Google may continue to operate its News Showcase offering. However, the digital group must not act more as a publisher itself than it has in the past, by displaying news content directly on the Google search page, so that users no longer have to switch to the websites of the media houses. That’s what the Federal Cartel Office decided, as the authority announced on Wednesday.
In October 2020, an investigation against Google began following a complaint from the collecting society Corint Media (formerly VG Media). From their point of view, Google used its market power to use the News Showcase program to get the participating publishers to partially assign their press ancillary copyright – i.e. the right to be paid appropriately by digital platforms for the presentation of press products. Google gives the media companies money for participating in the program and thus buys their approval for individual contracts in which the media companies squander their press content “at dumping prices”. That undermines the legal claim that a collecting society like Corint Media could collectively exercise.
No agreement in the dispute between Google and the collecting society
The Bundeskartellamt apparently shared these concerns. However, following the agency’s intervention, Google changed its contract practice to the effect that the Showcase partners can also be represented by a collecting society and can license their ancillary copyright “separately from a Showcase contract”. In addition, participation in the Showcase program will not determine how far up a publisher’s media content appears in Google’s search.
The group has according to their own statements Contracts signed with 32 German media companies that issue more than 100 publications. The SZ also takes part in the program. The press publishers curate particularly prominent areas in Google’s news offering – in the corresponding app and via news.google.com – and receive remuneration for this.
Corint Media asks Google 420 million euros a year, in order to then distribute them to the publishers. Google, on the other hand, prefers to conclude individual contracts and offers the collecting society 3.2 million euros. This dispute is open. The Cartel Office reports that it has persuaded Google to offer higher remuneration until clarification is reached, “which was at least on the level of the license agreements concluded individually between Google and individual publishers”.
Arbitration proceedings at the German Patent and Trademark Office should finally decide on the dispute. The Federal Cartel Office does not want to get involved. However, it reserves the right to participate in the process as an “amicus curiae” in an advisory capacity.
The competition authorities received new powers from the legislature last year to secure competition in the Internet economy. Since then, the Cartel Office has been able to more easily determine a company’s market dominance and intervene to prohibit certain types of behavior. In the case of Google, the office had certified the group’s outstanding cross-market importance on the basis of the new powers. This opened up the possibility of being able to prohibit anti-competitive practices in a second step.