French Publishers Want In On German Plan To Force Everyone To Pay To Link To News

from the this-won't-end-well dept

We've been following (for years) this ridiculous German proposal to make sites that link to and/or excerpt tidbits from news websites to have to pay for the privilege of sending traffic to the sites. While it's a spectacularly short-sighted proposal that will lead to significant problems and costs (without much real benefit), it's no surprise that publishers in other countries are getting jealous and are seeking to get the same sort of deal. Apparently, the fact that this proposal is gaining steam in Germany has emboldened French publishers to start seeking similar rights in France with which they could demand that Google pay newspapers for linking to their stories with a snippet. In other words, these publishers see a chance at a cash cow from actual innovators, right into their pockets, if they can just convince the government that "well, Germany's doing it!!!"

Filed Under: aggregation, france, germany, links, payment

Under Logic Of German 'Pay To Link' Proposal, If A German Publication Wastes My Time, I Can Send Them A Bill

from the logic-failure dept

For quite some time now, we've been following the bizarre effort in Germany to establish "neighboring rights." This was a plan, first floated a few years ago, to force aggregators to pay to link to news sources. This year, that effort has really ramped up. In March, news came out that such a proposal was being written, and the first draft was released in June, horrifying many who actually understand how the internet works. Basically, if you make money (say via some ads on your site) and link to a source with a short excerpt, you would have to pay. This includes those who do so via their own blog or social network site. Quote an article on a Facebook account, which you also use to make some money (say to promote your business) and you may have to pay.

As is described in a recent comment from Mathias Schindler, who has been attending the various hearings on these neighboring rights proposals, this appears to be a misguided effort by publishers, who have failed to adapt, to capture revenue from anyone who incidentally profits from the information they provide:

"The publishers argued that the bank consultant was only able to advise his clients because of the journalistic work in the published article. So that means the publisher deserves a fair share of any money made from that scenario. This was the proposal from the start."

We've seen this kind of thinking for years, and it really represents a fundamental misunderstanding of economics, driven by a variety of false assumptions, including the idea that the only way to determine value or benefits is through monetary transactions. This is obviously crazy when you put things into context. At the very same time that these publishers are demanding payment to link to their content, they and others are paying search engine optimizers to get more links, recognizing that such traffic is important. Basically, implicitly they recognize that traffic, absent money, is valuable, but they're now trying to add money on top of that.

One of the most misunderstood aspects of economics is the allocation of benefits. It's all too common for certain players in a market to assume that they should accrue money for anyone and everyone who benefits from their work. But that is not only impossible, it would actually massively limit growth. Such "externalities" or "spillovers" (depending on which economist you're talking to) have a major impact on economic growth, which often comes back to help the originator of the work, even if they don't directly receive payments for it. The research of the "new growth" economists over the past couple decades have really zeroed in on how externalities from information, such as third party benefits, are the key ingredient in economic growth. Clamp down on that, and you clamp down on the ingredient needed for economic growth.

Of course, if you want to demonstrate the fallacy of the publishers' argument, it's easy: just flip the situation around. If the publishers truly believe that anyone who uses information found in a publication to profit owes them a cut, then what if information leads to a loss? Say that I rely on information in a German publication to make an investment in a company that goes out of business. Should the publisher now repay me for my losses? Taken to the logical extreme, that's exactly what the publishers appear to be arguing. Take it one step further: let's just say that the article I read in a German publication wastes my time and provides no useful information. My time is valuable, and they've now wasted it. By their own logic, should I not be able to send them an invoice for wasting my time?

Somehow, of course, that flip side of the equation never gets discussed. Because this is not about logic. This is about publishers who don't want to adapt looking for protectionism on the upside only, against actual innovators. That the German government appears to be treating such concepts seriously suggests a significant risk for Germany to end up putting a massive chill on innovation and economic growth, by trying to tax the very beneficial externalities of information in a manner designed solely to protect one side of the market for a group of businesses who are trying to stifle competition and innovation. It's a dangerous move by a government who should be encouraging innovation and growth, not stifling it.

Filed Under: economics, externalities, germany, pay to link

Porn Copyright Troll's New Tactic: Maybe Public Humiliation Will Magically Make People Pay

from the well,-that's-one-strategy dept

It's no secret that the real strategy of many of the porn companies who have turned into copyright trolls is to use public shame into the game as a way to pressure people into settling. As per usual, these companies almost never follow through on actual lawsuits against people. They do just enough to get ISPs to cough up identifying information and threaten to file the lawsuit. In some cases, the threat of having to fight a lawsuit is enough to make people settle (even if they're innocent). However, often enough, it seems that the companies know that merely the possible embarrassment from publicly claiming someone downloaded porn will make them settle. It seems that one German copyright troll, Urmann and Colleagues (U+C) is skipping the legal middleman, and is just going to start posting information it's collected on people it accuses of infringement directly on its website, hoping this will create incentives to pay up, without the company having to go through any actual legal process. Of course, threatening to expose information about you unless you pay up, sure sounds an awful lot like extortion...

The article also notes that some legal experts believe that this move will violate Germany's (somewhat strict) privacy laws. Either way, U+C claims that it has a list of 150,000 people who it wants to pay up. I actually wonder if a list quite that large actually makes it counterproductive. When you're in the company of so many people, perhaps it's not quite so embarrassing... Of course, given that, perhaps it's not surprising that U+C has indicated elsewhere that it's going to be releasing the info in drips and drabs, and will be targeting those who have the most to lose if it's exposed that they were downloading hardcore porn.

According to comments an Urmann insider made to Wochenblatt, the law firm is planning to target the most vulnerable people first – those with IP addresses registered to churches, police stations and – quite unbelievably – the embassies of Arab countries.

How nice of them.

Filed Under: copyright troll, germany, humiliation, publicity
Companies: u+c, urmann and colleagues

Germany Tells Facebook To Destroy Face Recognition Database

from the no-innovation-allowed dept

I've already noted that I don't understand the fuss over Facebook's facial recognition feature -- but plenty of people (including many of you) completely disagree. And, so do regulators in Germany, apparently. As they've suddenly re-opened their investigation of the feature (jumping on the bandwagon with Ireland and Norway) and told Facebook that it needs to destroy its database of faces collected in Germany, and change the system so that people have to opt-in, rather than opt-out.

Of course, I'm still wondering how this is different than existing tagged images. If my friend Joe "tags" me in an image, then Facebook already has that info. Is it that different if Facebook's system tagged me or if Joe tags me? Should Joe have to first get permission from me to identify me in a photo? That seems like a stretch.

Filed Under: face recognition, germany, privacy
Companies: facebook

Stupid, Antiquated German Regulations Mean Germans Couldn't Watch Our Google Hangout With Rob Reid Yesterday

from the stupid-regulations dept

Yesterday we did our live streaming interview with Rob Reid about his book, Year Zero, which was a lot of fun. During the course of the video, we discovered (via some tweets) that people in Germany were blocked from watching. As I said in the video, I assumed that this was part of the dispute in Germany between YouTube & GEMA, the German collection society that is demanding huge fees for any music that is played on YouTube. Because -- unlike every other major collection society -- GEMA had refused to come to the table to negotiate a license, YouTube ended up pulling basically all music videos in Germany. I thought perhaps something related to that was why Google Hangouts weren't allowed. Though, I couldn't figure out how that made sense, since we weren't playing any music (Rob's offer to sing, notwithstanding).

However, as pointed out by Ruquay K Calloway, the actual story may be more bizarre. While YouTube has been rightfully proud of launching Hangouts On Air (the feature we used to broadcast live) worldwide, Germany is actually missing from the big list.

It turns out that it may be a different ridiculous regulation, however. There's an old "broadcasting law" in Germany that was put on the books decades ago to stop pirate TV stations. And it says you can't broadcast to more than 500 people without a special license. And, because that's impossible for every one-off person seeking to use a tool like Hangouts on Air, it appears that Hangouts On Air is just off-limits in Germany. So, I'm sorry for all the Germans who wanted to watch the video live, but perhaps an effort should be made to wipe that silly rule off the books already.

Filed Under: broadcast, germany, hangouts, hangouts on air, rob reid, rules, youtube

GEMA Hikes Venue Performance Royalties 500%, Threatens Germany's Underground Club Scene

from the 'creative'-destruction dept

GEMA is killing the music industry. Despite needing artists to survive, GEMA seems particularly hellbent on destroying any venue these artists might use to make money in its quest to secure even more money. It takes a certain level of diabolical shortsightedness and greed to "elevate" yourself above the rest of the PROs into "Most Hated" status. Considering other PROs have done such endearing things as shakedown the Girl Scouts and non-profit charities for spare change, GEMA has its work cut out for it.

Maybe it's the famous German industriousness that has provided GEMA with the impetus to turn Youtube into a massive collection of "Sorry, this content is not available in your country" messages. Maybe it's some form of corporate sociopathy that has turned it into a self-destructive monster capable of destroying artists' futures in the name of artists' "rights."

The latest move by GEMA has sparked protests, a claim that most other PROs can't make. GEMA, in its infinite wisdom greed has decided that the underground music scene just isn't paying its fair share. The fix? Raise rates 1,400% and if a few clubs go under because of the hike, well, that's just part of the price of doing business.

GEMA, the organisation responsible for collecting mechanical copyright fees on behalf of some 65,000 artists in Germany, have announced a price hike which could spell the end for some of Berlin's most revered clubs. If the changes go unchallenged, the legendary Berghain - facing a fee hike of 1,400% - will shut after its NYE party this year; the similarly monolithic Watergate is likely to go the same way, claiming its mechanical copyright fees will be increased from €10,000 per year to €200,000.

As is par for the course in instances like these, it's all about "fairness" and "putting money in the pockets of artists." But like every other PRO, GEMA exists to collect fees and redistribute them to the artists, starting at the top. Those most heavily represented by chart success, airplay and radio exposure get the largest chunk, with little to nothing reaching those artists operating outside the mainstream (like, say, THE UNDERGROUND), many of whom may not even be registered with GEMA.

Ostensibly, GEMA is attempting to streamline its fee structure, but doing so in such a way that the most direct beneficiary is GEMA itself. On top of that, an additional levy targets underground clubs, and their lengthy events, nearly exclusively:

In the new scheme, commencing 1st January 2013, the complex existing system of eleven different fee structures is being replaced with just two: monthly charges will be calculated as a percentage of ticket price and relative to the size of the venue. There will, however, be a 50% surcharge if events last longer than five hours, and a similar increase after another three hours. Der Spiegel calculates that, "for an average Berlin club with 410 square meters of space, charging €8 entrance and running two events per week from 10 p.m. until 5. a.m, the price paid to GEMA will rise from the current €14,500 to some €95,000 - an increase of 560%". It seems evident that these plans favour venues (such as bars and gig spaces) with shorter opening times, placing a disproportionate financial burden on clubs. Legendary spots like the Berghain, renowned for the kind of marathon all-weekend sessions largely prohibited in the UK due to stricter licensing, will fare the worst.

GEMA has it all figured out, though. You can nearly hear the condescending smirk wrapped around this statement by Regional Manager Lorenz Schmid.

"The way I see it, [clubs have] been paying far too little in the past. I see no problem for a club manager if he has to pay €1.20 out of €12".

Of course you think it's manageable. You're the one collecting the fees. When you're on that end, it all seems like a drop in the bucket. Those on the other side see it differently. It's another unexpected cost to factor in, and when you're running a club that caters to the underground, you don't really enjoy the sort of profit margins that more mainstream events and entities do. GEMA is killing off some of the few outlets for underground artists in order to further reward the top of the heap. Makes sense. Fortunately, the underground scene isn't taking this lying down.

The Berlin community isn't taking the change lying down: on 25th June, 5,000 gathered to protest outside GEMA's summer party; on the 30th, more than 2,000 clubs across the country stopped the music for five minutes to raise awareness of the new fees... High profile artists including Alec Empire, Blawan, The Black Dog, Mike Paradinas and Steffi have spoken out against GEMA's plans. The German patent office are apparently investigating the legality of the scheme, but they won't reach a decision before the fees come into effect - which may be too late for many of Berlin's clubs.

There is also an online petition, which you can sign here. Given the historical importance of Germany's underground club scene, as well as its contribution to Germany's tourist industry (more than 35% of visitors cite the city's nightlife as a major reason for their visit, according to the Guardian), it would be incredibly disappointing to see it killed off by a rent-seeking agency looking to further reward the top 5% of artists. Maybe this backlash will highlight the stupidity of destroying outlets for artists in the name of "protecting" artists.

 

Filed Under: collection society, copyright, fees, gema, germany, rates
Companies: gema

French & German Courts Disagree Whether Internet Companies Need To Filter

from the still-not-clear dept

Recently, Techdirt reported on the ruling by a German court on the issue of filtering -- whether Internet sites have a responsibility to block files continually if they have been notified about infringing materials once, sometimes called "Notice and Stay Down". The German court basically said they do, but the highest French court has taken a different view (French original.)

The Court of Appeal in Paris had ruled that Google had a duty to make sure that an unauthorized copy of a film was not re-posted to YouTube after it had been removed following a complaint. However, the Court of Cassation, the court of final appeal for civil and criminal matters in France, struck down this judgment. Its logic was as follows: if a Web site were expected to take down every future copy of a file that had been removed following a complaint, but without being told exactly where the new copies were located, the only way it could achieve that was by constantly monitoring all users to check that they were not uploading that file. That, the Court of Cassation ruled, was not proportionate and, furthermore, forbidden by European law (presumably a reference to the SABAM ruling from earlier this year.)

That's the good news. The bad news is that HADOPI threatens to rear its ugly head here. According to the same post on the French PC Inpact site, Article L336-2 of the HADOPI law introduced an extremely broad duty to do everything possible to stop copyright infringement. Quite what that means in practice has never been tested, but following the Court of Cassation's rejection of filtering, it seems likely that we shall find out soon enough.

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Filed Under: copyright, filters, france, germany

German Supreme Court Suggests Cyber Lockers Need To Filter Content If Alerted To Copyright Infringement

from the how-does-that-work? dept

A few years back, Megapuload and Rapidshare were often discussed in the same breath as the "big" cyberlockers for sharing content. However, over the last couple years or so, Rapidshare has made a concerted effort to make it clear that its service is not designed for sharing infringing works, and to make it more and more like a Dropbox-type offering. If you look at the cyberlockers that the MPAA complains about these days, Rapidshare is no longer on the list and is rarely discussed. The company has bent over backwards to show that it's a "good guy" in the space, and shouldn't be accused of being a "rogue site." Of course, that hasn't stopped some of the lawsuits. Following a confusing, mixed ruling in one, there's now been another confusing and mixed ruling at the federal Supreme Court in Germany.

The ruling basically found that RapidShare is not liable for uploads directly, but if it's told of an infringing file, it should have a system in place to prevent that file from being uploaded back into the service. It sounds like the courts are magically deciding that if you host any kind of user-generated content, you have to have a filter in place that consistently blocks content once it's been indicated as infringing. That seems problematic for a few reasons. First, the context of a file being uploaded matters a great deal. As we've seen with Viacom, one person's infringing upload may be the same company's attempt at viral marketing. Doing a full-on block may block legitimate content. Furthermore, the context of the usage seems to matter quite a bit. A short clip with commentary could be fair use, but also could be blocked under such a system. Requiring a filter could also be quite expensive.

On top of that, Rapidshare is focusing more on personal backup, and there are lots of cases where a personal backup isn't infringing, but the system the court is requiring could block such uses. While the judge apparently dismissed this concern because of Rapidshare's name ("The service is called RapidShare and not RapidStore... and that says it all.") that's really troubling. Just because the company is called "RapidShare" it does not mean that's all the company can do. Lots of companies change over time, and it's a little crazy for a judge to hold them to exactly what their original name says.

Either way, the court has sent the case back down to the lower court to determine if Rapidshare had successfully blocked repeat infringement, so this case is far from over...

Filed Under: copyright, cyberlockers, filters, germany
Companies: rapidshare

University Sues Student For Graduating Too Fast

from the don't-expect-an-alumni-gift dept

Here's an odd one. The School of Economics and Management in Essen, Germany is suing former student, Marcel Pohl, for graduating too quickly. You see, he finished all of the necessary exams for both a bachelor's and master's degree in 20 months -- representing three semesters. Normally, it takes students 11 semesters, and the school feels ripped off. The complaint is that, even though they charge per semester, what they're really charging for is the degree, and Pohl didn't pay enough for his. So they want another €3,000.

Of course, in the details, we learn that part of the reason he was able to take so many exams is that he teamed up with two friends and they all traded notes on classes they didn't actually attend. You can question whether or not that meets academic ethics requirements, but the fact is that Pohl still did pass the required exams, and met all of the qualifications to graduate -- and the University apparently let him graduate before it realized what happened. It's hard to see what the legal issue is here. Perhaps instead of suing, they should look at their own setup and question why they force students to spend 11 semesters on material when at least some can get through it all in about a quarter of the time...

In the meantime, was there really no one at the school who didn't think that the cost of legal fees and negative publicity combined is very likely to exceed the money they're seeking?

Filed Under: essen, germany, marcel pohl, university

Proposed Licensing For Newspaper Snippets Could Threaten Users Of Blogs, Facebook And Twitter In Germany

from the triumph-of-the-dinosaurs dept

A few months ago we wrote about a really bad idea that was being floated in Germany: making companies like Google pay for the use of news snippets in services such as Google News. Unfortunately, that idea has now been turned into a concrete proposal for a new law; remarkably, it is even worse than the original plans.

As Udo Vetter points out in a post entitled "Digitally Castrated" (German original), the emphasis of the proposed modification to German copyright law (available as pdf) has shifted: now the primary targets of the law are not only companies like Google, but also ordinary people who blog or post short excerpts of news stories on Facebook or even Twitter, who may be required to obtain a special new license to do so.

Vetter suggests this is because the German publishers have realised that Google would probably rather close down its Google News site in Germany than pay for each snippet, and so they have decided to go after an Internet group who make up in numbers what they lack in revenue: German users of blogs, Facebook and Twitter.

They are likely to be affected because two aspects of the proposed law are vague. It would apparently apply to anyone who makes money from their online writing, and that seems to include things like a few Google Ads or a micropayment system like Flattr. The other uncertainty is what exactly is allowed in the way of unlicensed excerpts from articles. The proposal explicitly mentions that quotations that are currently legal will remain legal. But as Vetter points out, a recent German court decision established that even very short excerpts could be infringing, which effectively guts that apparent safeguard.

This creates a gray area of what will be lawful for ordinary Internet users. And that, in its turn, will create an opportunity for publishers to send out huge numbers of threatening letters to bloggers and others that have quoted from newspapers and magazines. Since few of the latter will have the resources to defend themselves in court, most will simply give in and pay for one of the new licenses the legislation would create.

This will doubtless have a chilling effect on German blogging, and by extension on the use of quotations from newspapers in German Facebook posts and on Twitter too, since users will hardly be keen to fight major battles against well-funded publishers to establish the exact contours of the new law.

The end-result could be a disaster for German blogging, microblogging and social networks. Freedom of speech would inevitably suffer, as people hesitate to challenge articles published in newspapers and magazines for fear of running afoul of the new rules. Old media will be back in the driver's seat -- exactly as the publishers doubtless planned when they lobbied for this law.

One hope is that the extreme nature of this proposal will shock enough people into protesting against it -- the massive street demonstrations against ACTA showed what the German Internet community is capable of. The other is that, if the worst comes to the worst, and it is passed in its current form, the new copyright law would surely alienate so many users of popular platforms like blogs and social networks that the German Pirate party would find itself propelled to even greater political power.

Follow me @glynmoody on Twitter or identi.ca, and on Google+

Filed Under: germany, google news, licensing, newspapers
Companies: facebook, flattr, google, twitter