The Great Intermediary War

When the history of the Internet is written down (again), the annals of the years 2009 and 2010 will describe the consolidation of social media, the rise of Twitter, but more importantly, it will be known as the period when regulators and industry tried to tackle intermediaries.

This has been some time coming. At some point in the past three years, content owners discovered that suing their customers was not such a good idea after all, and while keeping up the pretence of conducting the War Against Piracy, their sights were set on another front, much like Hitler giving up on the Battle of Britain and looking at the Soviet border longingly (Godwin’s Law has been invoked, you may cease to read if you want). For the last ten years (give or take a couple), intermediaries have been exempt from liability for infringement undertaken by their customers. The consensus has been that intermediary liability exemption is a Good Thing, as it would be impossible for any internet service provider to monitor and filter every transaction by their customers.

Fast-forward some years, and the picture has changed immensely. Intermediaries used to be small and meagre operations that did not have enough money to pay back in case of litigation. But with the appearance of large aggregators and other powerful intermediary services such as Google, the possibility of making these providers liable became greater. The cluster of lawsuits against Google that we have witnessed in the last few years has been the result of this change in strategy. However, service providers are still protected by safe harbours and other liability dampeners. What to do?

The answer to this question has been to undertake a double-pronged approach. Why not turn internet service providers into policemen? Let them do the unpopular work of slowing down and disconnecting users if they engage in infringement, all you have to do as a rights-holder is to point them in the right direction, or at least point them towards an IP address that may or may not be accurate. Let the ISPs deal with the angry customer and the lengthy appeals process. This is in a nutshell the rationale behind three-strikes, be it HADOPI, ACTA or the Digital Economy Bill.

The second part of the strategy is to try to erode the power of the aggregators by erecting pay-walls and removing content from search engines, as has been proposed by Rupert Murdoch. This is a much trickier proposal. There is no doubt that newspapers and traditional media are struggling due to the Internet. How they respond in the next year may make or break entire companies. Nonetheless, the idea is compatible with the three-strikes one. At the heart of both suggestions there is the recognition that intermediaries have had a free ride for too long, and the time of reckoning is nigh.

While I empathise with the newspaper industry, I am afraid that many of the solutions offered will not work. There is a good reason why newspaper sales are down, and it has nothing to do with Google. People are getting their news in different places nowadays. It is quite indicative that the news of Michael Jackson’s death was first broken by the entertainment website TMZ. Many of us heard of the news first from Twitter or Facebook. Like it or not, the authoritative top-down approach can no longer keep up with people’s information consumption habits. Those who survive the next year will be the businesses that realise the changing nature of the market, and adapt accordingly.

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