Every day we receive a fresh reminder of the unprecedented power and reach of US internet and consumer technology companies. Alphabet’s Google, Facebook, Amazon and Apple can affect the lives of millions by launching services or tweaking the algorithms that decide where advertising or information flows.
Facebook is now entangled in a controversy over how its team of human curators may have favoured liberal publications over rightwing ones when picking stories for its 1.7bn active monthly users. Meanwhile, a jihadi extremist tapped the online advertising market by using Google’s AdSense network to draw ads from Citigroup, IBM and Microsoft to his website before he was blocked.
Both incidents in different ways raise the question at the heart of the business of social networks and internet service providers: how much blame should they take for what they carry? Do they occupy legal safe harbours, in which they cannot be sued or even fairly criticised for what happens on their networks, or are they like publishers and editors that bear responsibility?
The answer, it seems to me, has changed and continues to evolve. When they were smaller and technology was less advanced, it was wrong to behave as if they were entirely responsible for their users, and it would have held back economic progress. It would still be misguided to expel them from safe harbours entirely. But they have wider duties now.
That brings us to a lingering dispute that has reared its head again: the behaviour of YouTube, Google’s online video-sharing site. Since it was founded in 2005, YouTube has been immersed in controversy over copyright protection. Music labels and film studios are on one side while on the other are users who upload, along with their own material, pirated videos and songs.
YouTube is in negotiations with the three big music labels - Vivendi’s Universal Music, Warner and Sony - on new contracts for the online licensing of their artists’ songs. The labels complain that YouTube offers a poor deal compared with audio services such as Spotify and Deezer. Spotify pays labels an average of $18 per user annually, while YouTube pays $1, according to the IFPI global trade body.
In terms of volume and influence, YouTube has grown hugely since Google acquired it in 2006 for what now seems like the bargain price of $1.7bn. It has become a medium in its own right, allowing YouTube stars such as PewDiePie, Zoella and HolaSoyGerman to amass millions of subscribers with quirky music, fashion and games-related short-form videos.
This has turned YouTube into as crucial a platform for musicians as Viacom’s MTV music video channel once was. Even Universal, when it launched a blitz to shield Taylor Swift’s album 1989 from piracy in 2014 - including nearly 144,000 blocks on YouTube and SoundCloud uploads, and more than 500,000 requests to delete search links to infringing files - kept her single “Shake It Off” on YouTube.
Despite periodic wrangles with Spotify and other audio streaming services that offer subscription and free services to users, music companies prefer them to YouTube. Not only do they pay better - Universal estimates that it now gets less than one-tenth of a cent per YouTube song play - but they do not admit user-generated content, and so minimise the risk of piracy. On the face of it, the solution is obvious. If they dislike YouTube or its financial terms, they should stop licensing their music to it. There are more alternatives now - Amazon this month launched its own video upload service. A boycott is unlikely, though. Despite their gripes, the labels will probably sign up again with the devil they know while lobbying for changes in the law.
They sense an opportunity in the European Commission’s review of copyright laws, and a similar move by the US copyright office. The EU’s sympathy for musicians and publishers makes it more likely than the US to limit the safe harbour that shields internet platforms from liability for users’ piracy.
Removing YouTube and similar platforms entirely from these safe harbours would be a mistake. It might suit music labels for user-generated content to confront a legal onslaught but harbours, pioneered in the 1998 Digital Millennium Copyright Act in the US, have served a positive purpose. They have encouraged the kind of creativity seen on YouTube to flourish.
Yet the rules, which date from before YouTube was born, should be tightened. As Mark Mulligan of Midia Research says, “Safe harbour was not designed for the way in which it is being used.” The main flaw is that responsibility for finding illegality is heavily loaded on content owners rather than internet companies. The latter do not have to block piracy of which they are unaware.
Tougher laws need not hurt YouTube. It has pioneered the use of technology to catch and stop infringement - its Content ID system allows labels to filter out pirated files before they appear. The labels say that Content ID does not work as well as claimed but YouTube is at least accepting responsibility. Internet groups with deep pockets and technology expertise should do.
