Google is in a high-stakes face off against the Spanish Association of Daily Newspaper Publishers. The industry group aggressively backed and ultimately won approval for a Spanish copyright law that requires content providers be paid for the use of snippets and images drawn from their news stories. The law goes into effect next month, and violators are subject to fines of up to 600,000 euros, or about $743,000. (While some are calling the new law a "Google tax," it will apply to similar online news services.)
The argument is, in many ways, simple. Google says its relationship with publishers is symbiotic. No, no, say the Spanish publishers, it's parasitic -- and they're done with being hosts.
"For centuries publishers were limited in how widely they could distribute the printed page," wrote Google executive Richard Gingras in a blog post announcing the decision. "The Internet changed all that -- creating tremendous opportunities but also real challenges for publishers as competition both for readers' attention and for advertising Euros increased."
What's worse for Google than the Spanish law is that the issue isn't likely to stop at Spanish borders. The Spanish publishers have the backing of the European Newspaper Publishers' Association, which holds among its core principles that, "In the digital environment, respect for copyright by all market players, including search engines and news aggregators, is a necessary precondition to ensure a sustainable press sector in Europe." In other words, the rest of Europe wants Google to pay for using local news content, too.
What has the European publishers so upset? Google News does to news stories what, in many ways, Google's search engine does to Web sites. It collects what's available online and presents it in a way that makes it easy and pleasant for Internet users to find what they're looking for. That Google built its index of the World Wide Web without anyone's permission in the late 1990s did a great deal to make the online world navigable to the average user.
But there is a difference. Google search results don't really resemble Web pages. But Google News looks a lot like the front page of an online newspaper. And that makes publishers nervous that they're being replaced.
Google News has been good for Google. Launched by a company engineer who was disappointed by what turned up from a search for "World Trade Center" in the hours after the Sept. 11, 2001, attacks, Google News has helped turn the search giant into a more real-time, responsive service.
But Google argues that the service is good for publishers, too. The company has said that it drives "over 10 billion clicks a month to 60,000 publishers' websites, and we share billions of dollars annually with advertising publishing partners."
One irony in the dispute is that Google has never run ads on Google News, in part so that it could present the site as more of a public service than a product. Google has argued that having no ads on News means there's no revenue from which to pay publishers. Of course, Google, as a multibillion-dollar company, might be able to find the money elsewhere. But forcing Google into a pay-for-snippet model, some online activists have argued, threatens to disrupt the Internet ecosystem and damage the "right to link" that has long defined the World Wide Web.
So, for now, Google isn't willing to play ball.
The company has other woes in Europe. U.S. companies like Microsoft and Yelp have argued to sympathetic European regulators that Google is abusing its search dominance -- the company reportedly has 90 percent of search traffic in Europe -- by favoring its own listings for local services such as restaurants, stores and doctors.
Debates over whether Google is too powerful have traditionally been limited to anecdotes and bad feelings, but one anti-Google, Yelp-backed coalition known as Focus on the User has been trying to prove that case with data: It has presented European regulators with side-by-side tests that compare how likely users are to click on Google's local search results without any goosing by the company.
With Google pulling down its news service in Spain, the company is claiming that data-driven tactic for itself. Spanish publishers have argued they are better off without Google News. Now they will be able to watch the Web traffic and revenue data to see if they're right.
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