This case is less "Google News is not accessible to people in Spain" and more "Google News can no longer publish content originated in Spain." The effect may be similar because Spaniards often want Spanish content, but what's happening seems different to your characterization.
Well, they are not just removing all Spanish news sources from the Spanish Google news site, they are removing the Spanish Google news site, which seems pretty consistent with his characterization.
Spanish people can, of course, still visit any other country's Google News page, though. There is no reason to keep a single country's Google News page open if there are no news sources from that country.
It's similar to the Google China situation back in the day, except Spain won't block access to foreign versions of Google News.
Effectively, no Spanish-Spain news in Google news. I wonder if other Spanish-speaking versions of Google News will still link to major Spanish newspapers that are also popular in South America. I'd expect so. Many Spanish sources will actively try to get into Google News from other countries so they can bypass this levy and prevent the loss of traffic/relevance somewhat.
It's remarkable that someone today tries to insult Google by claiming they aren't creating content. EVERYONE knows this. People use Google because they are great at organization information, not making it.
There's a difference between Google Search and Google News.
It is already an achievement to write the headlines of the news and to rank the importance of a piece of news. I consider this and all the editorial also as content.
With Google Search, Google does the ranking etc. and provides a substantial own service on demand to a specific search. People always go to the original site if it fits their search request. All good here. But with Google News they just copy the headlines and parts of the articles. They present it, kind of republish it in opposite to creating a search service.
Personally, I'm a bit pissed by the Google, Microsoft, Facebook, etc. because of their sneaky busines concepts. So my post is hostile (which it shouldn't be, but happens ...), but not insulting towards Google.
I think in this case it's a blurred line. In the case of Youtube even more. True, they don't want to create their own content, but when they republish it and making money by doing so, we're in the middle of the copyright discussion. The question to answer in each of Googles (or others) businesses is, when is Google presenting it's own work (search results, etc.) or the work of others.
Google is generally useful to the sites they link to. Most sites want a high rank on Google, because that brings them more visitors and more advertiser revenue, and Google offers them that service at no cost.
If they don't want Google to link to them, they can control that through robots.txt.
You may remember a recent German law that allowed German news sites to charge money for this, and Google removed links to news sites that didn't want to be listed for free. Pretty soon, all sites allowed Google to link to them again, because the loss of traffic hurt them.
Basically this amounts to the question: should search engines and aggregators be allowed to exist at all? Should we go back to the pre search engine days when you could only find new sites when someone discussed it on usenet, or through web rings (a network of sites about a similar subject where each links to the next one)?
See, this is what I don't really get. Sure, they can make money by selling ads on the content they're indexing (which is the primary reason their ranking system has to stay egalitarian, or roughly so with a few exceptions), but publishers are by no means obligated to purchase display ads from Google, or to host using Google's platforms (Youtube, Blogger, etc). Imho, it's only a blurred line iff a publisher chooses to make it so.
So, what are you insinuating exactly? That Google should stay away from providing any sort of news completely unless they are willing to build a team of journalists? What's wrong with aggregation?