Associated Press Sues News Aggregation Service for 'Parasitic Business Model'

By Michael Nunez | February 15 2012 1:42 PM

The Associated Press, the world's oldest and largest news-gathering organization, which began in 1846, is making good on its threat to sue content aggregation news services, alleging Tuesday that a paid-subscription company's repackaged content works on a parasitic business model.

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The Associated Press, the world's oldest and largest newsgathering organization, is making good on its threat to sue content aggregation news services, alleging Tuesday that a paid-subscription company's repackaged content works on a "parasitic business model." The 135-page suit against San Francisco-based company Meltwater News begins with a thudding blow: "Meltwater has built its business on the willful exploitation and copying of AP's and other publishers' news articles for profit," writes the AP in the initial lines of the filing.

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The 135-page suit against San Francisco-based company Meltwater News begins with a thudding blow: Meltwater has built its business on the willful exploitation and copying of AP's and other publishers' news articles for profit, writes the AP in the initial lines of the filing.

Meltwater has built its business on routinely copying, verbatim, the heart of AP's and other publishers' stories, and selling that infringing content to its subscribers.

In contrast to the practice of other news sources and news aggregators who deliver the AP's news reports to the public, Meltwater does not license the content that it delivers to its subscribers. Google News, Yahoo News, and AOL for example, have negotiated arrangements with AP to distribute its content.

Meltwater has about 18,000 customers, reports Ars Technica. Customers pay Meltwater at least $5,000 annually for searchable content collected from 162,000 news sources.

The AP is asking a federal judge to block the service from continuation and seeks damages up to $150,000 per infringement.

Meltwater responded to the suit in a blog post on the company website.

It said:

We have today become aware of The Associated Press' filing of proceedings against Meltwater in New York. This is the first we have heard of the AP's concerns and we are surprised. From their press release, it appears that the AP misunderstands how our service works in many key respects. It is unfortunate that the AP did not seek to discuss this with us prior to taking this wholly unnecessary step. We invite the AP to enter a dialogue so that we can better understand their concerns and so they can accurately understand how our service works.

Meltwater respects copyright and operates a complementary service that directs users to publisher websites, just like any search engine. We do not understand why the AP has chosen to single us out or launch these proceedings without notice, though we note the coincidence that the AP's press release came out at exactly the same time as the UK Copyright Tribunal issued a major decision in favor of Meltwater in the UK.

The AP has said that the suit is not an attack on all aggregation blogs. Here's the organization's beef with Meltwater: [it's] most notably... a closed system sold only to subscribers for a fee, and not a means of expanding public access.

The AP filed a similar suit in 2009 and won. The organization defeated All Headline News, which had repurposed AP content for subscribers, according to an Ars Technica report.

In a more publicized lawsuit, the AP sued street artist Shepard Fairey over who owned the rights to the Hope poster president Barack Obama supporters used during the campaign.

In an out-of-court settlement, Fairey and the AP agreed to work together going forward with the Hope image and share the rights to make the posters and merchandise bearing the Hope image and to collaborate on a series of images that Fairey will create based on AP photographs.