Newspapers to LexisNexis: Time to Pay Up – TheStreet.com

Six major U.S. newspaper companies have demanded that LexisNexis, a major aggregator and distributor of news content, stop business practices that the publishers have deemed inconsistent with contractual agreements and that allegedly infringe on their copyrights and damage the companies.

“We demand that you cease these practices immediately,” wrote Advance Publications Inc., BH Media Group, Cox Media Group Inc., McClatchy Co. (MNI) and Tronc Inc. (TRNC) in the demand letter to LexisNexis Group on July 17. (Philadelphia Media Network LLC, publisher of the Philadelphia Inquirer and Philadelphia Daily News, joined in the complaint after the initial letter was sent.)

At issue is LexisNexis’ provision of news content to media monitoring organizations, a sector of the business intelligence industry that may be as large as a $3 billion annual industry.

“When LexisNexis distributes our content to customers, such as for-profit, media intelligence firms, that would otherwise license that content directly from us, LexisNexis deprives our companies of essential licensing revenue that cannot be recaptured,” the newspaper companies wrote. “In appropriating our licensing operations for itself, LexisNexis unjustly enriches itself by monetizing content from publishers for which it has not paid. These actions may also constitute other violations of federal and state law.”

LexisNexis declined comment on the letter, but sources said the publishers can expect an initial reply within the week addressing the claims.  

Though the publishers themselves did not want to address the letter publicly, it’s clear, according to several industry sources, that the News Media Alliance, a newspaper industry trade group, coordinated the action. This move follows closely on NMA’s push to get Congress to give it “safe harbor” so it can collectively negotiate with digital industry behemoths Alphabet Inc. (GOOGL) and Facebook Inc. (FB) . As such, it represents an industrywide effort to legally assert intellectual property and copyright concerns about the wider use of newspaper company-originated content in the digital age.

LexisNexis is a big player in the industry, a major division of global giant RELX Group plc, long known as Reed-Elsevier, which encompasses legal, scientific-medical, risk and business analytics and events businesses. LexisNexis is the only company to so far receive the demand letter. More than 50 companies, though, have recently received an NMA-supported letter expressing similar legal and business concerns. It was such a query to LexisNexis — one that returned insufficient response, news company sources said — that preceded the July demand letter.

While the effort isn’t a new one — having been worked episodically for more than a decade, without much success — it marks the industry’s latest effort to find new revenue as print advertising revenue continue a deep decline and job eliminations, though little announced, continue to pervade the industry.

The demands themselves may seem arcane to those not versed in the sometimes darker arts of “scraping” news content and in the burgeoning business of “current awareness.”

Media monitoring is as old as print. Until early this century, highly experienced copy clippers (and yes, wearing green eyeshades, as I witnessed in 2001) painstakingly took their scissors to physical (!) newspapers and magazines. They clipped brand and company mentions, assembled the clips into packets. The packets were then snail-mailed to public relations operations, internal and external to companies.

The internet, of course, changed that practice. Digital made keyword searching, electronic clipping and speed-of-light delivery of mentions to customers all possible. Further, media monitors now up their value propositions by offering product upgrades that build on data mining and business analytics lines.

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