The UK Court of Appeal issued a ruling upholding the original High Court judgement in favour of the NLA in November 2010. The court confirmed that commercial consumers of web content need a licence from the publisher to view content.

Web licences
In the case of UK newspaper publishers licences are issued by the NLA. Conceivably other licensing agencies could be created to police niches on the internet where web content is shared for commercial gain.

The Court said that the technological process of displaying a web page on a computer is not exempt from copyright.

“This positive interpretation of UK copyright law provides legal clarity and certainty for all players in the market,” said David Pugh, managing director, NLA.

“Publishers can be sure of fair royalties for the use of their content, suppliers of paid-for online monitoring services will benefit from a level playing field and clients of such services know that their licence provides a simple way to guarantee compliance with the law,” he added.

Meltwater and the PRCA are seeking permission to appeal this decision to the UK Supreme Court.

Personal versus commercial
The issue remains between commercial monitoring and personal usage. Google as a consumer search engine falls outside the NLA licence scheme.

“The NLA has dodged taking on Google because of size. Any solution that excludes Google is ignoring its massive presence in the industry,” said Ingham.

The story will continue at the Copyright Tribunal in September when Meltwater will seek a ruling on the fairness of the NLA’s licensing scheme.

“We are confident that the Copyright Tribunal will rule the NLA licensing scheme is over-reaching and unreasonable,” said Jorn Lyseggen, CEO, Meltwater.

In the meantime if you’re an agency or company that uses a commercial monitoring service such as Meltwater you’d be well advised to set aside fees for when the NLA comes seeking backdated settlements.

“We’ve advised PRCA members to set aside fees from the outset,” said Ingham.

You can calculate the likely cost to your organisation by using the NLA Web Fee Calculator. By my reckoning a 10-person agency sharing 100 links a week should expect to pay £300 per year, while a 50-person agency sharing 500 links a week should expect to pay £1,260 per year.

Content costs but who pays?
The root of the challenge to the NLA licensing issue lies in its newspaper publisher members fooling us into thinking that their content is free on the internet. In the 90s business models were set aside in the race for eyeballs as newspaper publishers made their content available for free.

Steve Kuncewicz, social media and intellectual property lawyer at HBJ Gately Waring LLP has gone further in media interviews today. He told The Drum that the ruling is a bid by the newspaper industry to retain revenue while the traditional publishing model fails.

Ultimately this on-going case must surely hasten a review of intellectual property law in the UK. It’s a point that Kuncewicz makes to The Drum.

“There’s a widening chasm between how we use the internet and the law. We’ll look back at this debate in five or ten years’ time and it will be a tiny parenthesis in the history of copyright in the UK,” said Lyseggen.

Speed is a Meltwater customer and a member of the PRCA.

Related blog posts:

• NLA ruling “absurd” says Cambridge IP Professor as Meltwater and the PRCA head back to court – 6 June, 2011
• Tackling copyright confusion and why Google isn’t a British firm – 20 May, 2011
• Meltwater expected to appeal High Court decision on NLA web licensing – 10 December, 2011
• NLA’s High Court ruling contradicts Sir Tim Berners-Lee’s vision of net neutrality and an open web – 29 November, 2011
• NLA vs Meltwater: See you in court – 28 October, 2011
• NLA seeks High Court ruling on Meltwater challenge to web licensing – 24 May, 2011
• Links: a means of distribution, not an economy – 18 January, 2011

To concisely re-cap: from early 2010, anyone copying and supplying UK newspaper web content to others for a fee (monitoring or press clippings agencies to PR agencies, for instance, and from those PR agencies to their clients) must acquire a license from the Newspaper Licensing Agency (NLA), a body that’s owned by the mainstream media.

Software and services company Meltwater (which provides media monitoring services to PR agencies and others) filed a legal challenge at the end of 2009; the Court of Appeal in London ruled on that challenge earlier this month, the detail of which they’ll publish soon.

Now, Meltwater and the Public Relations Consultants Association (PRCA) have prepared a template letter (which I’ve  uploaded to Scribd and embedded below) that anyone with an opinion on this issue can use as a means of raising its profile with their MPs.

Here’s a recent blog that I wrote with background on the issue.

I was keen to get his view on the recent High Court judgement that found in favour of the NLA’s web licensing scheme.

Steve believes that Meltwater will appeal the judgement and that it could result in a reappraisal of copyright law to deal specifically with the Internet. In his own words:

“Copyright law has always been about the ability to generate an income out of intellectual ability. However, there’s a growing tension between the old copyright model and the new digital world – this decision is based on a ruling from the European Court of Justice that an 11-word extract from an article can be protected by copyright as a ‘literary work’.”

“For years, it’s been argued that a headline alone can’t be protected as a literary work because it’s simply too short – try telling that to journalists who’ll argue, with some justification, that coming up with a headline that connects a piece to its audience isn’t as skilful and worthy of protection as the article as a whole.

“That said, this ruling created a dangerous precedent by taking the strict letter of the law and applying it in a way which simply doesn’t fit with the business model of a whole industry.

“Although the ruling may be strictly correct in legal terms in that fair dealing can’t be used as a defence without a proper acknowledgement (which Meltwater don’t provide), this puts the PR industry in a very difficult position if the decision holds up, but the idea that this kind of linking to a URL that contains a headline is very dangerous – the PRCA has been dragged into a major dispute between publishers who see monetisation of content as the only way to generate revenue and a news aggregation service which is seen as the enemy by UK copyright law due to the fact that they provide a commercial service rather than links provided in the public interest.

“This case only adds to the need for copyright reform to deal with businesses that are looking to thrive in a knowledge economy – if this judgment holds up, then the NLA will have a monopoly that even the old system couldn’t have intended. Meltwater would have to change their business model and PRs avoid sending aggregated versions of the coverage they generate.”

“The legal principle is established: end-users need a licence to use paid-for media monitoring services incorporating newspaper web content. We will now proceed to the Copyright Tribunal [in February 2011] for a ruling on the commercial terms of both our web aggregator and end user licences,” said David Puge, managing director, NLA.

Paid Content has produced a summary of what the ruling means for PR agencies – NLA Ruling Summary: How PRs break copyright law online.

According to the Media Blog, the ruling effectively affords inbound internet links a copyrighted status that would require any businesses circulating them to obtain a licence from the NLA.

Meltwater and the PRCA are expected to appeal Mrs Justice Proudman’s ruling.

“[The] decision is fundamentally flawed – it risks putting an end to the freedom with which information can be shared on the Internet. In the coming days we will work with our lawyers to examine the grounds for appeal,” said Richard Ellis, communications director, PRCA.

Here’s an ironic twist. In a rallying cry in Scientific America last week Sir Tim Berners-Lee, the Brit that invented the web, called for the defence of open standards on the internet, taking issue with threats to neutrality and an open web, ranging from iPad applications to traffic shaping and from social networks to packet-level snooping.

It will be sometime before the media develops business models that see journalists and publishers properly rewarded for the publication of online news. Until then the NLA licensing scheme will remain a contradiction between the vision set out by Sir Tim Berners-Lee of an open web and the ability for a news publisher to generate sustainable profits online.

There are two fascinating postscripts to this story that might be worth exploring following the High Court judgement.

As Jason Stammer writing in the New Statesman says newspapers are increasingly using search engine marketing techniques to attract the attention of Google. A timely story about a frequently searched for brand will guarantee traffic to an online news site as readers seek out information about the brand. But newspapers don’t have to pay anything to brand owners for use of their brand.

Similarly stories that are second sourced via the web are becoming commonplace and are easier than ever to track a story online to its source. PR academic David Phillips has traced the lineage of news content as it spreads across the web. As Phillip’s says we’ve yet to see a counter organisation to the NLA set up to get their money back from newspapers that source content from online communities.

The NLA’s aim is to seek legal clarity on its licensing for the after market of web content. It believes that an agency or client that receives headlines, summaries and URLs, from a web aggregator or monitoring agency such as Meltwater, should be covered by a NLA licence.

Meltwater has the backing of the PRCA and believes that the NLA’s proposals for a web licence are flawed. The case is due to be heard sometime after 8 November.

If the NLA is successful the High Court case will be followed by a hearing at the Copyright Tribunal in February 2011, where Meltwater is seeking to establish whether or not the NLA’s web licensing scheme is fair to newspaper publishers and organisations that participate in the after market for web content.

Some newspaper publishers aren’t hanging around for either verdict. PaidContent reported in July that a number of newspapers were taking direct action to stop Meltwater from aggregating their content.

“The UK’s most popular online newspaper website has joined News Corp.‘s The Times, The Sun and News Of The World sites in barring the online media monitoring service Meltwater from crawling its articles, with a court action pending between UK newspapers and the company.”

Digital disruption
At Speed we’ve followed this issue for the past 12-months. It’s symptomatic of the state of the media and the disruptive nature of digital publishing. We’ve been fooled into thinking that online content is free by the NLA’s newspaper publisher members.

Up until recently these publishers have been willing to give away editorial content online for free in a bid to secure traffic around which they could build advertising revenues. It’s a model that has failed in all but a few exception circumstances.

The premise of both cases concerns what is free and what is fair. The media has hidden from these issues for too long. This High Court case is the thin end of the wedge and will surely flush out what the industry must confront.

Content costs
If business-to-business aggregators and press clipping agencies are generating an income from original content produced by a newspaper either in print or online shouldn’t they make a contribution to the original source?

We can argue over whether the NLA’s model is appropriate and how it should be applied throughout the PR supply chain but at its core the NLA is seeking to ensure that its members receive a contribution from anyone that generates income from the after market for their content.

It’s true that the income that is generated from the NLA’s web licensing scheme won’t prop up news print but the principle at stake is one of fairness. If you reuse or repurpose my content commercially I want a share of the action.

Try arguing against that point with a journalist that finds themselves out of work as publishers attempt to square-up to falling ad revenues and reorganise around a multi-channel proposition.

Google
The NLA remains insistent that Google as a consumer-facing service is not part of this debate and that its members have their own direct deals in place with the search giant.

I’m sure that this is an issue that Meltwater will challenge in the High Court. Google Alerts and Google News are almost certainly the most widely used frontline monitoring tools by agencies and brands in the UK and US.

Related articles

• Interview: Meltwater CEO Lyseggen Will Fight UK ‘Link Tax’ On Two Fronts (paidcontent.org)

Content from News International titles has been withdrawn from media monitoring agencies and aggregator services and won’t be available until the launch of the Newspaper Licensing Authority’s (NLA) eClips platform, expected sometime in September.

NLA channel partners such as Cision, Durrants and Precise will provide their clients with News International content via the eClips platform as part of their monitoring services.

Meanwhile, the FT has pulled out of the NLA scheme and has launched its own digital searchable archive. In future media monitoring agencies and their customers will need to purchase a licence direct from the FT once their current NLA licence expires.

Is this the thin end of the wedge for the demise of the ‘pay once and you’re protected’ approach to media copyright management?

“The FT has been developing a direct licensing philosophy for some time. [It] wants a direct customer relationship, so that whilst the channel (aggregator or press clipping agency) may charge for its service, only the FT can charge for its content,” said David Pugh, CEO of the NLA.

“Collective licensing is valuable for publishers and clients alike – but the FT feels that it has a unique position as a global brand with niche content and expertise – and their view is that this is best managed by them directly,” he added.

NLA managing director David Pugh says that he wants to clear the matter up at the earliest opportunity rather than waiting for a judgment from the Copyright Commission in February 2011.

“We believe that clarity on all aspects of our web licences needs to be achieved as quickly and unambiguously as possible. The Copyright Tribunal will rule on the commercial aspects of NLA web licensing […] but the High Court is the proper place to decide on the legality of our web licences,” said Pugh.

We’ve followed this issue at Speed for the past year and whenever I hear of mates in the media losing their jobs I return to the issue.

We’ve been fooled into thinking that online content is free by the NLA’s newspaper publisher members.

Up until recently these publishers have been willing to give away editorial content online for free in a bid to secure traffic around which they could build advertising revenues. It’s a model that failed in all but a few exception circumstances.

We almost certainly won’t be having this argument in five or ten years time because by then publishers will either have gone bust or will have established robust financial models and mechanisms for protecting their content.

But for now the question remains. If business-to-business aggregators and press clipping agencies are generating an income from original content produced by a newspaper either in print or online shouldn’t they make a contribution to the original source?

We can argue over whether the NLA’s model is appropriate and how it should be applied throughout the PR supply chain but at its core the NLA is seeking to ensure that its members receive a contribution from anyone that generates income from the after market for their content.

It’s true that the income that is generated won’t prop up the ailing newspaper industry but the principle at stake is one of fairness. If you reuse or repurpose my content commercially I want a share of the action.

The NLA remains insistent that Google as a consumer-facing service is not part of this debate and that its members have their own direct deals in place with the search giant.

I struggle with this argument and am sure that it’s this issue that Meltwater will challenge if it can afford to pursue the case via the High Court. Google Alerts and Google News are almost certainly the most widely used frontline monitoring tools by agencies and brands in the UK and US.

The NLA’s own estimates put annual revenues for the scheme at £2 million. Meanwhile, the Guardian alone is reportedly losing £36m per year, or £100,000 per day.

Under the NLA’s leadership the newspaper publishing industry believes that it should benefit from any income generated by third-parties that sell products or services based on content generated by NLA members.

The Financial Times and The Times have opted out of the scheme and plan to implement their own independent licensing models.

The NLA scheme has seen aggregators, clipping agencies and PR firms subject to a levy from the start of the year. But the NLA isn’t charging Google claiming that it is aiming its scheme solely at business-to-business users.

The PR industry body PRCA and clipping agency Meltwater are challenging the NLA’s scheme via the UK Copyright Tribunal with the claim that effectively charging from links is an affront to democracy and the openness of the web.

Here’s my interview with Vikki in full.

The action by The Times to block News Now and now Meltwater is another example of a publishers setting out the battlelines in the fight to challenge the business model of aggregators and online clipping agency. The move will inevitably hurt Meltwater. Clients rely on it to provide a comprehensive service and a fragmented monitoring service isn’t helpful if you are charged with managing the reputation of a business.

But it’s odd that The Times is taking this direct action against Meltwater and News Now yet News International is not exercising the NLA’s new web clipping license despite being an NLA member. It shows the ongoing turmoil in publishing industry and it attempts to shift from print to online.

The publishing industry is in real pain as it attempts to monetise its content online. Ad revenues have collapsed and circulation figures are down. Publishers are seeking to create new business models around their content online and believe that third parties that generate income from aggregating and monitoring their content should share the income they generate.

Attitudes will change over the next 18 months as newspaper publishers raise paywalls in front of their sites – and news articles are replaced by summaries in Google News searches.

It’s a long way from the 100,000 signatories that Cameron says will be required for an issue to be debated formally in the House of Commons but the issue continues to cause a stink and has passed the 500-threshold where it requires a response from Downing Street.

The move follows an amendment to the Digital Economy Bill tabled by Lord Lucas that would ensure “protection of the right to link to publicly available information on the internet.”

But the NLA’s managing director David Pugh said that he believed that Lord Lucas’ amendment was a bid to flush out views and is unlikely to become law.

“It is a fundamental principle of copyright that content owners can control the way in which their content is exploited. The market adequately addresses this issue already through website terms and conditions and licensing,” said Pugh.