Nera Economic Consulting (2015)
|Nera Economic Consulting (2015)|
|Title:||Impact of the New Article 32.2 of the Spanish Intellectual Property Act|
|Author(s):||Nera Economic Consulting|
|Citation:||Nera Consulting (2015), Impacto del Nuevo Artículo 32.2 de la Ley de Propiedad Intelectual, Informe para la Asociación Española de Editoriales de Publicaciones Periódicas (AEEPP) (study commissioned by Spanish Association of Publishers of Periodicals AEEPP)|
|Link(s):||Definitive , Open Access|
|Key Related Studies:|
|About the Data|
|Data Description:|| In addition to some new data geared by Nera, most of the data is extracted from various existing studies.
In the main these studies take the form of natural experiments. They examine the effect the closure/suspension/interruption of aggregator services such as Google News in a number of territories including: France, Spain, Taiwan and USA has on traffic to news sites.
|Data Type:||Primary and Secondary data|
|Secondary Data Sources:|
|Data Collection Methods:|
|Data Analysis Methods:|
|Cross Country Study?:||Yes|
|Government or policy study?:||No|
|Time Period(s) of Collection:||
The Spanish Association of Publishers of Periodical Publications (Asociación Española de Editoriales de Publicaciones Periódicas) has commissioned NERA Economic Consulting to conduct an analysis assessing the impact of introducing new article 32.2 of the Spanish Copyright Act. Article 32.2 institutes a copyright fee to be paid by online news aggregators to publishers for linking their content within their aggregation services. Publishers cannot opt out of receiving this fee, and payments are to be made through a copyright collecting society.
NERA’s analysis focuses on the article’s effects on competition, primarily for the news aggregator and publication sectors, as well as for consumers (i.e., readers of digital media) and advertisers. The implementation of this fee was promoted by a small group of publishers affiliated with the Association of Publishers of Spanish Newspapers (Asociación de Editores de Diarios Españoles), despite opposition from many industry players.
The article’s main (theoretical) motivation is that aggregators are benefiting from the publishers’ efforts without remunerating them properly. This would be even more relevant since news aggregators represent competition for publishers, as they would be reducing the number of visits from those readers satisfied with the limited information in the links, thus reducing the publishers’ audience and, consequently, their advertising revenues.
Main Results of the Study
- The publishers’ inability to refuse the payment was justified to prevent what occurred in countries including Germany and Belgium, where a similar fee was implemented. News aggregators in those countries chose to exclude publishers from their services in order to avoid the fee. Once publishers noticed that they were losing traffic, however, they asked to be linked back without demanding any payment in retur
- Aggregators are complementary vs. competing services and convey more benefit to publishers than harm. This is especially true for small, relatively unknown publications, such as some native digital newspapers.
- This suggests that, rather than damaging publishers, news aggregators are beneficial in that they drive web traffic to the publishers’ sites that otherwise would not have consulted those sources of information. This is clearly a justification against instituting the fee, particularly since it would be easy for a publisher to prevent an aggregator from linking to its content. If this has not been the case, it is because aggregation services really represent a benefit for publishers. In fact, in recent years, many publishers have invested substantial technical and human resources to improve the positioning of their content within the aggregation services.
Policy Implications as Stated By Author
The study concludes that a policy intervention is undesirable. Rather, it finds:
- "… external intervention is not necessary and that solutions do exist for this alleged problem through bilateral negotiations between the parties. Indeed, this has occurred in countries including France, Belgium, and Germany, and at European level, where there have been attempts to implement a similar fee and where aggregators (particularly Google News) and publishers have reached “cooperation agreements.”
- " This analysis concludes that there is no theoretical or empirical justification for the introduction of a fee to be paid by news aggregators to publishers for linking their content as part of their aggregation services. Likewise, the arbitrary nature of the fee, which prevents publishers from opting out of receiving the payments, inflicts harm on a large number of outlets, particularly small publications. Moreover, the introduction of such a fee has a negative impact on competition, not just for the aggregator segment, but also for online publications and, ultimately, for consumers, including readers and advertisers."
- "Similarly, the modification of the law does not adopt a position of technological neutrality, and distorts the provision of content services from online newspapers. These effects have been already noted in the short term, even in the absence of a specific guideline. On the more distant horizon, the negative impact will be more significant, discouraging the development of innovative content and platforms in the ecosystem of online news consumption in Spain."
- "In light of these findings, it is clear that the reform followed the interests of a particular group of publishers which, given the deterioration of their business, sought to obtain an additional source of income from one of the Internet giants, even to the detriment of other publishers, to the development of the online new production and aggregation sectors in Spain and, ultimately, to consumers (including advertisers) and to social welfare."
Coverage of Study
|Level of aggregation:||News Websites|
|Period of material under study:||2015|