Google's 'link tax' negotiations break down as France talks tough over new laws

Google's 'link tax' negotiations break down as France talks tough over new laws

Summary: Negotiations between Google and French media companies seem to have ground to a halt, while a government enquiry has came up with a fresh idea: tax big online companies based on the user data they collect.

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Negotiations between Google and French media companies over a so-called "link tax" have come to a standstill, according to the French newspaper Le Monde.

Last autumn, Google's executive chairman Eric Schmidt met with the French president François Hollande to discuss the "link tax" — an idea put forward by French newspaper publishers that would see the search giant having to pay the media companies for linking to their stories in Google News. Hollande initially called for an agreement between the two parties to be found by the end of December.

That deadline has since been postponed till the end of this month, but an agreement seems unlikely: Le Monde reported on Friday that Google offered to pay an annual contribution to the media companies of €50m, only a third of which is guaranteed — the remainder will depend on how Google's bottom line fares that year. For their part, the publishers are looking for Google to dig deeper, and are seeking a stipend in the region of €70m and €100m per year.

"I don't know if Google really wants to find a resolution," an editor present at the discussions said, according to Le Monde.

Aurélie Filippetti, French minister for culture, predicted earlier this month that the disagreement would be solved quickly, before the government's deadline of the end of January — on the grounds that, should an amicable arrangement not be found, the government would begin passing laws to solve the issue instead. Last week, Hollande confirmed that "a legal or tax measure will be taken" to force Google and others who similarly "profit from information" produced by the French media to contribute to their financing. 

A government enquiry set up to look into the issue of taxation and the digital economy — called "Colin et Collin" after the two civil servants appointed last July to lead it, Nicolas Colin and Pierre Collin — published its conclusions late last week, and could provide hints as to what "legal or tax measures" the French government may take.

Colin and Collin chiefly focus on what they see as the core of the digital economy: the data produced by internet users, willingly or not. The pair suggest the creation of a new tax (PDF) based on the data collected "to regularly and systematically monitor users' activities in a given area," such as a country.

And, in order to limit the extent of tax optimisation practices, the enquiry calls for a change in the way European income tax is administered, especially the way the head office of a company is defined "to link it to the data coming from end users' 'free work'"; that is, content produced and provided for free to online heavyweights like Facebook or Pinterest by their users.

Topics: Google, Government, Legal, Privacy, EU

Valéry Marchive

About Valéry Marchive

A graduate in networking and databases and an author of several books about Apple gear, Valéry Marchive has been covering the French IT landscape since the late 90s, both for the consumer and enterprise sectors.

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14 comments
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  • A Sticky Wicket this is.

    The papers always can set their web-sites to not be crawled or indexed by Google. This, however, is on-line suicide and few would ever see the on-line version of the data.

    In someways this is sad. The internet, in setting up the democratization of information, has also de-valued the creation of information (An article about 2-3 years ago looked at Google as being the single largest destroyer of wealth on the planet.). There are plusses and minuses. The plus side is it is cheaper and the quantity is vast. The minus is it is often harder to actually find what you are looking for and, much worse, the quality of of information has plummeted. Blogs act like "reporting' but offer no in depth analysis to fact checking (ref: Mike Daisey's hit piece on Apple the media ran with).

    If you do traditional quality reporting, the costs are higher than the return to actually generate the data and information. There may be hope in maintaining small niche markets to have a small group of people doing very targeted reporting with search aggregating the results to a hyper-large audience. So instead of having several dozen major news agencies that cover everything you end up with 10's of thousands of small groups with information aggregated by search. Learning what ones to trust then becomes the hard question.

    The trade offs are tough. One mindset is: driving prices down is ALWAYS (without question) better for the consumer; is, however, "you get what you pay for" True? These are diametrically opposed views with truth in each.
    Bruizer
    • France wants to tax the heck outta everyone

      France is the next PIIGS yet to be named. They are so desperate they wanted to tax everyone including a ridiculous 75% tax on their rich citizens so you bet they'd go after GOOGLE hard here.
      LBiege
    • The media...

      ...don't have to publish their articles for free on the Internet, at least not right away. Google crawlers aren't going to be logging into paid services, and even if they did, people would have to pay to see the content (or hack the sites, which is already illegal).

      But deep linking prohibitions are guaranteed not to work and efforts by website owners to enforce them should be abandoned. It's truly not worth the resources expended to stop it.
      John L. Ries
    • new technology is always disruptive

      Is it possible that the news business needs to restructure itself? Is it possible that now that any news organization can reach anyone in the world, we no longer need a newspaper in every town?
      If you look at the news today, all these small operations barely have time to simply parrot press releases issued by the governments and various corporations. When did we have the last investigative reporting piece that stopped the invasion on an innocent country? But, if they consolidated into much smaller number of larger operations that can afford to investigate and report in detail to the public, we would be much better off.

      Same thing happened in agriculture. Not so long ago 80% of the people were working on farming jobs, these days it is 1% at best. Technological advancements made the old processes obsolete. We get more food, and most people can do something else to be productive.
      Nick32768
  • A Sticky Wicket this is...

    The papers always can set their web-sites to not be crawled or indexed by Google. This, however, is on-line suicide and few would ever see the on-line version of the data.

    In someways this is sad. The internet, in setting up the democratization of information, has also de-valued the creation of information (An article about 2-3 years ago looked at Google as being the single largest destroyer of wealth on the planet.). There are plusses and minuses. The plus side is it is cheaper and the quantity is vast. The minus is it is often harder to actually find what you are looking for and, much worse, the quality of of information has plummeted. Blogs act like "reporting' but offer no in depth analysis to fact checking (ref: Mike Daisey's hit piece on Apple the media ran with).

    If you do traditional quality reporting, the costs are higher than the return to actually generate the data and information. There may be hope in maintaining small niche markets to have a small group of people doing very targeted reporting with search aggregating the results to a hyper-large audience. So instead of having several dozen major news agencies that cover everything you end up with 10's of thousands of small groups with information aggregated by search. Learning what ones to trust then becomes the hard question.

    The trade offs are tough. One mindset is: driving prices down is ALWAYS (without question) better for the consumer; is, however, "you get what you pay for" True? These are diametrically opposed views with truth in each.
    Bruizer
  • Solution will be simply pass the tax onto the user.

    Silly bureaucrats, you don't understand how the real world works. Pass your law, tax the business, then the business passes cost on to user. So if Google can figure out what data is French data, then that user is charged for giving it.
    alexanderofyork
    • .

      Google won't charge users for that data. they are more likely to eat the tax themselves or stop crawling french media, which as Bruizer has already said, is on-line suicide. Why manage an online presence if the search leader who owns over 70% marketshare is not linking to your work.
      ukjb
    • Re: Solution will be simply pass the tax onto the user.

      When was the last time you paid for anything from Google?
      ldo17
  • If Google stops providing service in France...

    I think Google holds a lot more cards here than the French government. All Google has to do is threaten to refuse Google services to French IP addresses on the basis that the government is strong-arming them and see how long it takes before the French politicians back down after an avalanche of public outcry.

    Not having Google is like not having the Internet. If the French government (and companies) are being so idiotic, they deserve to not have the Internet anymore. When they agree to mend their ways, viola, Internet (i.e., Google) back on.
    laughfactory
  • Google is a monopoly!

    Don't fall for defending Google, they have become a virtual monopoly in the new data age. Any government worth it's votes should always try and break up monopolies because they are never good for anyone! Google has every right to make advertising money from the internet but mining data and on selling it is a different thing all together. They should be taxed for this because they are using information from foreign countries without paying for it. Remember they started by advertising and no one is denying them that revenue stream.
    Tempestlight
    • And I can change my browser whenever I like...

      ...in seconds (I actually use DuckDuckGo and it works well). Try doing that with your OS.
      John L. Ries
  • Google should pay international taxes

    When a company seeks to mine the ground in a foreign country they are expected to pay taxes. Mining data should be no different.
    Tempestlight
    • My two cents...

      I agree with laughfactory; all Google has to do is cut them off from having their content indexed and they will quickly change their tune. Why should Google pay for the privilege of both advertising French content and making it easier for people to find? The idea itself is absurd and I hope they throw down the gauntlet and play hardball.

      @Tempestlight: Those taxes you speak of for mining metals/minerals/fossil-fuels are to offset the damage to the environment and the inconvenience to the citizens for not being able to use the area of land being mined for anything else. Mining data does not directly contribute to pollution. You could make an argument that for every bit of data being mined, somewhere someone is using energy to run the machine that is performing the mining - but then I could just as easily make a counter-argument that freeing up the computing power is pointless because it will simply be used by yet another party to mine other data or do some other task that uses an equal or greater amount of energy. Additionally, there is no inconvenience; if you don't want your data mined, don't use the service that depends on it. For example, as someone else mentioned, the French content has the option of formatting their robots.txt files to explicitly deny Google from scraping their servers for data. This is like that stupid case recently where the girl refused to wear an RFID badge at school and then complained because she couldn't use all the fancy services that the badge made possible. Choices have consequences, and you can't have your cake and eat it too.
      Dyndrilliac
    • If anything, the french media is making MORE money because of google

      Google is linking these media outlets to the internet. If anything these guys are probably making MORE revenue by being referenced by google. People arguing for this link tax act like google is copying entire articles into their search page and giving it away for free. You people have no idea... Google is taking the first two sentences and "teasing" the reader into clicking on the link and reading the article himself.
      ukjb