­ed that Google might need to be reg­u­lat­ed like a util­i­ty.

A Search Util­i­ty?
Recall that EU dig­i­tal com­mis­sion­er Oet­tinger is already talk­ing about reg­u­lat­ing Google’s search results [15]. So what might a Google search reg­u­la­to­ry regime look like? Well, if the Euro­pean pub­lish­ing indus­try gets its way (which looks quite pos­si­ble at this point), reg­u­lat­ing Google search­es will involve reg­u­lat­ing Google’s search algo­rithms [12]:

Google should be reg­u­lat­ed like util­i­ties, say rivals

Mar­ket test­ing of Google reme­dies ends Thurs­day

By Jen­nifer Bak­er

IDG News Ser­vice | Jun 25, 2013 3:08 PM PT

Com­pa­nies who have been assess­ing Google’s planned reme­dies to anti-com­pet­i­tive prac­tices called on the Euro­pean Com­mis­sion on Tues­day to reject them and to con­sid­er reg­u­lat­ing Inter­net search.

Google has been under inves­ti­ga­tion by the Com­mis­sion since Novem­ber 2010 after rivals accused the search giant of set­ting its algo­rithm to direct users to its own ser­vices by reduc­ing the vis­i­bil­i­ty of com­pet­ing web­sites and ser­vices. It was also accused of con­tent-scrap­ing and impos­ing con­trac­tu­al restric­tions that pre­vent adver­tis­ers from mov­ing their online cam­paigns to rival search engines.

On April 25 Google pro­posed spe­cif­ic mea­sures to address these com­plaints and rivals and inter­est­ed par­ties were invit­ed by the Com­mis­sion to “mar­ket test” them. That test­ing peri­od ends on Thurs­day.

...

Google has pro­posed to label its pre­ferred links to its own sites in search results. But pub­lish­ers say that this will mis­lead con­sumers into think­ing these were some­how tai­lor-made results for search queries and inter­ests, there­by caus­ing even greater harm to com­pe­ti­tion.

Google also pro­pos­es to include links to rival search engines for spe­cial­ist restau­rant search results that gen­er­ate rev­enue for Google. Google’s paid-for ser­vices would be sep­a­rat­ed from gen­er­al search and treat­ed more like adver­tis­ing.

Final­ly, Google has agreed to remove exclu­siv­i­ty pro­vi­sions from all future con­tracts and any lega­cy adver­tis­ing con­tracts and will offer tools to pre­vent Web scrap­ing by allow­ing con­tent own­ers to opt out.

But many com­plainants who met in Brus­sels on Tues­day to present their posi­tion on the reme­dies said that search is such an impor­tant Inter­net tool that it should be reg­u­lat­ed like a telecom­mu­ni­ca­tions or elec­tric util­i­ties.

“Every­one relies on it,” said Weber. “Unfor­tu­nate­ly no one plan­ning the dig­i­tal sin­gle mar­ket thought that a sin­gle com­pa­ny would con­trol access to the Inter­net.” Google has 95 per­cent of the search mar­ket in the E.U.

...

Mean­while hun­dreds of pub­lish­ers and their trade asso­ci­a­tions wrote an open let­ter call­ing on Com­pe­ti­tion Com­mis­sion­er Joaquin Almu­nia to reject Google’s draft reme­dies com­plete­ly.

“As a min­i­mum require­ment, Google must hold all ser­vices, includ­ing its own, to exact­ly the same stan­dards, using exact­ly the same crawl­ing, index­ing, rank­ing, dis­play and penal­ty algo­rithms,” said one of the sig­na­to­ries, Hel­mut Heinen, pres­i­dent of the Fed­er­a­tion of Ger­man News­pa­per Pub­lish­ers.

Feed­back from the mar­ket test will be tak­en into account in the Com­mis­sion’s final analy­sis. How­ev­er, it is the Com­mis­sion that Google’s reme­dies must sat­is­fy, not any oth­er par­ty involved. If a solu­tion isn’t found, the Com­mis­sion could still fine the com­pa­ny up to 10 per­cent of its annu­al glob­al rev­enue.

“As a min­i­mum require­ment, Google must hold all ser­vices, includ­ing its own, to exact­ly the same stan­dards, using exact­ly the same crawl­ing, index­ing, rank­ing, dis­play and penal­ty algo­rithms.” What exact­ly will that entail? We’ll find out since all signs com­ing out of the EU par­lia­ment right now are that Google’s search­es are about to get reg­u­lat­ed [64]. Will search reg­u­la­tions be lim­it­ed to Google? With Google hold­ing 95% of the EU search mar­ket share it’s hard to see oth­er major com­peti­tors that are also in monop­oly ter­ri­to­ry. So the scope of these new search reg­u­la­tion will be some­thing to watch going for­ward in part because they might start off only impact­ing Google (and Google is easy to hate). But, with all Euro­pean pub­lish­ers push­ing to get exclu­sive rights to com­mer­cial­ly exploit their prod­ucts online [11] and extract fees for head­lines and snip­pets, we prob­a­bly should­n’t be sur­prised if this “reg­u­lat­ed search” ini­tia­tive does­n’t just include Google and if cat­e­gories of media of that involve licens­ing fees expands beyond just the news.

What Oth­er Types of Reg­u­la­tions Might Emerge? A Dif­fer­ent Kind of Shar­ing Econ­o­my?
So some very big changes are com­ing for how the inter­net func­tions. Giv­en Google’s gar­gan­tu­an size and the pro­found­ly scary amount of per­son­al infor­ma­tion the com­pa­ny is gath­er­ing on the glob­al pop­u­la­tion it’s not as if a reg­u­la­to­ry look at how a firm like Google han­dles are per­son­al infor­ma­tion and directs traf­fic across the web is inap­pro­pri­ate. But as we’ll see in this Out-Law.com [65] inter­view below, when Google’s indus­try rivals are basi­cal­ly writ­ing the news laws reg­u­lat­ing Google, maybe we should­n’t expect all those new reg­u­la­tions intend­ed to lim­it the col­lec­tion and com­mer­cial use and abuse of pri­vate data to apply to the entire indus­try. Maybe we should expect the oppo­site result [13]:

Out-law.com
Opin­ion on big data, pri­va­cy and com­pe­ti­tion may be lat­est mark­er in clos­er scruti­ny of Google, says expert

A new opin­ion issued by an EU watch­dog on ‘big data’, pri­va­cy and com­pe­ti­tion issues can be read as a “shot across the bows” of Google and oth­er large tech­nol­o­gy play­ers, an infor­ma­tion law spe­cial­ist has said.

01 Apr 2014

Lore Leit­ner of Pin­sent Masons, the law firm behind Out-Law.com, said that data pro­tec­tion author­i­ties (DPAs) in the EU are becom­ing increas­ing­ly frus­trat­ed with lim­i­ta­tions to their abil­i­ty to con­trol Google’s pow­er in col­lect­ing and using per­son­al data.

She said, how­ev­er, that the new pre­lim­i­nary opin­ion issued by the Euro­pean Data Pro­tec­tion Super­vi­sor (EDPS) has high­light­ed the poten­tial for EU scruti­ny of Google’s activ­i­ties to shift from an assess­ment of whether the com­pa­ny is com­pli­ant with EU data pro­tec­tion laws to whether the way Google gath­ers and uses per­son­al data gives the com­pa­ny advan­tages in a way that is in line with com­pe­ti­tion rules.

In his opin­ion, EDPS Peter Hus­tinx said that an inves­ti­ga­tion into the “costs and ben­e­fits” asso­ci­at­ed with the way com­pa­nies often pro­vide free ser­vices to con­sumers in exchange for the right to gath­er and use their per­son­al data is “over­due”. He called for DPAs and com­pe­ti­tion reg­u­la­tors to work clos­er togeth­er so as to help “stim­u­late the mar­ket for pri­va­cy-enhanc­ing ser­vices”.

...

Com­pe­ti­tion law spe­cial­ist Sam­my Kalmanow­icz of Pin­sent Masons said com­pe­ti­tion issues around how the use of per­son­al data is con­trolled has been dis­cussed pre­vi­ous­ly at EU lev­el, includ­ing when the Euro­pean Com­mis­sion assessed Google’s takeover of adver­tis­ing busi­ness Dou­bleClick in 2008.

How­ev­er, Kalmanow­icz said he expects com­pe­ti­tion author­i­ties to pay clos­er atten­tion to com­pe­ti­tion issues as the need to analyse big data becomes a more promi­nent part of doing busi­ness. He said com­pe­ti­tion law could be engaged in a vari­ety of ways.

“Reg­u­la­tors are like­ly to become increas­ing­ly inter­est­ed in the way com­pa­nies with sig­nif­i­cant mar­ket pow­er use per­son­al data and will be on the look out for activ­i­ties that could be said to con­sti­tute an abuse of mar­ket dom­i­nance and thus a breach of com­pe­ti­tion rules,” Kalmanow­icz said.

“In par­tic­u­lar, the impo­si­tion of restric­tions on rivals gain­ing access to con­sumers’ per­son­al data is like­ly to be scru­ti­nised close­ly as the data becomes an ever more impor­tant cur­ren­cy in pro­vid­ing bet­ter tar­get­ed ser­vices. Inter­op­er­abil­i­ty with com­peti­tors’ plat­forms and giv­ing con­sumers the right to trans­fer their data to rival ser­vices [66] will become more impor­tant for major busi­ness­es as a result,” he said.

An abuse of dom­i­nance can occur when a dom­i­nant com­pa­ny refus­es to sup­ply or pro­vide access to an essen­tial facil­i­ty. The expert said that busi­ness­es’ mere col­lec­tion and pro­cess­ing of per­son­al data may be scru­ti­nised by com­pe­ti­tion author­i­ties more close­ly in future “because big data may be con­sid­ered an asset giv­ing sig­nif­i­cant advan­tages”.

Kalmanow­icz also said that com­pe­ti­tion author­i­ties may also review how com­pa­nies involved in poten­tial merg­er deals can exploit the amal­ga­mat­ed per­son­al data records and whether the advan­tages that can be accrued by the merged enti­ty could raise bar­ri­ers to entry in cer­tain mar­kets, includ­ing adver­tise­ment, tech­nol­o­gy and inno­va­tion mar­kets.

“Infor­ma­tion is pow­er as ser­vices can be tai­lored bet­ter to con­sumers from analysing their per­son­al data,” Kalmanow­icz said. “Pro­posed merg­er deals may be affect­ed if they lead to a con­cen­tra­tion of a great vol­ume of per­son­al data or tools for analysing such infor­ma­tion so that the merged com­pa­ny has sig­nif­i­cant con­sumer insights. In such cir­cum­stances com­pe­ti­tion author­i­ties may, for exam­ple, require the data to be made avail­able to rival com­pa­nies if it is felt that such access is indis­pen­si­ble to ensure effec­tive com­pe­ti­tion and inno­va­tion.

...

Well, at least accord­ing to the com­pe­ti­tion law spe­cial­ist inter­view above, one of the areas the EU is prob­a­bly going to be look­ing at in this era of over­hauled data pri­va­cy rules is the pos­si­bity that major data aggre­ga­tors, like Google, that gain com­pet­i­tive advan­tages by hav­ing so much dif­fer­ent per­son­al infor­ma­tion on con­sumers might be required to make that data avi­l­able to rivals if the data is deemed indis­pens­able to com­pe­ti­tion and inno­va­tion:

...
Pro­posed merg­er deals may be affect­ed if they lead to a con­cen­tra­tion of a great vol­ume of per­son­al data or tools for analysing such infor­ma­tion so that the merged com­pa­ny has sig­nif­i­cant con­sumer insights. In such cir­cum­stances com­pe­ti­tion author­i­ties may, for exam­ple, require the data to be made avail­able to rival com­pa­nies if it is felt that such access is indis­pen­si­ble to ensure effec­tive com­pe­ti­tion and inno­va­tion.
...

In oth­er words, one of the mod­els that’s being looked at for firms like Google that might grow too big for com­fort (‘too big’ in terms of how much data they have on us) is to exam­ine how how so much data cre­ates new com­pet­i­tive advan­tages that make some data “indis­pens­able” and “to ensure com­pe­ti­tion and inno­va­tion” those data giants might be force to make the data avail­able to rival com­pa­nies. So it’s sort of the oppo­site approach to the ‘unbun­dle and break up Google’ approach. Almost the exact oppo­site approach. It’s pos­si­ble that the EU’s new data pri­va­cy reg­u­la­tions will ensure that what­ev­er shared with rivals does­n’t cre­ate new avenues for abuse, but is that’s a real­is­tic sce­nario giv­en every­thing we’ve seen?

So it’s going to be impor­tant to keep in mind that the con­cerns over data pri­va­cy can be in direct com­pe­ti­tion with con­cerns over indus­try com­pe­ti­tion. Indus­try likes hav­ing more con­sumer data. Con­sumers don’t. Yes, com­pe­ti­tion con­cerns can be mit­i­gat­ed by actions like break­ing Google up and forc­ing an unbundling of it’s ser­vices (since it’s the bundling that pro­vides so much of the addi­tion­al per­son­al data). But those com­pe­ti­tion/an­ti-trust con­cerns can also be addressed by forc­ing Google to share its infor­ma­tion with com­peti­tors if that infor­ma­tion is con­sid­ered nec­es­sary for com­pe­ti­tion.

And which approach is more like­ly now that we’ve seen how the pub­lish­ing indus­try and oth­er Google rivals are clear­ly influ­enc­ing the regulatory/legislative agen­da on this top­ic? Less data col­lect­ed for Google or more data shared by Google? Or why not both? Could­n’t we see both a push to break up/unbundle Google in Europe and attempts to force Google to share its cus­tomer info with rivals? Giv­en the rapid­ly chang­ing atti­tude to Google in Europe it sure seems pos­si­ble.

Isn’t This All Alarm­ing?
Giv­en that we’re now look­ing at a new EU-lev­el inter­net regime that might grant pub­lish­er such exclu­sive rights over their online con­tent to extract fees for head­lines and snip­pets, and giv­en that Google’s search algo­rithms could be reg­u­lat­ed and it could pos­si­bly be forced to give “indis­pens­able” data to rival firms, it’s becom­ing clear­er and clear­er that some poten­tial­ly scary new laws could be in the works that sort of trash­es the inter­net. Google-bash­ing is fun and healthy, but Google-bash­ing at the behest of a coali­tion of inter­na­tion­al pub­lish­ing giants that are just out to increase their own empires is dan­ger­ous. Espe­cial­ly if it involves new poli­cies that extent beyond Google.

Just imag­ine how that would change the inter­net if an inter­na­tion­al legal frame­work was set up that made it real­ly easy for web­sites to charge you for link­ing to their site with a lit­tle blurb. Because there’s no way this is going to be lim­it­ed to Google/Microsoft/Yahoo. Isn’t cre­at­ing a frame­work where every­one, big and small, has to pay pub­lish­ing giants for even the small­est bit of con­tent basi­cal­ly the dream of pub­lish­ing giants? So should­n’t we expect an extend­ed push get sites much small­er than Google to be forced to pay these snip­pet­ting fees too? That’s obvi­ous­ly the dream and the pub­lish­ers are obvi­ous­ly in the leg­isla­tive dri­vers seat with Ger­many, France, Bel­gium, and Space already pass­ing headline/snipper fee leg­is­la­tion. So why isn’t this a sign of things to come for every­one?

Isn’t this one of those poten­tial night­mare cor­po­rate ini­tia­tives that peo­ple should be start­ing to freak­ing out about? Just imag­ine how lame mak­ing web con­tent would get if the web­sites you link to with a snip­pet can come ask­ing for a chunk of your rev­enue stream. Con­tent pro­duc­ing media giants might LOVE that par­tic­u­lar world but is it real­ly good for every­one else? It’s the dig­i­tal play­ing field of dreams for Axel Springer: if you build [that legal and tech­ni­cal [67] frame­work] Axel Springer will come [and ask for a cut of your rev­enues if it’s an option [59]]. Sor­ry poor web­sites. No link-blurbs for you. Media giants should LOVE that world [68] but what about every­one else?

Soci­ety needs to fig­ure out how to dri­ve more rev­enues into the hands of small and mid-sized con­tent pro­duc­ers, not just the media giants although even the giants are dying these days. So some­thing clear­ly needs to change in terms of how con­tent pro­duc­ers are paid for their work, big and small. It’s a seri­ous cri­sis since soci­ety is just gets more insane the less qual­i­ty news soci­ety con­sumes. But is the Axel Springer plan that oblit­er­ates fair use and places a cost of cross-site link­ing real­ly going to do any­thing for the small and mid-sized con­tent pro­duc­ers and real­ly save the inter­net from the cor­po­rate giants? Are the non-huge con­tent pro­duc­ers all going to be get­ting rev­enues streams from Google and oth­er sites in some sys­tem­at­ic way? Maybe Google, with all its traf­fic info, can get into the fee col­lec­tion busi­ness for all the small-time con­tent pro­duc­ers that need to extract fees from all the small to large search/aggregation sites. For a fee, of course. Link­ing could get com­mer­cial­ized fast if the the giants get their way.

And if the frame­work is set up to make the ‘Google tax’ avail­able for all the lit­tle guys (which is only fair) won’t that same technical/legal frame­work that allows a large num­ber of par­tic­i­pants to mon­e­tize a sin­gle site’s link traffic/snippets now be in place to apply to a much larg­er group of web­sites hav­ing to pay those fees? And how broad­ly will the ‘news aggre­ga­tors’ license fees apply? Will big forums like Dai­ly Kos and Free Repub­lic get charged by EU pub­lish­ers in a few years? Drudge pre­sum­ably will fall under the ‘news aggre­ga­tor’ which could be hilar­i­ous­ly dis­as­ter­ous for US/EU rela­tions if the ‘Google tax’ on Drudge turns the right wing blog-o-sphere against the EU (since the US right-wing has been unusal­ly silent in its Europe bash­ing ever since the aus­ter­i­ty-regime took over).

So the mon­e­ti­za­tion of link­ing and snip­pets just might suck for almost every­one. Small and mid-sized web­sites might have to pay all link/snippet fees and change their struc­tures and code to adapt to the new legal frame­work. And small and mid-sized con­tent pro­duc­ers are like­ly to get a raw deal out of any gen­er­al com­pen­sa­tion frame­work. Or maybe sites will just stop link­ing to EU news which does­n’t help any­one.

Maybe it will turn out dif­fer­ent­ly. Maybe a robust, pop­ulist legal frame­work that pri­or­i­tizes the small and mid-sized con­tent pro­duc­ers and elim­i­nates the impact the small and mid-sized web­sites that might oth­er­wise be taxed. But it sure seems unlike­ly that Axel Springer and its coali­tion part­ners dri­ving this move­ment are going to vol­un­tar­i­ly lim­it their poten­tial cus­tomer fee base to Google and the oth­er giants. There are a whole lot of small­er web­sites that could be called ‘news aggre­ga­tors’ out there in inter­net land and those def­i­n­i­tions can be changed. What won’t be changed eas­i­ly once it’s set up (or ignored eas­i­ly), is an inter­na­tion­al frame­work for auto­mat­i­cal­ly levy­ing these fees.

Recall the words of the EU com­pe­ti­tion min­ster Gün­ther Oet­tinger [14]:

...
“We are seek­ing uni­fied data pro­tec­tion across Europe, one which Amer­i­can com­pa­nies will have to abide by as well. If this is not the case there is scope for puni­tive mea­sures and fines,” the dig­i­tal econ­o­my com­mis­sion­er warned. On the copy­right ques­tion he also said, slight­ly mys­te­ri­ous­ly: “We want Euro­pean copy­right leg­is­la­tion and we want com­pa­nies like Google to adhere to Euro­pean copy­right stan­dards. We have the legal juris­dic­tion for this and we want to bring a degree of fair­ness into the rela­tion­ship between the users, Google and its com­peti­tors.”
...

“A degree of fair­ness into the rela­tion­ship between the users, Google and its com­peti­tors” sounds nice, but keep in mind that bal­anc­ing “the rela­tion­ship between the users, Google and its com­peti­tors” isn’t going to be an easy or straight­for­ward process since the inter­ests of Google’s com­peti­tors and the inter­ests of its cus­tomers are often in direct con­flict with each oth­er. It’s not just “Google vs the con­sumer” and “Google vs its com­peti­tor” that we have to wor­ry about. It’s also “Google’s con­sumers vs Google’s com­peti­tors” and it’s not at all clear that the solu­tions being pro­posed by Google’s indus­try com­peti­tors aren’t going to be wild­ly in favor of Google’s com­peti­tors over every­one else.

If Google was a per­son it would be a shit­ty, manip­u­la­tive per­son like almost all large prof­it-ori­ent­ed cor­po­ra­tions [69], but Google’s cor­po­rate com­peti­tors are going to be awful too. That’s one of the meta-prob­lems of the day. So it’s not a bad sign to see a mega cor­po­ra­tion like Google get reined in, espe­cial­ly these days when cor­po­rate giants are have basi­cal­ly unchecked pow­er in the world. And the open ques­tion of how soci­ety should best deal with mass data aggre­ga­tors like Google is a fas­ci­nat­ing one that’s going to be asked over and over as time goes on. Sim­i­lar­ly, the ques­tion how best to save the news indus­try from the unre­lent­ing pres­sures the dig­i­tal land­scape and pay jour­nal­ists is also going to be asked over and over (hint: soci­ety would read the news more if peo­ple it worked less [70] and were paid more so let’s all sup­port work­ing less for a hope­ful­ly [71] san­er soci­ety).

But it’s a real­ly bad sign that slay­ing the Google Drag­on is being done by a coali­tion of pub­lish­ing giants that clear­ly want to use this ant-Google cam­paign as a tro­jan horse for laws [8] that would add licens­ing fees for “indi­vid­ual words or short excerpts” of third par­ty con­tent [53] and it’s going to be even worse if this same cor­po­rate coali­tion that’s try­ing to make Google get reg­u­lat­ed “like a util­i­ty” also man­ages to force Google to share infor­ma­tion with rivals deemed “indis­pens­able”. And yet, since the EU par­lia­ment sud­den­ly made it clear that very big changes for Google are com­ing and the EU indus­try is prob­a­bly going to be writ­ing the new rules, crazy pos­si­bil­i­ties like the forced shar­ing of Google’s con­sumer data could now be on the way [13].

If Axel Springer’s indus­try coali­tion is the knight that slays the Google Drag­on [8], the new post-drag­on era of peace and pros­per­i­ty in the King­dom of the Inter­net might give the inter­net more of a fas­cist feel [72] than one would have hoped for. That’s what hap­pens when the pub­lish­ing indus­try writes the copy­right laws and right now it’s look­ing like the Euro­pean pub­lish­ing indus­try is poised to write EU copy­right laws for the inter­net, a glob­al plat­form. As much as Google sucks, it’s just one part of the prob­lem when it comes to the cor­po­rate abus­es our dig­i­tal selves. There are oth­er parts of the prob­lem, and those oth­er parts of the prob­lem have their own solu­tions they would like to see imple­ment­ed like head­line and snip­pet licens­ing. If the Google Drag­on is going to be slain, the drag­on’s spoils [1] can either be shared amongst its com­peti­tors or shrunk entire­ly for every­one else’s sake. Google’s rivals clear­ly want to share in the spoils that come with slay­ing the drag­on. Beware of drag­on slay­ers bear­ing death cer­tifi­cates for the “fair use” angels too. Those kinds of brave cor­po­rate-tech­no-drag­on slay­ers might be car­ry­ing beasts of their own. Be afraid, be very afraid [73].

It’s too bad soci­ety is so cap­ti­vat­ed by evil drag­ons and their high­ly ques­tion­able slay­ers. An obses­sion with ducks would have been a lot health­i­er. [74]