A conversation about digital copyright reform – TechCrunch
The European Union is in the process of reforming copyright laws that date back to 2001, as part ofÂ a wider strategy to establish a Digital Single Market across the 28 Member States of the bloc, aiming to break down regionalÂ barriers toÂ ecommerce.
Earlier this year an agreement was reached on ending geoblocks on travelers digital subscriptions by 2018. And EU consumers are set to say adios to mobile roaming fees from this June. So far so good, you couldÂ say.
ButÂ when theÂ European Commissionâs draft proposals for digital copyright reform were published last September they wereÂ criticized by tech companies as regressive,Â and by copyright reformists as a missed opportunity to modernize ill-fittingÂ lawsÂ to make themÂ fit for purpose in the Internet age.
There have also beenÂ warning of theÂ potential impact on startupsÂ of the copyright reform, although itâs fair to say that the loudest complaints areÂ coming from big US tech companies who appear to be coreÂ targets in the European Commissionâs draft proposal, on account of the size and power of their content sharing platforms.
InÂ the supportersâÂ camp, EU sources argue thatÂ the Commissionâs proposals willÂ help European creative and copyright-centered industries flourish in a Digital Single Market, and European authors reach new audiences â while making regionalÂ works widely accessible to EUÂ citizens and across borders.
âThe aim is to ensure a good balance between copyright and relevant public policy objectives such as education, research, innovation and the needs of persons with disabilities,â one EU source told us.Â âWe trust that the discussions in the Council and the European Parliament will aim to maintain this ambition and will facilitate access to and use of copyright-protected content online and ensuring a well-functioning copyright marketplace.â
At the launch of the draft proposals last year, Andrus Ansip, VPÂ for the Digital Single Market, summed up the balance the EC is seeking to strikeÂ thus:Â âEuropeâs creative content should not be locked-up, but it should also be highly protected, in particular to improve the remuneration possibilities for our creators.â
Neighboring rights for news
Among the most controversial elements of the proposals are an extra copyright provision for using snippets of journalistic content online â a so-called âneighboring rightâ for news sites, which critics describe asÂ an attack on the hyperlink.
ThisÂ couldÂ apply to link previews generated by news aggregators like Google News, for example, orÂ social network sites like Facebook linking out to news articles. But there are also suggestions it may disproportionately impact startups in theÂ news aggregation and/or media monitoring space.
Although EU sources emphasize there is no requirement thatÂ publishers levy a charge for their content â rather it is up to publishersÂ to decide on conditions for use of their content, with the argument being that the neighboring right would give publishers a stronger legal basis to negotiate with third parties.
A similar law was enacted in Germany in 2013, but uncertainty remains about what actually constitutes a snippet â and local publishers ended up offering Google free consent to display their snippets after they saw traffic fall substantially whenÂ Google stopped showingÂ their content rather than pay for using them.
Spain also enacted a similar ancillary copyright law for publishers in 2014 but its implementation required publishers to charge for using their snippets â leading Google to permanently close its news aggregation service in the country. A subsequent economic study found theÂ significant drop in traffic associated with the shuttering of Google News in Spain mostly affected smaller, niche or newcomer publishers. But even large media entities there have come out againstÂ the law.
Another highly controversial portion of the copyright proposal is a requirement on websites that host large amounts of user generated content to monitor user behavior to identify and preventÂ copyright infringement. So, in other words, to shiftÂ from reviewing reportedÂ content after its been publishedÂ to proactively scanning at the point of upload to try to prevent copyright infringementsÂ happening in the first place.
Critics complain this approach wouldÂ compel private companies to police the Internet on behalf of rights holders. They also suggest itâs a surveillance risk and that requiring indiscriminate monitoring of citizensâ online activity is disproportionate andÂ therefore potentially violates fundamental EU privacy rights.
Countering these criticisms, EU sources emphasize that the Commissionâs proposals areÂ specifically targeted at services that store and give access to âlarge amounts of copyright protected contentâ â pointing out that such platforms have become important players on the content market.
âDue to the nature and significance of these services for the distribution of copyright protected content, they are required to take certain measures to allow a better functioning of the content market,â one source told us.Â
Measures taken must also be âproportionateâ, and should not be âunnecessarily complicated or costly for the service providersâ, according to theÂ source. Nor are specific technologies or solutions imposed.
âIt is for the services to find the appropriate and proportionate measures, which could be developed either internally or using for example third party services, as done by a number of services already today,â the source added, arguing that the proposal âstrikes a balance between different interestsâ.
âIt imposes obligations on platforms with large amounts of copyright protected content, which can be expected, due to their role on the content market, to have certain responsibilities. It also introduces safeguards for businesses and users. It does not introduce a general obligation to monitor content.â
Text and data mining
The copyright reform also proposed to establish a new EU-wide exception for text and data-mining â but only for research institutions conducting scientific research, which has raised questions over whether commercial data mining activity might suddenly be considered to lie outside the law.
Responding to this concern,Â EU sources argue thatÂ the proposal does not regulate or extend access to data for any stakeholders, nor does it change the current situation for other users of text and data miningÂ â adding that these usersÂ âcan continue exercising their activities under the same conditions as todayâ.
There has also been disappointment among copyright reformists that the ECÂ has not soughtÂ to harmonize rules across the EU to recognize and put beyond legal doubtÂ digital remix culture, such asÂ the ability to create GIFs, memes, supercuts etc â types of digital contentÂ which may currently at least technically beÂ copyright infringements in some EU Member States.
The European Parliament has been debating the copyright reform proposals for the past few months, as it formulates its official reaction to the draft proposals and seeks to push for specific changes. And this week Members of the European Parliament submitted their amendments to the Commissionâs proposals, as part of that process.
TechCrunch spoke to MEP Julia Reda, a long running proponent for copyright reform â who has calledÂ for bold and ambitious reforms yet instead findsÂ herself fighting a set of proposals that she argues couldÂ usher inÂ additional restrictions on web users â while also disadvantagingÂ regional startups.
TC: What was the original impetus for the EUâs digital copyright reform, and what did the Commission eventually propose?
Reda: When EU first announced the copyright reform it was saying that the purpose was to really make life easier for everybody â businesses who wanted to scale up throughout the entire EU but also for citizens or consumers who wanted to access different services across borders. And what would be needed for that would be a more European copyright. Weâre currently stuck with 28 different national laws that are often contradictory and thatâs often causing problems in the online environment. So when the Commission came out with this proposal there was very little of this ambition to be found. There are a few exceptions that the Commission is proposing to make mandatory across the EU when it comes to teaching â so use of digital content in teaching, and preservation copies being made by libraries and archives but this is really â while itâs a step in the right direction it doesnât really do much more for the market.
At the same time when it comes to the measures that are proposed on the marketplace I think they are actively harmful, so on the one hand you have a provision that would force any company or not even company any host provider that is basically giving users the possibility to upload content on their own an obligation to monitor what the users are doing â and this is not only extremely costly for all the providers, it could be anyone from Wikipedia to Github to photo communities, but itâs also a violation of fundamental rights. In the past the European Court of Justice has made it very clear that Member States are not allowed to impose a general obligation on Internet providers to monitor what users are doing. And this is exactly what this law would do. But this is the one big criticism that I think is relevant when it comes to how this would affect the Internet ecosystem.
The other one is the proposal to extend copyright for press publishers and allow them to ask for licence fees for the reproduction of even the smallest snippets of content â so for example the headline of a news article. This directly interferes with the possibility to link to content on the Internet because of course if youâre linking to something you want the link to be meaningful, and at the very least to include the title of the article youâre linking to.
TC: HowÂ have we arrived here? Who most stands to benefit from theÂ most controversial proposals?
Reda: I think both of these proposals are examples of really blatant industry lobbying. So in the case of these content monitoring provisions, this has been very clearly pushed for by the music industry. And itâs actually a parallel development to the discussions that are going on in the US. So the music industry has quite successfully convinced a lot of lawmakers that they basically need to be paid more by YouTube. The entire purpose of this article is really to settle a fight between music labels and YouTube. The problem with this proposal is of course that its effects would go far beyond YouTube. And in fact probably YouTube would be one of the only hosting websites that could easily comply with this website because they already have a content monitoring facility in place. So even though itâs intended to strengthen the position of the music industry when itâs negotiating with YouTube, probably the collateral damage on other hosting websites would be a lot higher. But this is simply not something that the Commission has been thinking about when it was drafting this law. Itâs very clear that they had a very specific type of website and a very specific type of content in mind, where such automated filtering may be more realistically possible.
Because if youâre trying to find a music recording, at least technologically this is comparatively simple because a music recording is more or less unique. But copyrighted content is a lot more than that. And if, for example, software would have to detect any type of copyright infringement â which is basically what this law is saying â the technology for that doesnât even exist. So it could be things like being able to transfer to detect translations of a text that can be a copyright infringement, or pictures of a sculpture from different angles. It can be compositions rather than just musical recordings. So itâs really a huge technological challenge and itâs very clear from the fact that in all its reporting documents the Commission is only talking about the music industry that this is really what they had in mind. And there has been quite clear lobbying from the industry for this.
And in the case of the extra copyright for press publishers, itâs not even the publishing industry in general thatâs in favor of this. Itâs a relatively small number of â in particular two German publishing houses â that want to have this. And everybody else is a bit more puzzled by it. But because we had a German commissioner at the time that this proposal was being produced, they had very easy access to the highest levels of the Commission. But there are a lot of publishers who are actually quite critical of this proposal because they are saying that being able to be found on news aggregators and being able to be linked to by people on social media, is absolutely crucial to their business model and to finding their audience. So itâs not like the entire publishing industry is in favor of this either.
[In Germany an ancillary copyright] was passed into law in 2013, and since then there has been court battles going on about what it actually means. Like how many words are you allowed to use before it becomes an infringement? And none of these questions has been solved by now. But a number of startups who have been doing media monitoring and stuff like that have had to go out of business because of the legal uncertainty, and they just canât get funding â if they donât know whether what they are doing is legal. And theyâre probably not going to find out for several years.
TC: Setting aside the problem of a lack of ambition in the reform, it soundsÂ like it has been overly broadly drafted â- could the Commission fix what it has, or do you think it should be scrapped entirely?
Reda: I think it should be scrapped because thereâs not one problem with the proposal but several ones. So I think itâs a fundamentally bad idea to write content recognition technology into law. Not just because itâs extremely invasive but because it systematically ignores usersâ rights. So the way that copyright is designed in Europe is that we have exclusive rights, and then have a list of specific exceptions under which users are allowed to use copyrighted content. So, for example, in most member states of the EU you are allowed to use works for purposes of quotation, within certain limits of course. The technology is not able to distinguish between a lawful use of copyrighted content under an exception, and an unlawful use â- so it simply takes downÂ every use of the content that is not licensed. And this of course leads to takedowns of lots of EU content and it systematically undermines the purpose of the exception which is usually the protection of freedom of expression. So I think as long as this proposal talks about forcing anyone to use content recognition technologies itâs systematically undermining the copyright exceptions and itâs basically throwing the copyright system even more out of balance. So I find it very difficult to imagine how this could be fixed.
The other problem is that itâs trying to misrepresent the legal status of hosting providers in the EU. Because at the moment, if a user uploads something to a platform itâs primarily the user who is responsible for it, so they are the ones who have to check whether the content they are uploading is legal and so on â and this make sense because otherwise it wouldnât be possible to run a platform that has a lot of user uploaded content. If you had to check every YouTube video before itâs uploaded or every picture before it can be used on Wikipedia, these platforms simply wouldnât work the way that they work today. And so thatâs why there is a limited liability for these host providers that no they donât have to pro-actively check everything that is uploaded. But in return they have to take down content once theyâre informed, or once they learn that thereâs something illegal there. And theyâre doing this. So I think that as long as the proposal first of all doesnât recognize this legal regime and this limited liability, and at the same time speaks about content recognition, I donât see how it can be fixed.
TC: At the moment in the EU thereâs a lot ofÂ political pressure on social platforms to get better and faster atÂ taking down problemÂ content such asÂ hate speech, terrorist propagandaÂ and child abuse imagery â including governments talking about wanting the tech companies to build tools to help automate this process. Might this sort of thinking be feeding into the Commissionâs proposalsÂ on copyright too?
Reda:Â I think the problems associated with copyright infringement, with hate speech and with images of child abuse are fundamentally different. So first of all with hate speech the biggest problem is that according to numbers by the Council of Europe, only 15 per cent of hate speech is even illegal in the first place. So the companies are often being asked to take down content that is technically legal. And then of course itâs extremely difficult because then the problem is not that the companies are not complying with their obligations under the limited liability regime, but the problem is that the laws are not fit for purpose to actually address hate speech â- so there we have a problem, and itâs the problem with the criminal provisions in the Member States and not with the enforcement of the law by the platforms.
Then in the case of images of child abuse, itâs relatively clear â the legal situation is essentially the same all around the world. These images are illegal to spread and therefore if you have an exact copy of the same content then itâs very easy for a platform to say this is illegal, this needs to be taken down. And there I think the use of automated recognition of these images can be justified. And then it can be taken down at the source. The problem is this doesnât work for copyright because with the copyright exceptions, just because something is using copyrighted content does not mean that it is actually infringing. And the problem is of course if you start putting in place infrastructure for one type of content â perhaps itâs justified with terrorism â then there will invariably be a strong push to use it for all types of other content where it is not justified. And I think â well, there are lots of examples for this â but I think for copyrighted content these automated tools simply undermine copyright exceptions. And they are not proportionate. I mean we are not talking about violent crimes here in the way that terrorism or child abuse are. Weâre talking about something that is a really widespread phenomenon and thatâs dealt with by providing attractive legal offers to people. And not by treating them as criminals.
TC: How do you believe startups might be disadvantaged by the current proposals for the EU copyright reforms? Big companies like Google have some clear risks but also big resources to respond to new laws. What specific risks do you see for startups?
Reda: Thereâs a certain cognitive dissonance among a lot of the regulators in Europe because on the one hand they are kind of upset about the fact there are so few European startups and theyâre wondering how we can better compete with the US, but at the same time theyâre putting in place laws that are targeted at the big US tech giants but that actually end up hitting the domestic startups a lot harder because they have to comply with pretty strict regulations from the start that theyâre not equipped to actually deal with, and that often hampers their possibility to get funding.
I mean something that an investor certainly does not want to have is legal uncertainty. And a big flaw of the proposals that are put on the table by the Commission is that they are unclear. If you took, for example, the neighboring rights for press publisher by its word you would have to conclude that taking a single word, or even a single letter from a publication would be an infringement because, unlike copyright, neighboring rights do not have a threshold of originality. But at the same time of course common sense dictates that you cannot have an exclusive right on a single word or a single letter. So itâs clear that interpreting what exactly this law protects would be up to the courts. And probably the courts in different countries would come to different conclusions. So this is a huge source of legal uncertainty and itâs particularly hitting those who are trying to create new and innovative business models. And I think this is quite tragic. Itâs precisely startups that have the possibility to actually find the new business models that the cultural sector so dearly needs. Itâs just that the large incumbents â such as those two publishing houses that are behind the press publishersâ rights, they donât have a particular interest in having new competitors on the market that might be more efficient at bringing the news to people. So they have a clear interest in introducing this law. Even if they donât think that theyâre actually going to get any money from Google for using their snippets â itâs simply about making it more difficult for new market entrants to compete with them.
For the neighboring right [the biggest impact will be on] news startups, everybody who is dealing with news analysis. We had a couple of examples of startups like that that are, for example, trying to find ways to detect fake news, or to give people different sources or propose different sources to try to corroborate a story. Things like that would be extremely difficult with the neighboring right. It would also affect companies that are engaged in big data mining, because there is a new exception in the proposal that explicitly allows text and data mining for research organizations but not for anybody else. So this is an area where itâs currently quite unclear whether big data mining constitutes copyright infringement in the first place. But if you explicitly allow it for some then it kind of implies that itâs forbidden for others.
And I think the third kind of startup that is particularly affected by this is any kind of platform for sharing user generated content. For example we had an example of a Belgian startup called MuseScore, which is quite a popular platform for people to exchange sheet music â and itâs usually people simple sharing their own compositions. But of course there is no software that could automatically detect copyright infringements in sheet music because itâs not simply somebody copying the sheet music one on one. But rather whenever a composition to which the person who uploads the sheet music doesnât have the rights, is included there this would constitute a copyright infringement so you would have to somehow technologically make the leap from a particular melody to that melody being expressed in sheet music and that technology is not available.
TC: Could this reform meanÂ companies using large amounts of dataÂ for building AI models might technically be committing a copyright infringement â if theyâre using copyrighted data to trainÂ a machine learning algorithm?
Reda: Yeah, if theyâre, for example, learning to detect cats in pictures and using a bunch of cat pictures from the Internet to train their algorithms then the argument goes that by copying these images they are using a copyrighted work and they would need a license for that. In most countries itâs kind of clarified either that this kind of use is fair use or thereâs specific exceptions for text and data mining â for example Japan has introduced a text and data mining exception that clarifies that itâs not a copyright infringement. But thereâs also the question should this be covered by copyright in the first place? Because you are not using the work as an intellectual creation you are just using the data in the work. For example if youâre mining text and youâre looking for particular patterns, youâre not really interested in what the text means, youâre interested in how often a particular word is used or something like that. So arguably this is not actually a use of the work as such but rather just of the data thatâs carrying this work. So if we introduce a text and data-mining exception only for certain organizations and startups are not included in that, then weâre basically saying that any kind of startup that if youâre using copyrighted content for training their AI would be performing a copyright infringement.
TC: On the flip side, you could argue that while algorithmsÂ may not be using the work itself there is a kind of value exchange going on, based on extracting something useful (and potentially profitable) from the dataâ¦
Reda: Copyright law was never designed to be based on whether or not you are commercially benefiting from the use or not â I mean if this were the case then all non-commercial use of copyrighted works should be legal, but itâs not. Itâs always based on whether or not youâre performing certain protected uses such as making a copy. And in the digital world you just need to make copies a lot more than in the analogue world. I think that would have been perfectly legal in an analogue content â such as reading a book and counting the number of times a certain word is used is not a copyright relevant act in any way. And just when youâre using a computer to do the same thing then it suddenly is.
The other issue is that it only makes sense to require people to get a license if itâs actually possible to get a license. But how would this work? If somebodyâs just scraping loads of images off social media, for example, the rights holders of those images are spread all over the world â there are millions of them, and if you actually contacted them and said hey I want to use your cat picture that you posted on Twitter for training my AI can you please given me a license, they would not know what the hell youâre talking about. The transaction cost of actually trying to do this legally would be so high that it would simply not pay to do this kind of research anymore. So basically by saying this is something that requires a license you are guaranteeing that it is simply not going to be done legally. But youâre not actually creating new business opportunities for anyone.
TC: IÂ havenât personally heard many European startups voicing concerns aboutÂ the EU copyright reform â do you think thereâs an awareness problem here? Or maybeÂ they donât yetÂ realize the potential implications down the line?
Reda: I have a somewhat different impression. Because when we invited some startups to come to Brussels to speak about their experience it was extremely easy to find startups that were concerned about this, and had very specific concerns about either the neighboring right or the content monitoring. Of course if youâre a startup founder you probably donât have the resources to lobby in the same way that a large company does because youâre basically spending all of your time on developing your product, but nevertheless there are a number of startups that are actually coming to Brussels and talking to policymakers. They have formed a business association â Allied for Startups â which is also organizing their activities. And they focus quite a lot on copyright â so for example Allied for Startups has done this startup manifesto â scale up manifesto â that they have presented to the European Commission where they are extremely critical of these proposals. So of course I donât expect every startup founder in the EU to know about this because it is still quite a complex legislative process. But I wouldnât share the impression that theyâre not concerned about this. My impression is more that if they know about it they are concerned.
TC: What arguments are you hearing from larger tech companies â like Apple, Google, Facebook, Spotify â about theÂ copyright reform?
Reda: Apple, I have to say, has not been particular active on this. And also Google. Theyâre mostly active through their business associations. So itâs extremely difficult to say what exactly is the position of which particular players. Google was invited to one of the hearings that we had in the legal affairs committee. And they were basically spending their time explaining how Content ID works, what theyâre already doing voluntarily, and kind of also explaining the limits of what the technology can do â so, for example, they were quite open about the fact that itâs not capable of interpreting copyright exceptions and limitations.
Generally I would say the tech companies have been most concerned about the content monitoring provision. Because it really affects a very broad range of companies, where the neighboring right is more targeted at a specific kind of company that is active in the news sector in some way.
I met with Apple this week but they were more concerned about the Electronic Communications Code, so the telecoms review that is going on at the moment. They did have concerns about the content monitoring provisionâ¦Â Iâve spoken to Soundcloud and they are really quite concerned about this, and they were quite open in saying that if this kind of provision had existed when they started out, they would have never managed to survive. And nevertheless they are kind of a licensed service nowadays and are able to work with the rights holders. So theyâve been quite active on thisâ¦ Iâve met with Facebook at some point. And I mean they were just reiterating their concerns about the content monitoring and the neighboring right. Itâs certainly on their radar.
I think generally [the big tech companies are]Â trying to emphasis that theyâre already doing a lot of things on a voluntarily basis.
TC: Youâve personally been pushing for copyright for years â and made it your legislative priority. Why is that? And what wouldÂ you really like to see happen? What would be your ideal copyright reform?
Reda: I think that copyright reform is absolutely crucial for access to knowledge and empowerment of people. I think the cultural sector is just one small element of this. I think where the negative effects of the copyright system are much more apparent is the academic sector where basically you have a small number of extremely powerful publishing companies, that have profit margins of upwards of 30 per cent, that are basically living off getting articles for free from researchers at universities and then selling them back to the universities at astronomical prices. And I think this is an extremely unhealthy system, itâs contributing to global inequality because basically universities in developing countries and increasingly also in industrialized countries are not able to afford access to the content that is actually necessary to get a good education. So this is really what my motivation behind this copyright reform is.
Iâve worked as a student assistant at a university â and I know first hand the problems that exist with simply being able to access the knowledge that has been produced with public money because of the way that the copyright system is set up. What I would really like to see â I think where a huge mistake has been made in translating the copyright system to the digital world is that copies that are made in a digital environment should not be treated the same way as copies in the analogue age. If you have 20,000 copies of a digital book in your basement itâs very clear that your intention is to distribute them and so itâs kind of a short cut of the law to simply make the copies themselves illegal, and not just the distribution. But with digital technology thatâs completely different because any kind of use of digital technologies requires the making of copies and it is not implied that just because youâre making copies your intention is to give those copies to somebody else.
Just to give you an example, a friend of mine has a digital hearing aid â a cochlear implant which is basically implanted into his brain and it translates an audio signal into a digital signal, and thatâs why heâs able to hear again. And if there were no exceptions to copyright that allow for example this copy from analogue to digital then he would be committing a copyright infringement every time heâs listening to music. And this obviously doesnât make any sense. So what I would really like to see would be a reform that simply does not take digital copies as the basis for what is considered to be a copyright infringement anymore.
TC: What do you see as the likely result of the copyright reform processÂ â are you hopeful of being able to makeÂ substantial changes to the proposals?
Reda: Iâm quite optimistic that weâre going to be able to defeat the neighboring right. Itâs a wildly unpopular measure wherever it has been introduced in Germany and in Spain. The Parliament has already voted against it several times. Iâm of course concerned about the really intense lobbying from some publishers who are trying to shift the position of the parliament. But so far most of the parliament reports that have come out, including the Legal committee, they have all been proposing to get rid of the neighboring right.
I am more pessimistic when it comes to the content monitoring provision because there itâs extremely difficult to change this proposal into something that is not harmful. Itâs a very complex ecosystem and I think not everybody is aware of the problems associated with content recognition technologies. And as you were saying itâs kind of mixed up with the discussions around terrorism and hate speech. And I think thatâs always a very bad starting point for having a really targeted copyright reform that itâs not mixing up a lot of different issues. So there Iâm a lot more skeptical.
TC:Â What happens next? Whatâs the timeline from here?
Reda: The European parliament has presented its report, and the deadline for amendments to that is actually today [last Wednesday]. So after everybody has tabled their amendments the person who wrote the report, the rapporteur, is going to take those amendments and form them into compromises. Then weâre going to vote on it in the committee, probably in June or July, and then it will go to the plenary vote and to negotiations with the Council. So a final text could be expected maybe in a year or so.
TC:Â So thereâs still a chance for substantial amendments?
Basically so far the proposal from the Commission is only the starting point. And nobody is bound by what the Commission has proposed. And actually Council as well â there are a lot of national governments who are completely unconvinced by the neighboring right. And are asking a lot of critical questions so itâs very possible that we can get rid of these proposals if weâre keeping up the public pressure and itâs convincing also national governments that this is also not in their interest.
This interview has been lightlyÂ edited and condensed for clarity