Article 13 can destroy my StartUp

Article 13 of the European Copyright Directive, which is in the crucial final part of the amendment phase, undoubtedly constitutes a serious threat to freedom of expression and the right to privacy, as has been pointed out on a number of occasions by various collectives and organisations, who have dubbed it the “#CensorshipMachine”.

However, those aren’t the only catastrophic consequences that the new rules would bring about. Other consequences include directly undermining entrepreneurship, competitiveness and the emergence of new start-ups, acting as a braking force on the innovation that these new smaller companies bring to the table in terms of technology and society in general.

The reform introduces a de facto obligation for information society service providers to implement content recognition technologies - in short, "content filters" - that have to be applied to all data hosted on their platforms. The aim is to force private European companies to bear the costs of investing in expensive, complex, imperfect and constantly changing technologies that do not bring any added value to their activity.

The costs and development efforts involved in implementing this are so high that many start-ups will not be able to compete on equal footing, while companies like Google have the resources to develop their own tools in-house. They will be forced to use what scant resources they have available to demonstrate that neither they nor their users are breaching the unclear rules in the Directive. In direct contravention of the principle of presumption of innocence, it exposes business to legal uncertainty, chilling innovation and entrepreneurial activity, while inhibiting private sector investment that will soon be more likely to be tempted by less expensive, less risky investment opportunities in other types of new businesses.

The proposal is also vague as to what types of content the recognition technologies should be applied to, implying that any format will be vulnerable to being tracked.  Current legislation on Intellectual Property in Spain states that it considers copyright protection extends to: 

     [...] all original literary, artistic or scientific creations expressed in any medium or format, tangible or intangible, currently known or which may be invented in the future.

How much will it cost to develop the technology to analyse all of that? How much will it cost to keep all of the technologies used up to date?  Will a small business really be able to take on the cost of this development? In many cases, they will be forced to resort to paying much larger companies to purchase the privative technology, which has taken many years and millions of dollars of investment to develop, resources that just aren’t available to smaller businesses. As Google itself has stated, YouTube has invested more than 60 million dollars in Content ID, a proprietary system of content recognition, and that’s only usable on video.

Imagine a start-up that has developed software for cloud storage and online office programs. In addition to overcoming the economic obstacles involved in the titanic effort of launching and maintaining a start-up, they will also have to ‘spy’ on everything their clients do, whether or not they intend to breach the law or use material protected by copyright. 

Platforms such as GitHub and Stackoverflow, where users share code and solutions to IT challenges, would never have seen the light of day, and may now perhaps even be forced to close. The safe option is, obviously, to simply move out of Europe, to a jurisdiction with more predictable and proportionate copyright laws.

The proposal requires collaboration between service providers and copyright holders (it should be remembered that in most cases, these are not the same person as the authors themselves, but rather are represented by the content industries). In particular, service providers must provide copyright holders with information on the type of technologies used, the way in which they are used and their success rate in recognising the copyright holders’ content.  This necessitates not only extensive technological resources but also the human resources required to administer and manage the relationship with the copyright holders.

Those who support this law will be directly responsible, in the best of cases, for having frozen innovation by forcing many initiatives to abandon their plans and dedicate the talent of their staff to develop tools whose benefits are unproven and doubtful but whose costs for businesses, citizens, innovation and the European economy are huge and beyond doubt.