Editorial: Copyright holders win big in Europe, but at what cost?

The European Parliament approved a hotly disputed set of copyright rules for the digital age Tuesday, including a provision that shifts the responsibility for detecting and stopping infringement from copyright holders to the online companies that let users upload songs, videos, articles and other content. The rules, which still must be approved by the European Council and then implemented by the EU’s member nations, may not spell doom for the open internet in Europe, as critics claim. But what they will do to innovation and competition online is bad enough.

One of the stated goals of the directive was to help copyright owners strike more lucrative licensing deals with the popular sites where an enormous amount of music and video are played. That’s especially important to the music industry, whose business model has been walloped by the internet.

To that end, the directive would hold sites liable when their users infringed copyrights — not just when they uploaded a pirated Hollywood blockbuster or hit single, for example, but also when they shared a recording of their children singing a popular song, or posted a video with a segment cut from a superhero movie. That means sites like YouTube and Facebook will be under pressure to use content-filtering technology to detect copyrighted material and block anything they haven’t licensed. And because the technology isn’t capable of filtering out every copyrighted work, sites will also be under pressure to obtain licenses to let users post content from the vast population of music, television and movie copyright owners — a task that critics of the directive say is next to impossible.

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The risk and cost imposed by these provisions is so significant that only companies the size of Facebook, YouTube and Twitter are likely to remain open to users posting and sharing content freely. Ironically, the measure could drive off smaller companies that cater to upstart musicians and filmmakers looking for a low-cost way to market and sell their work online, simply because they can’t afford the filtering technology and licensing deals they’d need to guard against users infringing someone else’s copyrighted material.

From that perspective, the balance struck in U.S. law — where people posting content are liable if they infringe while the sites are required to take down works when notified of infringements — is the better one, even though copyright owners have legitimate complaints about how hard it is to rein in piracy. The U.S. model has allowed companies and creators to innovate without having to seek permission from copyright holders, as long as they do not infringe. The new European Union directive threatens that spirit, to its members’ detriment.

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