News aggregators vs. content creators. When does linking and excerpting news stories by third parties cross the line?

It was the topic discussed in detail Wednesday during a session at Bloomberg BusinessWeek’s annual Media Summit in New York. As Barbara Wall, Gannett Co.’s senior associate general counsel, put it: “There is an array of impacts from aggregating stories, but I’m not sure anyone has an answer on how exactly it’s affecting our business.”

Aggregators—whether online or through e-newsletters, etc.—collect editorial produced by content creators and often sell ads around the aggregation “service.” While not technically doing any original reporting, aggregators claim they help drive traffic to the content creators’ Web sites.

But not always without legal consequences. In 2008, New York Times Co.-owned launched a hyper-local site that featured links to news stories aggregated from other news organizations. That same month, the parent company was sued by fellow publisher GateHouse Media which alleged copyright infringement based on the site’s use of GateHouse’s headlines and leads.

Session panelist Richard Samson, who serves as senior counsel for the New York Times, told attendees that the eventual solution was that GateHouse used technology to block’s automated aggregator from accessing their content while agreed not to circumvent that technology. “We thought it was a win-win for GateHouse to have so much traffic from a large news site, but that was not so,” Samson said. “It’s a complex issue. We have to figure out where to draw the line.”

One question considered during the session was whether aggregators are actually driving any significant traffic to publishers’ Web sites. Do users of sites like Google News actually click through to a publisher’s site when they could potentially get all the information they want/ need from the headline and excerpt?

“I think it depends on what the news is, but if written right, the headline and lead sentence should be a potent summary of the story,” said Wall. She said it’s “dangerous” for content creators when aggregators use both because users, especially those on mobile devices, never actually click through.

Web sites like the Huffington Post have made serious money linking to and excerpting from publishers’ Web sites. I can think of at least one well-known media news aggregator who not only pulls publishers’ headlines and leads for his e-newsletters but posts full news stories, verbatim—and sells ads against them. Sure, he links back to the original story, but who is going to click back to the publisher’s Web site when they can read the whole piece directly from the newsletter?

In an age when publishers are struggling mightily to make nickels from their online endeavors, shouldn’t this aggregator offer some sort of revenue sharing program?

UPDATE: Anonymous blogger Dead Tree Edition wrote a follow-up to this post. Read it here.