Future of news hinges on definition of ‘fair use’

THERE is a fight under way that will have an enormous bearing on the future of the news industry in Ireland.

It will decide who owns each aspect of the work produced by journalists and whether another company has the right to profit from it.

The winning of it will rest on who will emerge with the right to distribute articles, and whether the lawful copyright of publishers has been ignored by internet search engines selling a service that gathers and displays links to someone else’s writing.

The dispute boils down to the phrase “fair use”. Is it fair to pay for the creation of a product but have to watch another company profit from your investment by using it to lure customers into its own service?

On the other side, is it fair to expect a company to pay a producer for doing it a favour by attracting potential customers and directing them to your product?

The first argument is the position of newspapers who hire journalists to publish news for which search engines like Google distribute links for free.

The second is the case that Google has successfully presented to several governments around the world to avoid being found liable for breaching the copyright of newspaper owners.

This year, the tussle started to come to a head in Europe. Google and France are locking horns over President François Hollande’s threat that he would force search engines to pay for the content.

Junior minister Sean Sherlock has already suggested the concept of fair use may be adopted here when the ongoing review of the copyright law is completed.

Mr Sherlock is expecting to receive a report on the copyright law review in March. He had already pushed out the initial deadline to the end of 2012. But due to the volume and complicated nature of submissions, this has now been put back again.

For the National Newspapers of Ireland a lot is at stake. It has prepared a submission to Mr Sherlock, which says that the “blatant disregard” for the copyright of publishers has drained resources from the industry.

The NNI calculated that its members invested €250m in technological changes in the past 12 years but were being savaged for it.

The NNI has said the problem is growing. Last year, 350,000 articles were circulated for free which would have carried a notional cost of €110m.

On this issue, Mr Sherlock and the review group will be watching what happens in France, and a similar dispute making its way through the German parliament.

Mr Hollande has set an end-of-year deadline for search engines to come up with a resolution, and in recent days Google has indicated it would be open to mediation.

Looking at the core business of Google is the best way to understand what has brought this fight about. The success of the search engine’s advertising model has been questioned, but the logic is simple.

Google makes money because people use its service to find material they are looking for within a chaotic internet environment.

Google tracks what people search for, develops profiles on users, and sells this as a product to allow advertisers target customers.

Traditionally, an advertiser would go to a newspaper, whose readers best reflect its target market, and take out an advert in a bid to catch the attention of customers.

Using search engine advertising is supposed to allow businesses to better target their message and get greater bang for their buck.

But the issue coming to the fore in France, Germany, and here is that newspaper content is part of the bait search engines like Google use to attract its customers.

The headlines, links, and story summaries are all the work of journalists who have been paid by a publisher who also met the costs of preparing and presenting it online.

But while these little teasers keep the browsing customers of Google happy, there is no return for the people whose investment made those links possible.

ONE OF the options the NNI is open to is licensing. This would allow companies to use and distribute newspaper content as long as they paid a proper licence fee. There would not need to be a transaction for every link displayed by a search engine.

The current copyright review is not a new argument. Google has sharpened its teeth in similar battles around the world and won.

It has already succeeded in getting the “fair use doctrine” adopted in many jurisdictions, and could well do so again when Mr Sherlock considers the report next March.

Newspaper publishers fear their ability to survive will be sacrificed in order to keep the internet search engines and social media websites sweet. These are rich companies willing to employ here and make Ireland a base for European business.

However, the copyright debate is happening in the context of an extraordinary crisis facing publishers in Ireland. Some of it was brought about by self-inflicted excesses and short-term strategies.

During the late stages of the boom, the effect of stagnant circulation levels was masked by bumper revenues from property and recruitment advertising.

However, during the same period, the industry began to see the emergence of a major rival that was happy not just to undercut newspapers, but to do so as a loss leader.

This is the operation of rte.ie.

It has become the largest media website in the country. It generates 117m page views each month and has seen a surge in demand for content to mobile devices.

Pat Rabbitte, the communications minister, has already dismissed suggestion that public interest journalism, even if it is produced by private newspapers, could benefit from the pot gathered through the television licence fee to fund RTÉ.

But this problem has become more focused due to the popular success, but commercial liability, that has been created with rte.ie.

Through its website, RTÉ has decide to give away much of the content that is produced and prepared with the support of the licence fee.

It is doing so at a time when it is sustaining heavy losses, attempting to dramatically cut its workforce, rationalise its services, and fill a hole in its pension scheme.

Private news organisations, be they print or online, do not benefit from the same, state-funded parachute.

There are 4,300 people employed by privately owned newspapers. The sector generates €830m for the economy.

In economic terms this also delivers back to the exchequer because, unlike free internet access, sales of newspapers result in Vat.

But are they a sacrifice the Government is willing to make to keep new friends in the internet space happy?

News: Rabbitte says no need for tougher media regulation

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