Google News will close its news aggregation service in Spain, in anticipation of laws that will force the company to pay for republishing ‘snippets’ of content from local publishers.
In a statement, the head of Google News, Richard Gingris, said that to continue to run the service in Spain and pay copyright fees for every article snippet republished by Google News would not be sustainable.
“This new legislation requires every Spanish publication to charge services like Google News for showing even the smallest snippet from their publications, whether they want to or not,” he said.
“As Google News itself makes no money (we do not show any advertising on the site) this new approach is simply not sustainable.”
The company will close its Spanish service on December 16, before the laws come into effect in January 2015.
The Intellectual Property Law, or LPI, would have seen fees paid by Google go to the Association of Editors of Spanish Dailies, of which a failure to do so could result in fines up to €600,000 ($750,000).
Similar laws were passed in Germany in 2013, however Google has not paid royalties to any German publisher as a result of the bill. In October 200 German publishers, under the name VG Media, signed an agreement with Google, which allowed the aggregator to display snippets of their content without payment.
Under the new Spanish law, this would not be possible. The German law contains an opt out clause for publishers, meaning they can agree to allow Google News to display snippets of their content without paying a fee. Google used this leverage to tell publishers that it would only display their content if they agreed to forfeit the legislated compensation they were able to receive.
In Spain however, the right to compensation is inalienable, as The Spain Report editor Matthew Bennett wrote.
“The Spanish version of the law stating that the right is ‘inalienable’, meaning that news publishers will not be able to renounce compensation provided for by the law,” he wrote.
“’This right is inalienable and will be made effective via intellectual property rights management organisations’, says the amended section of the law, adding that ‘any image, photographic work or mere photograph’ will also be subject to the measures.”
In Germany, major publisher Axel Springer opted to pull its content from Google News in October this year, only to reverse its decision in November.
During that period, according to a Reuters report, “Springer said traffic flowing from clicks on Google search results had fallen by 40 percent and traffic delivered via Google News had plummeted by 80 percent in the past two weeks.”
An AP report indicated that the ramifications of Google News’s decision could be far-reaching, citing Latin American consumers that rely on Spanish news organisations for their news consumption.
Mr Gingras signalled the company’s intention to continue to develop its news business and work cooperatively with publishers.
“We’re committed to helping the news industry meet that challenge and look forward to continuing to work with our thousands of partners globally, as well as in Spain, to help them increase their online readership and revenues.”