Google News wars are here again: Schmidt vs France on ‘news tax’

France has set Google(s goog) a year’s-end deadline for agreeing to voluntarily pay news publishers — or  it may legislate that it must pay a levy for the privilege.

Google chairman Eric Schmidt met French president François Hollande on Monday at the Elysée, which, in a statement, says:

“(Hollande) stressed that dialogue and negotiation between partners seemed, to him, the best way – but, if necessary, a law could intervene on this issue, as with the current project in Germany. The development of the digital economy calls for an adaptation in taxation in order to better understand the value of sharing and funding the creation of content.”

A unified policy from Europe’s two big axes, France and Germany, against Google’s view — that it crawls news stories but publishes only excerpts – could be a big problem for Mountain View.

Eric Schmidt meets France’s president, culture minister and other ministers

In August, Germany’s Bundestag passed Leistungsschutzrecht, a copyright law amendment devised by the country’s coalition government that will give news publishers a year-long exclusive right to publish their material online, requiring others obtain a license to excerpt.

Such legislation is likely devised from a position defending troubled industries, rather than genuinely safeguarding Fair Use-style rights. But that doesn’t mean Google won’t have to deploy its policy arsenal in defense again all the same.

Google wrote to several French ministers earlier this month with a threat of its own — if the levy is implemented, “as a consequence, (we) would be required to no longer reference French sites.” Google warned that France’s proposal would “threaten its very existence” and harm the content market, AFP reported.

Eric Schmidt arrives at the Élysée

This all sounds familiar…

Google’s most notable European news worries came in Belgium, where in 2007 a court ruled that Google did not have the right to run story excerpts from members of the Copiepresse trade group. Google duly pulled the newspaper sites’ out of Google News — ironically, much to their chagrin. Later, they struck an agreement — undetailed — through which Google restored the content in mid-2011.

Now the issue looks like re-opening again…

  • France: Hollande is in a good position to make headway, emboldened both by the European Commission’s competition scrutiny of Google’s indexing algorithm and by its French-led inquiry that has ordered Google to re-separate its recently united privacy policies.
  • Germany: The extent to which Google is really encapsulated by Leistungsschutzrecht is not fully clear, but a test could be on the horizon.
  • Brazil: 154 newspapers comprising 90 percent of the market are withholding their content from Google News, and say they have barely lost any traffic.

Not everyone takes the same stance. UK newspapers, supported by the country’s copyright court, also now require commercial aggregators pay a license for re-use, but their definition of “commercial” encompasses only paid clipping services, not free services like Google News. That means Google can limbo under the law by choosing not to commercialize its service.

That is not necessarily a productive situation. Together with its stock defense (“we drive four billion clicks to news publishers”), this “we don’t profit from your content” argument may be one which Google deploys in negotiation. But that won’t necessarily trump the equal refrain from many a worried publisher: “Neither do we!”