Veteran tech blogger Lauren Weinstein describes this risk well in a recent blog post, in which he calls what the government of France is doing “extortion,” and warns of the long-term risk of Google acceding to such demands that it pay for the simple act of linking and excerpting content:

“There is little evidence to suggest that ‘paying off’ a party making unreasonable demands will do much more than quiet them for the moment, and they’ll almost inevitably be back for more. And more. And more. Even worse, caving in such situations signals other parties that you may be susceptible to their making the same (or even more outrageous) demands, and this mindset can easily spread from attacking deep-pocketed firms to decimating much smaller companies, organizations, or even individuals.”

As my colleague Jeff Roberts noted in his post on the Google settlement, the French originally wanted the company to pay as much as $100 million, and wanted almost all of that to go into a fund that publishers could use for their own purposes, rather than into ad buying or other joint ventures. And he also noted that with the latest deal — which comes on the heels of a similar settlement with Belgium — Google is sending a very obvious message to other countries such as Germany that it is prepared to pay.

Google’s tactics set a dangerous precedent

This may make sense for Google, since it is trying to avoid as much litigation as possible, and wants to be on good terms with European countries (where it has already run into multiple roadblocks and barriers around services like Street View and privacy concerns). But I think Weinstein is right when he argues that this is only going to encourage countries like Germany — and plenty of others as well — to assume that if they push Google on the subject of linking, they will get cash.

Google wants these payments to be seen as a helping hand to publishers, which is why the fund is described as “supporting digital publishing initiatives,” and why it puts so much emphasis on the strategic partnership angle. But regardless of the picture it is trying to paint, the settlement is being described by many as a “pay for links” deal, and that perception is dangerous. As Weinstein puts it:

“France’s complaints regarding Google related to activities that are absolutely part and parcel of the fundamental and fully expected nature of the open Internet when dealing with publicly accessible Web sites [and its] success at obtaining financial and other concessions from Google associated with ordinary search and linking activities sends a loud, clear, and potentially disastrous message around the planet, a message that could doom the open Internet and Web that we’ve worked so long and hard to create.”

In other words, this issue is much bigger than just Google. While it may serve Google’s purposes to settle with France and Belgium, and perhaps other countries as well, all that does is encourage other governments and companies to see payment for links as an appropriate strategy. How long until U.S. newspapers and publishers start to argue the same thing? What about other companies? Director Harvey Weinstein (no relation to Lauren) said in a recent interview that the U.S. should have legislation to make this a reality — and Google is helping that kind of thinking gain momentum.

It’s cruelly ironic that the company spent so long arguing (correctly) that excerpts of books were fair use in its long-running legal battle with book publishers and authors — a battle in which at least one court has agreed with the company — and now here it is paying newspaper publishers for what is fundamentally the same practice. It’s a short-sighted appeasement strategy, and we could all be the worse for it.

Post and thumbnail images courtesy of Shutterstock / Alexander Santander and Flickr user Affiliate

U.S. District Court papers filed Friday revealed greater detail as to how Netflix settled a class-action privacy lawsuit filed against it last year, accusing it of violating the Video Privacy Protection Act (VPPA). In short, Netflix agreed not to hold onto data showing which movies its former customers rented for as long as it has in the past.

In February, Netflix announced that it had settled the case for $9 million in restitution and attorney’s fees, but didn’t talk about any changes to its policies. But as a plaintiff’s motion filed Friday seeking preliminary approval of this settlement shows, Netflix agreed to strip out information about the titles its former customers rent from their basic identification profiles no more than one year after they leave the service.

The VPPA was signed into law in 1988 by then-President Ronald Reagan after a Washington, D.C. newspaper outed Supreme Court nominee Robert Bork’s Blockbuster rental history during his Congressional approval hearings.

As Friday’s plaintiff’s filing noted, a subsection of that law requires video operators to destroy rental-history data “as soon as practicable, but no later than one year from the date the information is no longer necessary for the purpose for which it was collected.”

The plaintiffs contend that, “Netflix’s ongoing maintenance of ‘digital dossiers’ on its subscribers — after canceling their subscriptions and beyond the point where Netflix still needs the information — constitutes a failure to ‘destroy as soon as practicable,’ in violation of the VPPA.”

Netflix declined further comment on the matter beyond its February SEC filing confirming the settlement.

Friday’s filing also revealed that, under terms of the agreement, Netflix will pay $6.75 million to various privacy organizations, while $2.25 million will go to the attorneys who filed the case.

The customers whose privacy rights were allegedly transgressed? They’ll receive nothing more than total consciousness on their deathbed.

Both sides wish for Judge Edward Davila to approve the settlement by June 29.