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News Aggregators: Parasites or Saviors?

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By Jon Donley

“Michael Jackson is dead, according to celebrity gossip site TMZ.com.”

On June 25, news spread around the world in a few moments, as some of the most respected news sites in the world picked up and quoted TMZ.com and linked to the site. Some didn’t bother to give the site credit.

Under current U.S. copyright law, no one owns the “fact” of Michael Jackson’s death, and anyone can report it or comment on it, regardless of who originally reported it.

But under a proposal by a respected and well-read appellate judge, echoed and driven by a Pulitzer Prize-winning newspaper columnist, such third-party reporting might be banned by federal law. It could be 24 hours before other media could repeat what TMZ had discovered.

The double broadside — aimed at search engines, aggregators and bloggers — has the blogosphere buzzing.

The idea was floated in late June by Judge Richard Posner, who writes a joint blog with economist Gary Becker. Posner, noting the long decline of newspapers, said that for news organizations to survive, “expanding (U.S.) copyright law to bar online access to copyrighted materials without the copyright holder’s consent, or to bar linking to or paraphrasing copyrighted materials without the copyright holder’s consent, might be necessary.”

Connie Schultz, whose columns for the Cleveland Plain-Dealer on social issues won a Pulitzer, has latched onto a study by David and Daniel Marburger, who analyze what they call “parasitic” practices by aggregators that make it impossible for newspapers to survive. Schultz is urging every newspaper and journalism organization to join her in lobbying for a change to the copyright law to benefit newspapers.

David Marburger is a longtime attorney for the Cleveland Plain-Dealer and other newspapers. His brother is an economist. Their 51-page proposal comes as the battered news industry struggles to find a business model — any business model — to sustain its crashing revenue.

The ensuing furor has been predictable. The broad brushstrokes of Judge Posner’s post would cover every unauthorized paraphrase, quote or unauthorized link, a view that goes to the very definition of the web as a digital global network of interconnected links. Further, it goes against a cherished American principle, the right of “fair use,” seen as critical to public discourse and freedom of speech. Under federal law, the wording or form of a news report can be copyrighted, but facts cannot.

The Marburgers take a different tack than Posner, drawing a distinction between “pure aggregators” such as Google, which indexes headline links and sometimes a snippet of text, but little enough that a reader interested in the topic must click to the original article. “Parasitic aggregators” are described as those sites that rewrite or paraphrase enough of the content of an article that a large number of readers will be satisfied and not click through to the article.

While Google has managed to create a valuable business model of selling AdSense/Adwords links around its search results, the Marburgers say this is acceptable, comparing it to newspapers publishing television guides and selling advertising around the listings. Google in this sense is a directory, they say, which like TV listings, provides benefit to broadcasters.

But the Marburgers have an issue with Yahoo! News, which purchases a license to post Associated Press stories. Newspapers and other news-producing members of the AP not only pay for the right to publish AP stories, with occasional geographically competitive restrictions, but also are obligated to supply stories to the news service. Yahoo! legally licenses content. But the Marburgers say the Yahoo! News display is such that readers no longer have to turn to the newspaper website for the full story. And Yahoo! is under no obligation to contribute its own stories to the mutual content pool. This puts it at direct, and allegedly unfair, competition with local newspapers.

The heart of the Marburger proposal, as distilled by Schultz, would be to amend the copyright law to do two things:

• Aggregators would reimburse newspapers for ad revenues associated with their news reports.
• Injunctions would bar aggregators’ profiting from newspapers’ content for the first 24 hours after stories are posted.

While both the Marburgers and Schultz say Google doesn’t erode newspaper traffic — and in fact newspapers benefit from Google — the proposals leave open the door for some type of legal pressure that would cut newspapers a piece of the Google revenue pie.

Others in the industry insist on it.

This was one of the key parts of the Newspaper Economic Action Plan, a five-step program laid out in May by the American Press Institute.

Step three is the “Fair Share Doctrine — Negotiate for more money, a lot more, from Google and online news aggregators for a ‘fairer’ share of the profits from linking and ad sales. Additionally, negotiate equitable relationships with Internet giants and lobby for public policy that updates and enhances a ‘fair share doctrine’ for online news.”

Such lobbying has begun in earnest, courtesy of Posner, Schultz and the Marburgers.

Jeff Jarvis, author, blogger and director of the interactive journalism program at City University of New York’s Graduate School of Journalism wrote a scathing column deriding the opinions of both Posner and the Marburgers, and suggested that Schultz register as a lobbyist.

“Schultz and the Marburgers complain about what they call the ‘free-riding’ of aggregators, et al.,” he writes. “But they simply don’t understand the economics of the Internet. It’s the newspapers that are free-riding, getting the benefit of links.”

And based on the practices of the news industry in regard to Google, Jarvis has a valid point.

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