German Newspaper Publisher Trying To Bring Failed “Google Tax” To All Of Europe

Disruptive technologies are often met with lobbying efforts to block them by vested interests trying to preserve the status quo. One such example is the unsuccessful effort by taxi companies to use the law to hold back Uber’s advance, especially in Europe. Another is the European newspaper industry’s efforts to boost sagging revenues with strict “anti-piracy” laws that are effectively a “Google tax.”

The strategy of trying to force Google to pay publishers for their content, in the form of restrictive copyright laws, has been tried in Germany and Spain with unwelcome and unintended consequences for the publishers. In Germany, publishers saw traffic and ad-revenue declines; in Spain, Google shuttered its News site rather than be subject to the copyright scheme. It’s mysterious, then why the publishers are trying to expand this strategy to the entirety of Europe.

According to Politico, German publishing giant Axel Springer (which just spent $400+ million for Business Insider) is leading the charge to take the wrongheaded German copyright model to the entire Continent. The article states:

After months of intensive lobbying, the publishers are confident that the European Commission will in the next few months propose new rules to strengthen their bargaining power against the U.S. Internet giants, lobbyists for several of Europe’s leading newspaper owners said.

In recent discussions, aides to digital commissioner Günther Oettinger have indicated that the Commission will give the publishers more favorable terms as part of an overhaul of European copyright policy, the lobbyists said.

If the publishers get their way, Google will have to pay them whenever snippets of their articles appear on its aggregation sites — opening up a new source of revenue for the embattled media companies.

The decline of the traditional newspaper model took somewhat longer, for cultural reasons, in Europe than in the US. However, European publishers are now on the same downward revenue trajectory. Their effort to use the legal and regulatory apparatus to compel Google and others to pay for their content has already failed. It’s hard to overstate how misguided and unsuccessful these tactics have been.

If the European Commission does adopt a restrictive EU-wide copyright regime, it will likely cause the end of Google News across Europe, as it did in Spain. It will also harm homegrown European news startups that can’t afford to pay licensing fees. As with the German and Spanish examples, it’s more likely to harm publishers than to achieve the desired outcome.

This effort must be seen in the larger context of growing European anti-Google and anti-US tech company hostility. The recent European Court of Justice Facebook decision about Facebook and Safe Harbor data transfer rules is another example of this, as is a forthcoming overhaul of EU-wide data protection rules.

The news publishers incorrectly blame Google for their decline. Instead, they should be going “all in” on their digital and mobile strategies to rebuild or strengthen their direct relationships with consumers.