Google(s goog) proposed an annual €50 million payment to news publishers to resolve a long-simmering copyright dispute, but the publishers decided to hold out for more, according to a report Friday in Le Monde. The offer came before Christmas as part of ongoing discussions over whether Google should pay to index web content.
According to the report, French publishers turned down the €50 million (USD $66.6 million) offer and demanded a figure of €70 to €100 million instead. They also objected to the way Google proposed to disburse the money. The company reportedly offered to spend a third of the €50 million in the form of direct ad purchases while using the rest for commercial advertising partnerships between Google and the publishers. The publishers reportedly complained that too much of the proposed money was contingent on sales figures.
The proposed deal would have been similar to the one Google reached with Belgian newspapers in December. The Belgian deal, in which Google paid about $6 million, allowed Google to claim that the money was part of a partnership venture — and not a copyright pay-out. Google has long insisted that copyright law permits it to index webpages and, in some cases, offer news snippets.
Unfortunately, Google has a weak hand in France and elsewhere in Europe, where cash-strapped governments are backing the efforts of troubled publishers to wring money from the American company. The failure to reach a copyright deal is likely what drove the French government, which supports the publishers’ position on copyright, to propose an “internet tax” last week on Google and other U.S. tech giants. As the New York Times reports, the Europeans are frustrated by American companies’ use of sophisticated accounting techniques to pay a relatively small amount of income tax despite earning large revenues in Europe.
The current situation places Google in a bind. It can accede to what it regards as unreasonable copyright demands from the publishers, thus encouraging publishers in other countries like Germany to show up looking for money. Or it can hold its ground against the publishers and risk getting hit with even worse penalties from Europe’s national governments. Google did not immediately return a request for comment.