How Europe Is Rewriting the Rules for Digital Media

Feb 13 2019, 9:29 AMFeb 13 2019, 2:18 PMFebruary 13 2019, 9:29 AMFebruary 13 2019, 2:18 PM

(Bloomberg) -- If you like watching videos on YouTube or reading news posted on Facebook -- and you happen to live in Europe -- your online experience could be in for big changes starting this year. The European Union is overhauling its copyright rules for the internet age to ensure fair compensation for artists and publishers. While content creators welcome the effort as overdue and well-intentioned, the law could unleash a host of unintended consequences.

1. Why is Europe looking at copyrights?

The EU is looking to modernize its copyright rules, some of which date back to 2001 -- before social media or streaming media really took off. The rise of the internet has opened up new audiences to publishers and content creators, but they’ve had difficulty negotiating favorable terms of use for their material with web giants like Alphabet Inc.’s Google. The concern is that companies like Google have profited from displaying content belonging to others -- such as on YouTube -- without paying for the use of the material. The new EU rules are meant to help copyright owners obtain remuneration for their content.

2. Why is it so controversial?

The new European Copyright Directive aims to create more opportunities to use copyrighted material for purposes of education, research and cultural heritage. But there are two provisions of the law that have sparked controversy and intense lobbying on all sides. The first is Article 11, which grants publishers legal rights to squeeze money from news aggregators and other platforms for displaying small fragments of their articles on their sites. The other is Article 13, which would require platforms such as YouTube and Vivendi SA’s Dailymotion to actively prevent copyrighted content, like songs or video clips, from appearing on their sites if rights holders don’t grant them a license.

3. What’s the issue with news aggregators?

Free-speech activists say that rules similar to Article 11 introduced in Germany and Spain in 2013 and 2014, respectively, failed to lift the fortunes of publishers and may have suppressed the choice of digital media available to the public. Google News pulled out of Spain entirely rather than pay for content. In Germany, Google still hasn’t paid any money to publishers based on the law and has been locked in a legal battle with them since 2014. Meanwhile, smaller publishers worry that if they can’t waive their right to compensation under Article 11, they could lose important referral traffic, given that Google and Facebook Inc. would likely only take up licenses with larger publishers.

4. What about the uploading provision?

The point of Article 13 is to get illegally-uploaded music and videos off the web. The concern is how to make that happen. Web platforms like YouTube would have to screen all uploads, thrusting them into the role of content police or even censors. To avoid legal liability, they’d likely block new and existing content with unknown or disputed copyright ownership. Yet even with hit songs, the precise rights holders can be unclear.

5. Who supports the EU’s plans?

Large publishers like Axel Springer SE and Hubert Burda Media say they need Article 11’s protections to end free-riding on their content, which has allowed tech giants to make billions in advertising indirectly supported by their material. Music companies and movie studios are solidly behind Article 13. IMPALA, the Independent Music Companies Association, says the rules will help the creative industry thrive by helping creators get their fair share of the value generated by use of their works online.

6. Who is opposed?

In addition to small publishers, Google and other tech companies have come out against the plans. Google has threatened to pull Google News entirely from Europe, depending on the final version of the text, and is blanketing Twitter and YouTube with ads urging viewers to fight the rules. Open-internet activists have also sounded the alarm. The Pirate Party’s Julia Reda, a German Member of the European Parliament, has been particularly outspoken, saying the copyright directive could restrict how information is shared, especially if it covers hyperlinks through the protection of individual words. The issue is starting to make waves outside Brussels: an online petition objecting to Article 13 has already gathered 4.7 million signatures.

7. Where’s this fight going?

The European Commission proposed the rules in 2016 and the European Parliament and the bloc’s 28 member states have since put forth their own positions, largely backing the legislation but with some adjustments. The three institutions are set to hammer out the conclusive version of the text as soon as Feb. 13. Even the smallest changes to the text’s wording could have a big impact and could decide, for instance, whether small web platforms have to invest in costly technology to screen users’ uploads. Once agreed, the rules enter into force some months after the full European Parliament and the bloc’s member states rubber-stamp the legislation.

8. Why is the EU getting involved?

The EU has been out front on a range of knotty issues concerning the intersection of technology and society -- from aggressive antitrust cases to its landmark online privacy rules introduced last year. The new copyright rules are part of a broader shift by the EU to force tech firms to shoulder more responsibility for what appears on their sites. Previous law protected web platforms from liability as way to help them grow in the early days of the internet. But now Brussels is rolling back those exemptions in certain areas, for instance, preparing rules that would fine companies if they fail to remove terrorism-related content quickly enough. Companies are also taking their own initiative in some cases: Instagram recently said it would ban graphic images of self-harm following a campaign by the parents of a British teenager who committed suicide in 2017 after viewing such material on the photo-sharing platform.