Spain cuts the fabric of the Internet with its new tax

The Internet is a collection of different sites interwoven together through “links.”  Now imagine an Internet without links.  Can’t do it, can you?  That’s because the web depends on interconnectivity of content - it is the thread that makes up the fabric of the internet.  But some aggressive European countries seeking to wangle in and wrangle money from the online world want to limit online links. 

We all know about the new European requirement for search engines to remove links – but now Spain wants search engines to pay for just displaying links.  Under Spain’s new linking “tax,” any search engine that displays the title of a Spanish newspaper article must pay for the display.  For example, when displaying a search for “Spanish Bull Running,” Bing must either pay El Correo for the privilege of displaying a link to their bull running story, or remove the newspaper from the searchable internet.  It is certainly easier and less expensive to just delist and likely that is what search engines will do. 

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If forced to delist sites, users will struggle to find the information they seek and/or overlook lesser-known webpages.  The European countries imposing this linking tax harm users and their own publications.

Spain’s new tax doesn’t allow its news sites to opt out.  This means that even if a newspaper wanted to let Google freely post it’s content – it can’t.  For the big publishers, it’s not a big deal – people visit them directly.  But the law reduces traffic to smaller newspapers sites struggling for prominence.  What’s more – if the publishers don’t want their content made available on search engines, they can remove themselves any time they’d like through the robots.txt file in every website that can instruct search engines not to index it.

Along with the loss to users and Spanish publications, this tax costs Spain’s already-moribund economy.  This cost to Spain isn’t speculation.  The implications of this tax include a decline in economic activity, productivity, and creation of an uncertain regulatory environment.  Coalición Pro Internet estimates this damage to the Spanish Internet industry at 1.1 billion euros ($1.48 billion dollars). 

Spain isn’t the first country to try this misguided approach to cut online links.  In 2005, the French press sued Google for linking to their articles. After Google agreed to remove all content, French news sites similar to Drudge Report, effectively disappeared from the Internet.  One now closed site, PoliticalGateway.com, summed it up nicely, “no news aggregation, no news syndication, no news on search engines, no readers can find us, no traffic. Add all this up and you can see the economic value of the site is gone.”

Yet again, European lawmakers are working to solve problems that don’t exist in order to protect legacy industries. There is no competition between the media and the news aggregators they rely on to drive traffic to their sites.  Instead of looking at the linking fabric of the internet as something to mutilate, Spain should instead wrap itself in the economic benefits of the internet and repeal its new tax.

Szabo is policy counsel for NetChoice, a trade association representing e-commerce businesses and online consumers.