Microsoft's Copyright Assault on Google

Hoping to convince publishers to back its own online book search service, the software titan comes out swinging against the search giant

by Catherine Holahan

Microsoft threw a one-two public relations punch against Google on Mar. 6. The sparring got under way when Microsoft (MSFT) attorney Thomas Rubin publicly criticized Google's (GOOG) position on copyright—first in a newspaper editorial and then later the same day at a publishing industry conference.

The software giant's complaint? Google, in the name of organizing the world's information, is trampling on the rights of content owners. It's true that Google's attitude toward copyright hasn't won it many friends among established media companies. Last month, MTV-owner Viacom (VIA) called out Google for failing to provide better copyright filtering tools on its video-sharing site YouTube, among other things (see BusinessWeek.com, 2/2/07, "Viacom's High-Stakes Duel with Google"). Similarly, several book publishers, including BusinessWeek parent McGraw-Hill (MHP), Penguin, and Viacom's Simon & Schuster, have sued Google over its initiative to make books searchable by digitally scanning major library collections (see BusinessWeek.com, 4/24/06, "Ganging Up on Google").

In an address given at the Association of American Publishers annual meeting, Rubin accused Google of turning its back on publishing partners and "concocting" an interpretation of copyright law that allows it to violate content owners' rights. "In my view, Google has chosen the wrong path for the longer term because it systematically violates copyright and deprives authors and publishers of an important avenue for monetizing their works. In doing so, it undermines critical incentives to create," Rubin said.

Fighting Back

Google's response was to reaffirm its commitment to complying with copyright laws and reiterating what it considers benefits of its services. "The goal of search engines, and of products like Google Book Search and YouTube, is to help users find information from content producers of every size," wrote David Drummond, Google's chief legal officer, in a statement. "We do this by complying with international copyright laws, and the result has been more exposure and in many cases more revenue for authors, publishers, and producers of content."

But Google's executives must have been wondering what they had done to provoke Microsoft's public ire. After all, what does Microsoft gain by picking fights? An obvious, albeit small, benefit is raising awareness of Microsoft's competing book search product. Until Rubin's article in the Financial Times, there was little buzz about Microsoft's Live Search Books, which was launched for testing in December. Google Book Search, on the other hand, has been oft discussed and debated since its launch in 2004. Google does not yet have market share figures, but it notes that it has scanned well over a million books.

Seeking Differentiation

Arriving to market two years after a major competitor is typically a disadvantage for a company, unless its offering considerably improves on the existing product. Clearly, Microsoft believes striking partnerships with publishers could give its product that extra boost. In his speech, Rubin encouraged publishers to work with Microsoft instead of alternatives. "Microsoft is committed to making these decisions responsibly, respectfully, and with the goal of sustaining both artistic creativity and widespread access by consumers to online content. We want to join with all of you in urging other providers of Internet search and online content hosting services to do the same," said Rubin.