Backgrounder on EU Copyright Directive
EU Directive on Copyright in the Single Market 'Digital Use' Rights
Free linking to publicly available content using snippets is fundamental to how the internet is used.
The right to cite and link has become an essential part of how we communicate online, and is core to how citizens use blogging tools, social networking and social news services today.
The creation of a new neighbouring right would therefore be highly damaging to the public discourse, which is essential to maintaining a healthy democratic space in the EU.
In March 2016 the EU launched a public consultation  on the role of publishers in the copyright value chain, which posed particular questions concerning the introduction of a proposed new “neighbouring right”.
Subsequently, the EU proposed a new EU Directive on Copyright in the Single Market, Article 11 of which which would provide ‘press publications’ with new rights for the ‘digital use’ of their publications (known as ‘related rights’, ‘neighbouring rights’ or ‘ancillary copyright’).
NewsNow is concerned that such a new neighbouring right might lead to compensation being payable to publishers for the reproduction of titles, short extracts and/or excerpts (referred to below as “snippets”) of their web content. We have produced this document to explore these concerns.
We believe that such a new right would inevitably affect many online services making use of hyperlinks to third-party content, as well as their users, and that the impact would be largely adverse.
By hyperlink we mean a reference to (and address of) an online resource (e.g. a document on the web) that a reader or user can directly follow. A hyperlink consists of a web address (or Uniform Resource Identifier) and some link text or image (which may or may not have been copied from the addressed resource) that identifies the addressed resource in human -readable form.
Today, in the UK and elsewhere in the EU and the wider world, no special rights are generally required for the republication of snippets of web content. This has allowed a wide variety of online services and publishers across the EU to make wide use of hyperlinks in their content to refer users and readers to related and relevant web content, often employing snippets from the linked-to content as the link text.
By “linking services” we mean services and content providers that rely, in their content production systems, on the unfettered right to link to third-party copyright content using snippets of that content.
There exist a wide variety of such linking services today: news aggregators such as NewsNow and Google News; search engines such as Google and Bing; social networks such as Facebook and Twitter; social news platforms such as Reddit; collaborative content platforms such as Wikipedia; and bloggers and publishers such as The Guardian or Le Monde, who use links in the course of source citation generally and particularly when publishing round-ups and critiques; and free-to-web and paid-access versions of all of the above types of services.
All such services are known to produce content – web pages containing a combination of a variable amount of original content, and snippets linking to relevant related third-party content – and can thus reasonably be termed “content producers”.
The risks of attempts to target any new neighbouring right at particular types of linking services
- Should any new neighbouring right be framed in such a way that it would affect only certain types of linking services, this would likely create unfair, unreasonable and counter-productive distinctions between those services and others.
- All of the above types of linking services engage in forms of content aggregation when they publish web pages containing an array of relevant links to third-party content.
- Although there exist differences between the aggregation mechanisms behind social networking sites and aggregators (the former making heavy use of user-submitted links, the latter making heavy use of RSS feeds and scraped links), the similarities are more important than the differences. Today, not only aggregators like NewsNow and Google, but also social networking sites like Facebook, social news platforms like Reddit, collaborative content platforms like Wikipedia, and publishers (for example Le Monde , and The Associated Press ) use a combination of human editorial input and automated algorithms to produce content (and to filter out unwanted content).
The distinction made in the consultation questions between “publishers”, “publishers in all sectors”, “press publishers” and “others” therefore seems unclear and even arbitrary. Even if these categories could be distinguished, it remains unclear on what basis any new right should apply to some categories of organisation and not others, as opposed to the underlying activities of any or all organisations.
- Furthermore, how end users use these services to locate news relevant to them is substantially similar. In the case of all the types of linking service described above, users visit a web page on which they expect to find a combination of content and links relevant to a particular topic or search term, or personalised to their interests. Whether the page content is produced in response to entering search terms, by editorial or computer input, sourced via social means or through scraping is largely irrelevant to end users if the content meets their needs.
- As such, any attempt to make any new neighbouring right target only particular types of linking services risks targeting all linking services, including innovative publishers making use of technology to automate content production.
- It would also run a high risk of creating new uncertainty about the application of the law, creating a non-level playing field between content producers, unfairly discriminating against certain technologies, giving certain technologies an unfair competitive advantage and in effect expressing a legislative preference for some technologies or business methods over others, which should not be the province of the EU.
- Besides, many publishers also commonly aggregate and rewrite articles made freely available online by other publishers. It is not clear why or on what basis a distinction should be made between these activities, in extracting value from publicly available content, and those of aggregators, social networks, social news platforms and other linking services. Legislative attempts to distinguish between these linking services (or their activities) would inevitably be marred by serious loopholes.
- The existing attempt at similar legislation in Spain  has targeted news aggregation services (such as Google News and NewsNow), but not to our understanding search engines (such as Google search). It is also unclear from the wording whether the legislation applies to social networking sites such as Facebook and Twitter, yet to our knowledge no charges have been levied against either firm by Spanish collective management organisations (“CMOs”). This evidences how an attempt to make a neighbouring right target particular types of service may create uncertainty and unfairly discriminate against particular aggregation technologies.
General consequences of a new neighbouring right
Concerning the impact on linking services and end users, the introduction of any new neighbouring right would:
- Discourage linking wherever a charge would be expected or even feared.
- Expose potentially commercially sensitive information on what links are being published/shared to CMOs and consequently publishers.
Likely responses to charges expected or feared from linking
As a consequence of the charges expected or feared from linking, we foresee a spectrum of responses by parties affected by the new right, including:
- Reduction in linking by existing services.
- Shutdown or withdrawal of existing services such as Google News (as happened in Spain ), where the costs would be seen to have a significant impact on the commercial viability of the operation (all the more so in the cases of small or start-up entities, and non-profit entities like Wikipedia).
- Discouragement of innovators in the EU from creating new linking services, such as new aggregators, social networks and publishers.
- Discouragement of existing successful linking services from entering into the EU market.
- Reduction in linking by existing services to EU publications, as compared with those based in non-EU jurisdictions that do not implement a neighbouring right and/or that implement strong “fair use” provisions in law. This would serve to put EU publishers at a competitive disadvantage to non-EU publishers. For example, when similar legislation in Spain  came into effect in January 2015, NewsNow ceased linking to Spanish-based publications as a precaution, given the uncertainty about how the law would be applied, the costs that would be levied and the consequences on the commercial viability of continuing to do so.
- Educational institutions’ and researchers’ budgets would be diverted from actual research towards licensing. Researchers and journalists would be discouraged from citation and linking, making research papers and articles less informative and verifiable. Their works would be encumbered by the consequences of this right, making it harder for them to circulate their works.
- As a consequence of an increased cost-base, aggregators may be motivated to link to fewer (but larger/higher-profile) publications, to reduce their administrative overheads. By reducing competition and diversity in content production, this would be to the detriment of smaller publishers and end users.
Indirect and hidden costs to linking services
- There are considerable issues around the practicalities of assessing the charges that would be levied on linking services, in relation to the number of different links published or the number of times a given link has been published. In an extreme case, any affected service would need to count the links included on every web page they serve. In the case of highly dynamic services like aggregators, search engines and social networks, the overhead cost of maintaining these counts as well as developing the software to maintain them could be considerable.
- These indirect and hidden costs would further disincentivise linking in general, and would in particular further disincentivise linking to smaller publishers, since accounts would be simpler to keep when there are fewer parties. This would prejudice the interests of smaller publishers and would be anti-competitive.
Consequences for publishers and users/readers
The consequences of reducing the amount of linking performed by linking services include the following:
- Authors and publishers would lose internet traffic from other sites, and consequently brand exposure, audience reach, market share and ad revenue . It is highly questionable that these losses might be made up by compensation paid in respect of the neighbouring right. Resources available to employ authors and journalists would be diminished.
- Users/readers would be deprived of valuable tools for locating online content, or else have those tools significantly impaired by the reduction in number of links, reduction in range of links, and exclusion of links to content from EU publishers (in turn putting the EU at a competitive disadvantage as compared with other jurisdictions such as the USA that do not implement a new neighbouring right and/or that implement strong “fair use” provisions in law).
- A chilling effect on public discourse as a consequence of difficulties and/or costs in republishing statements made by public figures (e.g. politicians or business leaders), as reported in online publications. This de facto fetter on quotation would sit at odds with the right, which is long established under international copyright law and enshrined in national copyright laws around the world, to quote from works that have already been lawfully made available to the public, alongside other recognised types of fair dealing with copyright works. It would also run against the grain of the rulings of the Court of Justice of the European Union in Svensson (Case C-466/12) and subsequent cases, which have each affirmed a right to link to freely accessible content online. In this sense, a new EU-wide ancillary right for publishers would not be a “neighbouring right” at all: proper “neighbouring rights” sit alongside rights that are protected by copyright and run in parallel with them (such as performers’ rights in performances of authors’ works), but do not encroach on exceptions conferred under copyright law. So any new ancillary right of the type being considered would really be a tax or levy, but with a redistributive purpose that lacks a clear or coherent economic justification and stands to stifle freedom of communication.
- Making it difficult and/or costly to reproduce titles of works. Unlike other forms of snippet that can potentially be paraphrased by a human or computer algorithm, titles must remain unchanged to identify a work uniquely. Any disincentive to reproduce a title (as a result of a new neighbouring right) will lead to diminished exposure for works, and less traffic and reduced revenues for publishers and content creators.
- Compensation for linking (or other reproduction of snippets) as opposed to consumption of content creates a perverse incentive for publishers to generate content purely for the purposes of encouraging linking, rather than for the purposes of providing people with content they actually want to consume. Since any new neighbouring right would apply to snippets, compensation paid to publishers would have to be calculated on the basis of snippets reproduced and could not take into account the number of clicks that links based on those snippets might have received. This would benefit publishers producing large volumes of low -quality content at the expense of publishers that produce small volumes of high -quality content, and would thus create a perverse incentive in the market.
- It is far from clear whether any compensation payable to publishers as a consequence of a new neighbouring right would exceed the costs of collecting such compensation, given the difficulties inherent in assessing the charges that would be levied on linking services.
- In the case of an inalienable new neighbouring right, researchers, journalists and authors would be prohibited from allowing their works to be freely shared if they so chose. This would be anti-democratic. It would create a crisis for the authors of content already published under certain ‘Creative Commons’-style licences, including all of the content on Wikipedia. It would discriminate unfairly against those many authors who value gaining unfettered exposure of their works above monetary reward. It would represent an unreasonable interference in the right of authors and publishers to control their content and to conduct their businesses as they see fit.
The status quo
The status quo provides an environment that is highly supportive to publishers of all sizes, and particularly supportive to small and start-up publishers.
It facilitates conditions in which a diverse plurality of publishers can and does thrive, and through a variety of means. Some are funding freely accessible services through online advertising. Others have types of content that can be commercialised successfully behind a paywall, like thetimes.co.uk and ft.com, or through other subscription means via iTunes, Kindle or through paid apps. Others, such as The Guardian, Byline and publishers funded through Flattr, cultivate members and supporters who subsidise their operations, while allowing their content to remain publicly available.
NewsNow receives many requests from publishers – from small and start-up publishers right up to the level of national newspapers and TV news websites – for inclusion of snippets linking to their content in our services. For publishers included on our services, they tell us that the commercial benefit of our doing so is considerable.
NewsNow drives significant amounts of traffic to their websites, which they are able to monetise through the above methods as they see fit, and we do not charge anything in return.
The widespread adoption in recent years by publishers of computer-readable auxiliary content explicitly intended to facilitate the operations of linking services (META tags with descriptions, icons, thumbnails, microdata, content hierarchies, semantic HTML tags and the whole SEO industry) evidences publishers’ active encouragement of linking services under the current environment. Putting in place the systems and human processes required to generate those data requires significant investment by publishers, which they would not make without the expectation of a return well in excess of their costs. This shows that the traffic and brand exposure received through linking services is already financially beneficial for publishers.
EU plans to change the status quo
The EU Commission has recently stated that it will “aim to achieve a fairer allocation of value generated by the online distribution of copyright protected content by online platforms providing access to such content". 
We question the evidence base for the presumption that value generated by the online distribution of copyright-protected content is not allocated fairly today.
Fairness is highly subjective. Larger publishers tend to have suites of publications within their stable. They may have publications online as well as on paper. They may have established brands that are familiar to their target audiences. They may have considerable sums at their disposal to spend on marketing and advertising. As such, smaller and start-up publishers are often much more reliant than larger publishers on linking services for building their brand and audience, and would suffer disproportionately from any adverse effects of new neighbouring rights on linking services.
Publication of snippets by linking services does not substitute for publishers’ content, but generates additional exposure for it, and drives substantial and valuable traffic to it.
In the act of linking by using snippets, linking services do not in fact “make available” or “provide access to” third-party content. Rather, linking services provide the address of that content, and by using a snippet provide a helpful indication of what can be expected if the user requests that content from the publisher.
In summary, any new neighbouring right would not only be unnecessary, but also materially harmful to publishers, linking services and their users.
It would be unnecessary, since publishers already receive substantial traffic under the current legislative regime, which can be successfully monetised by the publishers.
It would be harmful, since there are serious difficulties in defining any new neighbouring right in a way that does not hurt the people that it is intended to help. It would be hard to define exactly to whom (or to what activities) such a right would apply in a way that will not be unfair or counter-productive. It would be hard to define how any compensation payable under such a right would be fairly apportioned and in a way that does not create perverse incentives and distort the market. By virtue of the difficulty inherent in defining or resolving these concerns, any new neighbouring right would be generally or vaguely worded and would consequently create more legal uncertainty for all parties rather than less, as compared with the status quo. This uncertainty, and the reduction in linking that any new neighbouring right would entail, would raise new and unwanted barriers between existing publishers and readers, as well as barriers to entry for both new linking services and new publishers.
Experiments in Germany and Spain with legislative attempts to introduce new rights affecting linking services (allowing publishers to opt out in the first case, and making it impossible for publishers to do so in the second) have been attempted. Neither experiment has been successful in achieving the intended objectives, i.e. of remunerating publishers in addition to the traffic that they received from linking services, without adversely impacting that traffic. Indeed, in both cases, traffic to affected publishers dropped sharply when the laws were introduced (and in the Spanish case, see ,  and  for further background). It would require a leap of faith to believe that introducing equivalent legislation on an EU-wide basis would have a different effect, rather than compounding the problems experienced by most interested parties at national level in Germany and Spain.
Even if these considerable difficulties could be surmounted, any new neighbouring right should be framed in such a way that publishers can opt out. Publishers should be the final arbiter of how or if their content is monetised. Many rely on the status quo for their livelihoods.
Some large publishers are adopting automation to produce content and to lower their cost base (see  and ). This further undermines the case that there is a need for a new neighbouring right to compensate publishers and to support their activities.
Instead of introducing a new neighbouring right, the EU should legislate to overrule ancillary copyright laws in Spain and Germany and to liberalise fair use across the EU. This would create greater legal certainty for publishers and linking services based in the EU and create a legal environment that would be competitive with other jurisdictions, such as the USA. In doing so, it would foster innovation and promote a dynamic, forward-looking European press.
Free linking to publicly available content using snippets is also fundamental to how the internet is used. The right to cite and link has become an essential part of how we communicate online, and is core to how citizens use blogging tools, social networking and social news services.
The creation of a new neighbouring right would therefore be highly damaging to the public discourse, which is essential to maintaining a healthy democratic space in the EU.
- Public consultation on the role of publishers in the copyright value chain and on the 'panorama exception', 23/03/16 (https://ec.europa.eu/digital-single-market/en/news/public-consultation-role-publishers-copyright-value-chain-and-panorama-exception)
- Nos robots rédacteurs collaborent avec Le Monde ("Our robot journalists work with Le Monde"), Le Monde, 05/04/15 (http://blog.syllabs.com/le-monde-elections-departementales-syllabs-robotjournalisme/)
- Taming the Wild West of Journobots by Vas Panagiotopoulos, How We Get To Next (https://howwegettonext.com/taming-the-wild-west-of-journobots-d685aa7a12d6#.b4qu765k0)
- BOE-A-2014-11404, V, Modificación del texto refundido de la Ley de Propiedad Intelectual (Modifications to Spanish Intellectual Property Law passed on 5/11/14) (https://www.boe.es/diario_boe/txt.php?id=BOE-A-2014-11404). Full text of law as extant (http://noticias.juridicas.com/base_datos/Admin/rdleg1-1996.l1t3.html#I1351)
[Translation of amendment to article 32.2]: “The making available to the public by electronic content aggregation service providers of insignificant fragments of content distributed in periodical publications or in periodically updating websites which have as their purpose information, creation of public opinion or entertainment, will not require authorisation, without prejudice to the right of the publisher, or other rights -holders to receive fair compensation. Such right will be irrevocable and will be effected via the intellectual property rights management entities. Regardless of the foregoing, the making available to the public by third parties of any image, photographic work or mere photograph distributed in periodical publications or in periodically updating websites will be subject to authorisation.
Without prejudice to that established in the previous paragraph, the making available to the public by providers of services which facilitate searching for isolated words included in the content referred to in the previous paragraph, will not be subject to authorisation or equitable compensation, so long as such making available is done without commercial ends and is strictly limited to that which is essential to offer search results in response to requests made by a user to the search engine and so long as the making available to the public includes [sic] a link to the original page of the content.”
- Google's announcement of the shutdown of Google News in Spain, 17/12/14: (https://support.google.com/news/answer/6140047?hl=es&authuser=0)
- Online Platforms and the Digital Single Market Opportunities and Challenges for Europe, 25/05/16 (https://ec.europa.eu/digital-single-market/en/news/communication-online-platforms-and-digital-single-market-opportunities-and-challenges-europe)
- A study commissioned by the Spanish Association of Periodical Publishers (AEEPP), Impacto del Nuevo Artículo 32.2 de la Ley de Propiedad Intelectual, 09/07/15, estimated the revenue impacts on the publishing sector of the introduction of the amendments to the Spanish law on snippets at €10m per annum, and found that smaller publishers have lost about 14% of traffic. The study estimated the economic cost to users (the opportunity cost of additional time spent locating relevant content in the absence of being able to find it via aggregators) at €1.8bn per annum. (http://www.aeepp.com/pdf/InformeNera.pdf)
A discussion in English of the study was published by ArsTechnica. (http://arstechnica.com/tech-policy/2015/07/new-study-shows-spains-google-tax-has-been-a-disaster-for-publishers/)
- A group of European publishers and publishing associations including the AEEPP, and the Italian Online Publishers Association (ANSO), wrote to the EU in December 2015 arguing against the introduction of a new neighbouring right, because of the impact they had seen of the above legislation. (http://www.aeepp.com/pdf/151204_Statement_on_Digital_Single_Market_FINAL.pdf)
- A year following the modifications to Spanish law on snippets coming into force, there was no evidence that it had been applied or that any fees had been collected (http://tecnologia.elderecho.com/tecnologia/propiedad_intelectual_e_industrial/balance-canon-AEDE_11_880180001.html):
“A fecha de hoy la reforma no se ha empezado siquiera a aplicar. Ninguna entidad de gestión (CEDRO u otra de nueva creación) ha aprobado unas tarifas aplicables ni ha empezado recaudar el canon. Tampoco ningún agregador de noticias del mercado (Menéame, Yahoo! Noticias, Feedly o Flipboard, si es que alguno puede ser considerado sujeto pasivo del canon) ha sido compelido, por el momento, a su pago.”
[Translation]: “As of today the law has not even begun to be applied. No collecting society (CEDRO or some other new entity) has approved any applicable rates or has started to collect fees based on the new law. Neither has any news aggregator in the market (Menéame, Yahoo! Noticias, Feedly or Flipboard, if any of these can be considered as being covered by the law) been compelled, for the moment, to pay.”
- Criticism from Spanish publishers. The organisation instrumental in lobbying for the law was AEDE, whose associates are listed here: http://www.aede.es/asociados/. All the major Spanish newspapers are on the list, including Grupo PRISA, which owns the daily El País. Despite his organisation’s membership of AEDE, the chief executive of PRISA, Juan Luís Cebrián, was reported to have sharply criticised the law
[Translation]: “According to Cebrián, the imposition of the "so-called canon AEDE" cannot be irrevocable, as it is a property right and hence revocable, and it should be left to the free choice of the media to charge for rights. The executive accused the Partido Popular government of following the German model for this right which didn't work in that country [...]
"While I am president of PRISA, none of the publications in the group will apply these charges", revealed Cebrián.”
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