Podcast | Digging Deeper: Is Europe going to lose its memes?

To give you a quick overview before we dig into the implications of Article 13, what it means is that any websites that host large amounts of user-generated content (like YouTube or Facebook or Twitter) are responsible for taking down that content if it infringes on copyright. But of course, things aren’t that simple. The impact of these changes are comparable to the scope of 2018’s General Data Protection Regulation (GDPR).

Sure, this is happening in far away European Union. But in the global family that is the internet, we show up for each other, don’t we? Remember net neutrality? Which is why this spotlight on Article 13. My name is Rakesh Sharma, and you are listening to Digging Deeper with Moneycontrol.

The Economic Times noted that European lawmakers were sharply divided on the copyright issue, with both sides subjected to some of the most intense lobbying the EU has ever experienced from tech giants, media firms, content creators and online freedom activists. According to Financial Times, at least one European Parliament member has received a death threat! Launched in 2016, the revamp to European copyright legislation was seen as an urgent requirement since it had not been updated since 2001. That, by the way, was way before the birth of YouTube or Facebook. The lobbying saw prominent personalities also weigh in on the topic. Supporters of the new laws included Lady Gaga, Debbie Harry and Paul McCartney while those against it included the creator of the worldwideweb, Tim Berners-Lee, and musician Wyclef Jean.

European Parliament Rapporteur Axel Voss claimed the legislation is designed to protect people's livelihoods. He said, “This directive is an important step towards correcting a situation which has allowed a few companies to earn huge sums of money without properly remunerating the thousands of creatives and journalists whose work they depend on...It helps make the internet ready for the future, a space which benefits everyone, not only a powerful few.”

The reform was staunchly backed by France and several other member states, and the vote in the European Parliament might usually have been a mere formality, but the opposition of influential firms such as Google as well as the grassroots protests meant that the outcome of the vote was fairly undecided until this week.

The internet will change forever (or something.)

Tech magazine (and cool-bro-staple) Wired reported that European politicians voted to pass Article 13 and Article 11, alternatively known as “upload filter” and “link tax” respectively, as part of sweeping changes to regulation around online copyright. The European Parliament passed the legislation by 348 votes to 274. (Did you hear that story about how several MEPs have said they accidentally voted the wrong way on a key amendment? Meaning the most controversial aspects of the law might have been removed had they not made a mistake? Anyway.)

Opponents of these changes had hoped for last-minute amendments to the legislation, but failed to garner enough votes. Julia Reda, a German MEP, or Member of European Parliament, representing the Pirate Party that opposes the copyright directive, claimed it was a “dark day for internet freedom”. On the other hand, Margrethe Vestager, European Commissioner for Competition, said the result was “great news”.

Wired also reported, “A vote on debating amendments – including an amendment to remove Article 13 and the Article 11 ‘link tax’ from the broader copyright legislation – was rejected by just five votes. EU member states now have two years to pass their own laws that put the Copyright Directive into effect.” Andrus Ansip, vice president of the European Commission and a key advocate for the law, said it was a big step ahead that would unify Europe’s digital market while protecting online creativity.

This new law is important because, as the GDPR issue demonstrated, European laws can influence policy in many countries. Details of the new legislation will have to be decided by individual EU member states, but the law is likely to impact how the internet works in Europe and elsewhere.

Let’s break it down

The Verge reported that Article 11 allows publishers to charge platforms like Google News when they display snippets of news stories, while Article 13 gives sites like YouTube new duties to stop users from uploading copyrighted content. In both cases, critics claim that such well-intentioned laws will only cause more trouble. Article 13, for instance, could lead to the introduction of “upload filters” that will scan all user content before it is uploaded to sites in order to remove copyrighted material. The law does not explicitly call for such filters, but critics say it will be an inevitability as sites seek to avoid penalties. Why? Under the new rules, European law for the first time will hold platforms legally responsible for enforcing copyright, requiring them to check everything that their users post to prevent infringement.

In simple terms, Article 13 says content-sharing services must license copyright-protected material from the rights holders. If that is not possible and material is posted on the service, the company may be held liable. These rules apply to services that have been available in the EU for more than three years, or have an annual turnover of more than €10 million or a little over 11 million USD. CNN claimed this is the latest flashpoint between tech giants and European officials, who have taken a more robust approach than the US over competition issues, data protection and tax. Antonio Tajani, the president of the European Parliament, said the vote would "put an end to the existing digital Wild West by establishing modern rules."

The need for Article 13

We’re way past the early days of the internet when copyright was not a serious concern outside of content piracy. As Financial Times explained, “Silicon Valley titans continue to profit from exemptions around liability for user behaviour and copyright infringements which date back to the 1990s. Since then, companies such as Alphabet and Facebook have become many internet users’ first supplier of news and entertainment.”

It added, “Their success has come at the cost of newspapers and music revenues. In the US, Facebook and Google accounted for 60 percent of digital advertising revenue last year, according to one study. A Facebook service trying to offer local reporting from various parts of the US struggled because small news outlets are closing, partly as a result of falling advertising revenues. The two key provisions of the copyright directive, Article 17 (previously Article 13) and Article 11 seek to ensure Big Tech is more proactive in stopping copyright infringement.”

Currently, platforms are treated as conduits without the responsibility to screen uploaded material. That means copyright holders send takedown notices after the fact to have copyrighted content removed. You know how it goes...we see a video of a movie, TV show or music video...and a few days later after it goes viral, the video is taken down. That’s copyright law at work. The news laws put the onus on the platforms where such content is uploaded. Article 13 requires platform companies to run filters that would scan uploaded content for copyright violations, and Article 11 allows publishers to charge platforms for featuring more than short excerpts of news articles. It is a safe guess that that’s most of our day to day consumption as far as the internet goes.

However, Article 13 does not include cloud storage services. Also, and this is significant, there are already existing exemptions, including parody, which, for example, includes memes. Yes, memes, without which we have no use for Twitter, WhatsApp and maybe even Instagram.  This meme fight turned into a significant issue. Article 13 prompted fears over the future of memes and GIFs - stills, animated or short video clips that go viral - since they mainly rely on copyrighted scenes from TV and film. The BBC reported that  there is also a long list of exemptions, including non-profit online encyclopaedias, open source software, development platforms, cloud storage services, online marketplaces and communication services. That said, even if the European Parliament claimed memes would be "specifically excluded" from the directive, it remains unclear how tech firms would be able to enforce that rule with a blanket filter.

But as the Wired article explains, “...the Directive on Copyright would make online platforms and aggregator sites liable for copyright infringements, and supposedly direct more revenue from tech giants towards artists and journalists.” As we noted earlier, platforms such as YouTube aren’t responsible for copyright violations, although they must remove that content when directed to do so by the rights holders. Supporters of the Directive on Copyright argue that this means people are listening to, watching and reading copyrighted material without the creators being properly paid for it.

Unsurprising then that the reform was backed by media companies and artists, who want to obtain a better return from web platforms that allow users to distribute their content. Many musicians and creators say the legislation will compensate artists fairly. According to a Bloomberg article, Music industry association IFPI estimated last year that while Spotify paid out about $20 per user in royalties, YouTube shelled out less than $1. And Taylor Swift pulled out from Spotify claiming she was underpaid! If the new copyright law inflicted punitive measures or litigation whenever YouTube failed to police this properly, that would probably strengthen the hands of artists when they’re wrangling over percentages on content payments.

The International Federation of the Phonographic Industry, which represents the global record industry, welcomed the result. “This world-first legislation confirms that user-upload content platforms perform an act of communication to the public,” said CEO Frances Moore. Robert Ashcroft, chief executive of PRS for Music, which collects royalties for artists, said the new rules help create “a fair and functioning market for creative works of all kinds on the internet". In June 2018, 84 European music and media organisations, including Universal Music Group and Warner Music Group, publicly declared their support for the Copyright Directive.

There’s another law regarding sports content. Article 12a could stop anyone who isn’t the official organiser of a sports match from posting any videos or photos of that match. This could potentially put a stop to viral sports GIFs and even stop people who attended matches from posting photos on social media. But as with the other articles, it depends on how the directive is interpreted by individual member states when they make it into national law.

A complex issue

It’s not just memes that present a conundrum. Video gamers who share their gameplay on video-streaming services such as Twitch and YouTube highlight the complexity of copyright online. Kathy Berry, a lawyer from Linklaters, told the BBC, “Multiple copyrights can exist in a single product...Video game studios own various copyrights in their games: the underlying code, the graphics, music, dialogue. When a gamer creates a video game video for YouTube, the video itself is a new copyright work owned by the gamer. However, as it also incorporates copyright works owned by the video game studios, the authorisation of both the gamer and the studio would be required to put it online.”

Currently, most video game publishers allow gamers to share videos of their gameplay online. Nintendo had been more restrictive, but recently relaxed its rules. Under Article 13, games studios could instruct Twitch and YouTube not to show videos of their games. Berry said, "Studios tend not to enforce their rights against YouTube gamers in order to avoid the PR implications of being heavy-handed with fans, and because the videos can have significant promotional value." Gamers could argue that their videos are exempt from Article 13 because they have added their own commentary, criticism or review. But Berry clarified, "These defences have been largely untested in the courts in this context.”

While the new law is seemingly aimed at fixing copyright issues, many are worried Article 13 will completely change how we share information online and make it much harder for small sites to compete with tech giants.

As for Article 11, no one is really sure how this one would work. How much of an article has to be shared before a platform has to pay the publisher? The Copyright Directive states that platforms won’t have to pay if they’re sharing “mere hyperlinks which are accompanied by individual words,” but since most links are accompanied by more than a couple of words it seems that many platforms and news aggregators would fall afoul of the new rule. Wired argued that the Directive does allow an exemption for “legitimate private and non-commercial use of press publications by individual users,” so it looks like individuals sharing links on social platforms will not have to dip into their own pockets. But even this is open to interpretation. Is someone with a huge following on social media, who posts adverts to that audience, a “private and non-commercial” entity? Social media influencers beware! Considering the era of the influencer seems to be facing its dusk, this is just as well.

The critics

The new laws are proving pretty unpopular. More than one hundred thousand people have protested the legislation over the last few weeks, and more than five million people signed a petition calling for the removal of Article 13. (What a busy month it has been for signing petitions in Europe!) The final days before the vote were marked by marches and media stunts, including tens of thousands of people protesting in Germany on Saturday under the slogan Save the Internet. There were similar protests in Austria, Poland and Portugal, while major Polish newspapers printed blank front pages on Monday in an appeal that MEPs adopt the reform.

Germany has been at the heart of the anti-reform movement, led by Julia Reda, a 32-year-old Pirate Party MEP who has spearheaded a campaign against the two provisions that have become flashpoints in the debate. Reda and her supporters warn that Article 13 would require platforms to install expensive content filters that would automatically and often erroneously delete content from the web.

Critics of the new rules include the influential Silicon Valley lobbying group the CCIA, whose members include Google, Facebook, eBay, Amazon and Netflix. On June 12 last year, a large group of prominent tech leaders including Wikipedia founder Jimmy Wales and Tim Berners-Lee signed an open letter arguing against the Directive. It’s worth noting that despite the Directive including an exception that explicitly excludes Wikipedia and GitHub from these rules, both companies have maintained their opposition to the Directive. Last week, sites including Reddit, PornHub, and Wikipedia also protested the legislation. Wikipedia founder Jimmy Wales tweeted, “You, the Internet user, have lost a huge battle today in Internet parliament. The free and open internet is being quickly handed over to corporate giants at the expense of ordinary people.  This is not about helping artists, it is about empowering monopolistic practices.”

Worse, critics say it would be impossible to pre-emptively license material in case users upload it. Reda suggested services would have to "buy licences for anything that users may possibly upload" and called it an "impossible feat". A BBC report stated that Article 13 does not force companies to filter what users are uploading, although critics say companies will be left with no choice.

Some of those who oppose Article 13 claim have labeled it a "link tax" that will stifle discourse on the internet and pay only big media companies, with no real benefits for journalists or news gatherers.

According to FT, critics have also questioned whether Article 11 will indeed force the big players to pay up. When Spain tried a similar measure in 2014, Google simply turned off its news service there. It might be unwilling to do that EU-wide. Instead, the internet giant might replicate its experience in Germany, where it opted to carry news only from sites that agreed to have their content shown for free.

YouTube already has its Content ID system, which can detect copyright-protected music and videos and block them. But critics say developing and implementing this type of filter would be too expensive for small companies or start-ups. YouTube put out a statement that said the final version of the directive was an improvement but that it remained concerned Article 13 could have “unintended consequences that may harm Europe’s creative and digital economy”.

Others have warned that algorithms often make mistakes, and might take down legitimately used content. A blog by online rights group EFF claimed, “Filters will subject all communications of every European to interception and arbitrary censorship if a black-box algorithm decides their text, pictures, sounds or videos are a match for a known copyrighted work.” The campaign group Open Knowledge International described it as a massive blow for the internet. Chief executive Catherine Stihler said, “We now risk the creation of a more closed society at the very time we should be using digital advances to build a more open world where knowledge creates power for the many, not the few.”

And that’s no small fear. In February, Bloomberg reported that a European Commission document outlining the final text of the law explained that tech platforms might still avoid liability if they can prove they made their “best effort” to obtain licensing, their “best effort” to remove unauthorized content, and their “best effort” to stop it being re-uploaded. I suppose one can expect lawyers and court judges to fully test what the definition of effort really means. And should the tech giants respond by doing more filtering of music content, it might just end up entrenching their power over what’s offered up to users. Ergo, square one.

In a statement, Google said, "We'll be studying the final text of the EU copyright directive and it will take some time to determine next steps. The details will matter, so we welcome the chance to continue conversations across Europe." In the end, Google and Youtube could come out of this unscathed. As Wired explained, YouTube could end up doing rather well out of Article 13. If all platforms need upload filters, Google is ideally placed to sell them. Its parent company, Alphabet, has spent more than $100 million building a copyright-detection system that’s used by more than 9,000 broadcasters, movie studios and record labels worldwide.

With the European Union passing the Copyright Directive, experts in copyright law told The Verge that despite both jubilant and unhappy reactions, the real test is yet to come. Raffaella De Santis, a technology and media lawyer said, “This outcome is unpopular with digital services and importantly, many European voters. The key focus now will be on how the directive is implemented across the EU over the next two years.” The Financial Times noted that the EU has taken an important step towards reining in Big Tech, which it claims is a long overdue reform.

How much longer before such a move in India? Watch this space.