October 10, 2019

Digital Services Act: Lets talk about objective and values before retreating into the trenches

By all accounts Tuesday's confirmation hearing of Margrethe Vestager, the designated European Commission Executive Vice President in charge of making "Europe fit for the Digital Age" went pretty well for her and she easily convinced the MEPs that she is fit for the job. Unsurprisingly (given her track record) most of the discussion focussed on issues of competition, taxation and the bigger question of how to ensure that that the European economy can remain competitive in the digital environment.

Among the few exchanges that touched on concrete policy actions her response to a question from MEP Angela Niebler on the just completed EU copyright reform was somewhat noteworthy:

“I am myself very happy with the outcome” of the EU's copyright reform, Vestager told European People's Party MEP Angelika Niebler. The “divisive and strong” debates during the copyright reform process will likely come back during the Digital Services Act, she said. The copyright acquis should not be re-opened in the upcoming legislation, the Dane added. (via politico.eu)

There are lots of reasons to disagree with her assessment of the outcome, nevertheless it is understandable that she is happy that the Commission managed to get the Copyright Directive passed after all, as this feat is widely seen as a political success for the outgoing Commission. Still it is somewhat worrisome to see Vestager fail to reflect on the outcome of the copyright fight in any meaningful way[1] and this failure to reflect does does not hold a lot of promise for the upcoming period including the much hyped fight about the Digital Services Act.

Instead of assuming that the Digital Services Act will lead to "divisive and strong debates" it might be better to analyse why the copyright reform process ended up being so divisive:

One of the lessons that can be learned is that there needs to be a discussion about the policy objectives first and that discussion needs to be disconnected from a discussion about the policy instruments that can be used to achieve these objectives. In the case of the copyright reform, the policy objective (to ensure that more of the value that dominant internet platforms created by using the output of European creators and creative businesses ends up with them) enjoyed much broader support than the policy measures proposed by the Commission.

Unfortunately this policy objective was never really discussed in public, instead the Commission (in concert with influential Member States) defined this policy objective behind closed doors and happily embraced the legislative approach that the creative industries presented to them based on their decade long desire to strip online intermediaries of their commerce liability privileges (which is the core element of what would become known as Article 13/17).

By coming out with a proposal that tied the policy objective (shift value from the big platforms to creators) with a concrete (and deeply flawed) policy intervention the Commission effectively pre-empted any chance of a constructive discussion about policy objectives and set the stage for the "divisive and strong" discussions that Vestager seems to accept as a given when it comes to legislative interventions in the digital space.

In the light of this experience it may be worth to have a broad discussion about the objectives and values of a new regulatory paradigm for platforms before any decisions on the nature of the legislative intervention are taken. Such discussions need to take place in the open and go beyond the form based consultations that the Commission has held in the past.

  1. Another reason why Vestager's apparent content with the outcome of the copyright reform process is disappointing is that there are strong indications that the legislative package will fail to achieve its intended effect (see Google's recent decision to remove content from French news publishers who do not grant them a free license to use their content). Given her current and future role as competition Commissioner Vestager of all people should be able to recognise that the old trick of granting (more) monopoly rights to content creators has very limited effects on the ability to negotiate better deals with dominant aggregation platforms that are largely demand-driven. The most likely lesson that we can learn here is that copyright is not necessarily the most effective legislative tool when it comes to reigning in dominant platforms that are able to capture a disproportionate share of the value created online. ↩︎