Spain stifles innovation – this new content law is useless.

The government has proposed a new Intellectual Property law that has everyone excited, because it contains what is called a “Google” tax. Note the proposed bit – it hasn’t been voted on yet. We don’t even, it seems, have the full draft of the law, it hasn’t been officially released. But people are excited.

Now, the idea is that websites which use content from other people must pay a “fair usage fee”. In theory, it means that websites like Google News must pay a copyright fee for each news story it displays.

And for people like Richard S. who copy entire stories off my websites for his facebook page? Probably a summary execution….

Of course, this is complete bollocks.

You see, Spain can only enforce this law on websites and companies based in Spain. And the big Internet companies aren’t. They can’t even get them to pay basic tax in Spain, they certainly aren’t going to get them cough up for this sort of nonsense. Yahoo! doesn’t even have an office in Spain any longer. Google employs a couple of salesrats in Madrid to take the big spenders out to lunch. Etc. They don’t let any of their money touch Spanish jurisdiction, it’s all booked to Irish or Luxembourg companies with extremely low tax rates.

So they’re going to carry on using Spanish content on their websites in exactly the same way as before. No difference. And untouchable, outside of the reach of Spanish courts. They aren’t doing anything wrong.

But…….

What about Spanish based companies? Well, they’re stuffed and can’t compete. Popular Spanish sites like meneame.net will, according to its founder Ricardo Galli, have to hang up the closed sign if the news companies start coming after them. All he’s doing is allowing users to post links to websites, showing an excerpt, then letting users comment on them. But under the law, he assumes he’d have to pay for every single link shared.

Now, the Law contemplates creating a new organisation that will receive the copyright money and distribute it to the content creators. Large users will have the right to negotiate fair fees with the content creators directly. But everyone who wants to share links in Spain will have to pay, or this (probably privately run for profit) organisation will go after them in the courts.

Meaning Spanish innovation will flounder, websites move abroad, and the Iberian culture becomes even more Anglo-Saxon.

You see, the French tried to do this in 2012. Guess how much tax Google, Yahoo, etc pay? I bet you guessed right the first time.

Spain just isn’t a large enough player to make this work. Now, if the whole EU does this…. it might just work. But even so, it probably won’t.

And besides which, news aggregators aren’t a bad thing. Newspapers don’t much like them, because they let net users quickly compare stories before deciding which site to click through to, but overall they’re a good thing that bring more users to the sites. And pay-wall news sites like The Times have learnt to use them effectively to bring more users. It’s just a mindset.

So this new content law is useless. Protectionist, stifling and bureaucratic. Of course, the main media sites love the general idea and are rooting for it, so it should go through very soon. I’ll have to sign up for it……..

El Pais in English has more.

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