“Close the value gap,” they said. And this is what they tried to do. But good intentions sometimes lead to the wrong destination.
The road to hell….
Let’s start at the beginning. It is common knowledge that social media platforms get to post content for free thanks to a provision of the DMCA that makes them not liable for any content posted by their users. The only requirement the platform holds is to remove a file if a legitimate copyright infringement complaint is filed.
The result is that Facebook, Instagram, Pinterest, Twitter, Youtube find themselves in a unique historical situation whereby they can freely and legally monetize the content they host without sharing any revenue with their creator. A bit as if a television channel like CBS would broadcast tv shows without ever paying their creators. The discrepancy between the revenue generated by a platform and the money redistributed to the creators of content is called the “value gap.”
After years of lobbying, various associations representing artists of all kinds ( music, graphic, video, and photo) finally got the European Union to listen and shut the safe harbor provision. After 4 years of committees, votes, rewrites, subcommittees, panels, discussions, meetings, and hearings, the Digital Single Market (DSM) Directive was approved in April 2019. Covering a wide variety of issues, it includes Article 17, which requires platforms to get a license for the content they use—no more safe harbor.
The intent of article 17 is to make sure that artists get a fair share of the revenue generated thanks to their content and forever close the value gap.
It’s in the details that the devil lurks, they say.
While not many argue with the purpose of the directive, many did see issues on how to implement it: With millions, if not billions of uploads, how does one reconcile content with ownership to facilitate licensing rights? How does one police platform to make sure that the billion of content they are hosting is appropriately licensed? The answer, they thought, was in technology. “Just build a widget that, every time content is uploaded, automatically checks against a database who is the owner and if it was properly licensed.” Let’s call it an “upload filter.” Not soon after this was said, did the floodgates of issues opened up.
The thing with people who don’t understand technology very well, like politicians and commission attendees, is that they think it works like magic. You need something to be done and poof, a software engineer or two can whiff it up in a week or so. Unfortunately, it does not work like that.
For the upload filter to work, you would need a database of all the creations ( film, video, music, photographs, painting, ..) past, present, and current with their associated copyright holders. Something like it partly exists for some of the content like movies, TV shows, but tends to be less accurate when dealing with music, videos, photographs, or painting. In fact, for photography, there is no such database at all. Just a few independent photo agencies with incompatible databases whose combined total content represents, at most, 1% of all photographs available.
Thus, for the upload filter to work, one would have to start by assembling all the copyright information for all work since the beginning of time. If that is not hard enough, the next step would be to automatically search that database every time new content is uploaded. For visual content, like photography, a similarity search would be used. But those are not only inaccurate, they are also imprecise. Let say you upload a picture of the Eiffel Tower taken during the day from the bridge across it. The visual search would probably find thousands of matches of identical images taken from the same spot by various photographers at different times. Which one is the correct copyright holder? Multiply this a million times a minute for all the pictures uploaded every day to platforms representing a landmark of some sort.
And if the correct copyright holder is found, then what? How does one know if they approved the right to that person to upload to that platform? Another database that centralizes all the rights given by everyone to everybody?
In other words, the upload filter was a pure sci-fi fantasy. With a sprinkle of magic.
Where the road ends..
In light of the total collapse of the initial approach, a new old solution emerged: Copyright collection societies. Instead of addressing each copyright holder, platforms would pay a yearly fee ( or a stipend, tax, levee, depending on what country you ask) to a copyright collection agency. Those would then redistribute according to their internal process. And this is where the road ends.
While some industries, like music, have well-established well-oiled collection societies, others like photography, have not. While they exist, they have wandered in the shadows of European copyright laws, collecting massive fees from companies that need to clear vast volumes of photocopies. They have redistributed those according to an opaque, unverifiable process, which includes obscene self-management fees. Those same societies are now about to receive massive amounts of license fees on behalf of photographers worldwide from the likes of Facebook, Google, Twitter, Pinterest, Instagram, Snap without any obligations to report, explain or declare how they redistribute it.
The value gap doubles in size
Not only will platforms continue to generate revenue from usage of their content, but thanks to the new law, copyright collection societies will also get millions as well. And since they have no legal requirements to justify how they redistribute the money they receive, continue to collect hefty management fees while keeping their redistribution scheme secret.
Of course, the Getty’s, Shutterstock, Adobe will work out yearly deals with them. But what about the thousands upon thousands of photographers who do not have representatives? They will probably receive nothing.
The CEPIC, who supported and actively lobbied for article 17, is a supporter of this solution. They already have had conversations with a couple of European copyright collection societies to facilitate this process.
What was an attempt to minimize the value gap is just going to increase it by adding another layer of profiteers. And leave most of the content creators in the same position they were before the passing of article 17, receiving no income while platforms and now collection societies make millions thanks to their creation.