You're describing a classic prisoner's dilemma.
That is, it's in the interest of the news industry as a whole to not list their content for free, but if individual news companies do that, they will lose out relative to the alternative, so every individual news company is trapped in a situation they don't prefer.
Google set this prisoner's dilemma to their advantage, using their position as a monopoly power to create it. It's reasonable, then, for the EU and the news industry to seek to remove Google's monopoly advantages.