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Unintended consequences: Spain’s Aggregation Tax Has Screwed Over the Media It Was Made to Protect

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Kari Paul reports in Motherboard:

A law Spain passed in October 2014 charging online aggregators like Google News a fee for linked content has backfired, according to a new study.

The legislation, which went into effect January 1 of this year, requires aggregation sites to pay a fee to original publications when posting links or excerpts from them online. The law, which caused Google News to shut down in Spain, was pushed by the Association of Editors of Spanish Dailies as a means to protect the print industry. But the study commissioned by the Spanish Association of Publishers of Periodical Publications (AEEPP) found it has been harmful to Spanish media at large,

“The negative impact on the online press sector is also very clear, since a very important channel to attract readers disappears, resulting in lower revenues from advertising,” the study said.

The report found clear evidence news aggregators actually expand the market for original sources rather than diminish it. It also showed the law disproportionately hurt smaller publications that relied on Google News and similar aggregators for traffic.

In addition to Google News, other aggregators including Planeta Ludico, NiagaRank, InfoAliment, and Multifriki shut down for fear of legal and financial liability. Companies that don’t pay the tax could face fines of up to €600,000 or $654,480.

The shutdown of these sites, particularly NiagaRank, was a blow to innovation in Spain, the report stated. . .

Continue reading.

Written by LeisureGuy

31 July 2015 at 11:46 am

Posted in Business, Law, Media, Technology

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