Web Hosting Services Would Also Be Hit By Article 13 Requirements

As the European public digests the reality that article 13 is heading their way, European digital rights advocates are warning that hosting services would also be impacted.

While the European commission is dismissing activism surrounding article 11 and article 13 as “fake” (only to retract the anti-European piece later on), actual digital rights advocates are continuing to offer information of what is really on offer with this copyright directive.

European Digital Rights (EDRi) is currently pointing out that article 13 would also impact web hosting providers operating in the continent.

The point is definitely interesting because much of the discussion surrounding Article 13 revolves around social media platforms and meme’s. Will memes get banned in Europe because of the censorship machines? Will the Facebook’s and YouTube’s of tomorrow die before being born because of onerous fees being tied to mandatory censorship systems? All of these questions are perfectly valid, but it seems that they aren’t the only ones.

From EDRi:

In its current version, Article 13 will bring direct liability for hosting providers.

Internet hosting services would be automatically considered to be performing a “communication to the public” when copyrighted material (or “other subject matter”) is hosted by them, regardless of whether it was uploaded by the company itself or by a user. The internet services shall then make “best efforts” to conclude licensing agreements with the rightsholders on any piece of copyrighted material (potentially every article, image, audio file and video uploaded to the internet). It is unclear how that will work in practice. Nevertheless, the elimination of the intermediate liability exception will likely leave companies no choice than to monitor every piece of content that is shared and uploaded on their platforms.

The only services to be exempted from liability, as introduced in the final deal, would be the few platforms that would fulfil the accumulative criteria that the online platform is:
(a) less than three years old
(b) making less than 10 million Euro annual turnover and
(c) visited by less than 5 million unique visitors a month.

This proposal has worsened many better versions that were discussed before in the European Parliament. It further ignores the main critique against Article13 – upload filters empower (mostly US-based) Big Tech companies to decide on restrictions on freedom of speech in the EU.

While web hosting companies might sound like a smaller side industry in the big picture for some users, this is actually a very big deal in the world of web. There was a time where most websites were operated by having a couple of computer towers stuffed in garage’s or basement. The pitfall here is that those web administrators needed to know how to run a web server, keep it secure, maintain DNS registry entries, etc.

While that concept may be nostalgic or empower the more elite web crowds, the knowledge barrier has been significantly reduced thanks to hosting providers. Now, instead of requiring knowledge and time to maintain a server just to get online, potential webmasters can simply rent server space from hosting providers. The providers can maintain the servers while the webmasters pursue the dream of potentially one day owning a major website on the Internet. In short, a lot has changed from the 80’s and 90’s.

Today, a large percentage of websites rely on third party services. Arguably, these services have helped enable free speech online in the process.

If webhosting providers suddenly have a requirement to ink licensing deals with rightsholders under the premise that someone could use copyrighted material, a lot of smaller providers could find themselves going bankrupt in a hurry. This would also leave the larger providers who now suddenly need to implement censorship filters. That would put them at a huge disadvantage to non-European services who wouldn’t need those licensing deals to begin with.

Additionally, having to constantly monitor for copyrighted material means that the cost overhead is going to shoot up. You’re going to need to hire people just for the purpose of maintaining moderation. With the licensing deals and having to maintain some mechanism of enforcement as mandated by law, the prices are going to go up. If anything, webmasters are very sensitive to fluctuations in price. That alone will drive a lot of customers away from European providers. So, this sets up a double-whammy for European providers who need to push prices up while at the same time will be forced to watch customers flee to cheaper deals overseas. After all, the Internet is a global phenomenon. Nothing is stopping a European webmaster from renting server space in Canada for instance.

While there are immediate negative impacts on how webhosting is handled, there is also the potential side effects of all of this. If web hosting providers go out of business, that’s tax revenue that is going to vanish. Some webmasters might not be very savvy. If their hosting provider goes down in flames because of onerous licensing, they might decide that the Internet just isn’t for them. So, they might close their service down in the process. That’s even more potential tax revenue that is vanishing. On top of that, a lot of jobs could be lost if all of the above goes under which means economic spinoffs go up in smoke.

Some might argue that this is a reasonable sacrifice to save the poor starving artist. There is no shortage of artists who got their start online. Even though it is a proven rip off to get a major record deal, some artists show off their social media following as a method to getting a better deal. Some build their own sites and generate a solid presence online so they can prove to companies that they are worth “investing” in. Eliminate the providers and the platforms and you significantly undermine a new artists chances of success.

What all this represents is one of the many attack vectors into the foundation of the Internet by Europe’s copyright directive. This particular reason is not something that should be underestimated.

Drew Wilson on Twitter: @icecube85 and Google+.



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