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Google Settles Book Search Lawsuits with Authors, Publishers

Posted by: Rob Hof on October 28, 2008

UPDATED with more detail throughout…

After three years of wrangling, Google has settled two lawsuits from publishers and authors that claimed its book search program violated their copyrights. Under the agreement, assuming it’s approved by a New York District Court, Google will pay $125 million to settle the suit, which pitted Google’s claim that it had a right to digitize books, present excerpts, and share digital copies with libraries against authors’ and publishers’ claims that those activities violated their copyrights. (Disclosure: One of the five members of the Association of American Publishers that sued Google was McGraw-Hill, owner of BusinessWeek.)

Google will be able to continue scanning millions of books that are in copyright but out of print. The deal doesn’t cover books currently in print; Google does scan those but doesn’t allow views of more than snippets unless publishers have agreed to that. Google, which has scanned 7 million books already and anticipates there are 20 million or more additional books it could scan, will be able to show not only snippets, but full pages. There’s more detail on this Google blog post.

In return, Google will allow people to buy the books, offer subscriptions to institutions such as universities and libraries, which will allow people to print an unlimited number of pages from a book for a fee, and give authors and publishers control over who gets access to their works and how. Google will take 37% of the revenue from sales and subscriptions, with authors and publishers sharing the rest after administrative costs. Google also will share the same proportion of revenue from advertising placed on Google Book Search results pages, and from sales of digital books or portions of them.

The $125 million will go toward resolving claims by authors and publishers, paying for legal fees, and setting up a Book Rights Registry that will locate rights holders and distribute payments to them, maintain a database of books, and determine which publishers and authors want to allow their works online or not.

Clearly, Google must have felt it was not worth continuing to fight the lawsuit, which exposed what appeared to be gray areas of copyright law in the digital age. Indeed, the settlement doesn’t resolve whether copyright law allows Google to scan books without authorization. “We had a major disagreement with Google over copyright law and we probably always will,” Paul Aiken, executive director of the Authors Guild, said on a conference call.

The settlement, which is effective only in the U.S.—people elsewhere will only be able to view snippets of book text as they can now—is in some ways a win for publishers and authors. They will get new revenue streams for books that in most cases didn’t have a market anyway because they were out of print. However, Google also ended up paying what was relative chicken feed for the right to continue providing access to these books, and it will get what seems like a sizable chunk of revenues from subscriptions and ad revenues. The only question is why it took well over two years for the two sides to come to an agreement that appears to work well for both of them, as well as for readers.

Update: I asked Google and representatives of the publishers and authors that very question in a followup call. Their answer: Four different parties with different agendas—authors, publishers, libraries, and Google—all had to agree, and that involved a tremendous amount of detail, as you can see in the agreement here.

As a book lover, what I find the coolest thing about the deal is that eventually, I’ll be able to visit most any library and, using at least one terminal that will be set up at each library, view digital versions of these books for free (though I’ll have to pay to print out pages). It’s nice that all the sides managed to agree on something that is demonstrably a good thing for all of us.

Reader Comments

Mark Regan

October 28, 2008 3:25 PM

Finally, common sense prevails. Who better to rely upon to work out a settlement than Google and the publishers and authors, instead of letting the decisions be made by Congress and Judges, who know nothing about creative works or marketing.

George Riddick

October 29, 2008 7:46 PM

EXPOSED - the fallacies of Google's universal search

Bravo! Congratulations authors and book publishers. I applaud you for holding your ground.

Ten (10) years ago this week, President Bill Clinton signed the revolutionary Digital Millennium Copyright Act (DMCA) into law. Since then, everything in the copyright and technology industries in this country has changed ... and not all for the better, as you might have expected. You see, in their rush to bring our laws into sync with the international community, Congress failed to write a succinct and non-ambiguous bill ... and we need a succinct and non-ambiguous bill very badly. Believe me, I know. My small graphic arts development company, Imageline, was in the middle of a $60 million federal lawsuit regarding copyright infringement at the exact same time.

The creative copyright defense lawyers in this country have all made their fortune over the past decade, defending and confusing people based on these DMCA ambiguities in copyright law. Maybe that was the Congressional plan all along. After all, most of the folks up in Washington are lawyers and judges themselves, now, also, aren't they?

Well, the rocket scientists, investment bankers, copyright lawyers, and software engineers in Redmond and Mountain View are a hell of lot smarter than the politicians ... and way more devious. We learned that lesson the hard way, as well.

You see, web-based search, aka Adwords, was just about to start its meteoric rise to top of the world in the late 1990s. And the Google engineers were the only folks who had a clue how to make all of this work. Google began to dominate web-based search, went public, and set out on the path to organize and conquer the world.

I love web-based word search and even maintained an open mind as to the value proposition it creates for our economy as a whole. Plus, it was fun in the late 90's to see several U.S.-based companies still dominant on the global stage and spreading their technologies rapidly around the world. Perhaps for the first time, the gigantic digital divide we have in this world, would start to narrow? Pretty naive thinking now that I think about it.

But Google, and the companies that learned not to innovate, but to simply mimic the folks in Mountain View at every turn, apparently had another plan. They would expand "search" to images, video, published books, medical records, private homes, x-rays, and everything else on the planet ... and in outer space, for that matter. And now that they were so popular and successful, they wouldn't even bother to ask the disorganized and clueless creative people who own all of the copyrights for permission. Google set out to continue its Internet search and advertising dominance into image search, video search, book search, medical search, and other universal searches, including every other aspect of our lives, both public and private.

And no one had the guts to even question the Googlites, let alone try to stop them. All Microsoft, Yahoo, AOL, and could do was either beg Google to work with them or put teams of engineers in place to try and replicate the various Google search platforms almost identically. In other words, if stealing from people, promoting illegal products and services, and walking off the cliff, was good enough for mighty Google, then doing all of these things and walking off the cliff was fine with all the rest of them, as well. Really pretty disgusting for what had previously been viewed as an innovative proud industry, with good business practices and ethics, don't you think?

And then Baidu (China), Yandex (Russia), Daum (Korea), Lycos (Europe), Rediif (India), and other international search engine companies decided they wanted a piece of the action, as well. Image search, and practically everything else search, would become a common tool throughout the Internet world. After all, images are the world's common denominator, aren't they? Copyright holders be damned.

In the early days, most copyright holders caved. They were afraid of Google and new technologies they did not understand. Federal judges, who didn't really have a clue what was going on, allowed Google's massive army of lawyers to convince them that the DMCA, which was originalyl designed to protect copyright owners, was actually intended by Congress to provide a safe haven for technology companies who wanted to infringe, and to do anything they pleased with other people's property. Even if they made billions of dollars by doing so, they could still claim that their pirate ships could sail smoothly over the rough cyberseas and then pull safely into safe harbors authorized by the DMCA. NONSENSE! This has been, and continues to be, one of the grandest corporate scams and get rich quick scandals this country has ever witnessed.

Unfortunately, the technology scams gained even more traction, and more life, once the financial industry scandals up on Wall Street, and in the mortgage lending industries, started to surface and take center stage.

So, here we are today. Three major good news events for copyright owners have just recently occurred. Could it mean the end of Google's dominant evil ways? I sure hope so. And so do millions and millions of people who create our jobs and produce the vast majority of our copyrighted works in this country ... our small businesses and creative individuals ... our illustrators, designers, photographers, videographers, film producers, musicians, book publishers, cartoonists, journalists, graphic programmers, comic strip artists, poets, digitizers, and animators ... you get the picture. All of the people that the Google, Microsoft, and Yahoo engineers, lawyers, and finance people hide back in the corner on the 18th floor.

Here is the recent good news for small businesses and copyright owners:

1. This week's news that Google has to pay book publishers and authors $125 million dollars and cease its plan to digitize all books, whether the copyright owners wanted them to or not. Microsoft apparently has already abandoned its Google clone in this arena. Yahoo supports a more open industry plan.

2. Courts in Germany have followed the wisdom of courts in Belgium and France and ruled against "Google Image Search" procedures, in a huge ruling that will hopefully set the new precedent on the global stage. Google can no longer 'willfully infringe for profit' says the court.

3. Courts in China have actually ruled against its own search engine giant, Baidu, as well as Yahoo China, and found their "image search" features pointing consumers to obviously infringing web sites were, indeed, unlawful ... even in China who leads the world in piracy these days.

Courts in the United States have fallen behind the rest of the world in this area, and it is shameful, indeed, since the vast majority of the world's copyrighted works are still produced her in America. But the copyright enforcement pendulum has finally started to swing the other way ... towards the hard working people who deserve to have their copyrighted works protected by the government in the country they live in. How can anyone debate that argument with a straight face. Google executives and attorneys apparently don't know how to make a straight face, I'm afraid. They all appear to be crooked, or at least hypocritical, when it comes to protection of other people's copyrights. Isn't Google's now famous CEO an attorney as well?

So, "bravo" again to book publishers and authors ... you held your ground. You did us all proud. And all of the rest of us in the copyright industries are thrilled that you did so. THANK YOU!

Your publicly recognized settlement is a step in the right direction for all copyright holders in the U.S. from my point of view. And in other countries, as well. I, for one, believe the days of Google executives, investment bankers, software engineers, copyright lawyers, and rocket scientists making up their own self-serving rules of conduct and codes of ethics in this country are finally over. How there ever was a debate as to the legality of Google unilaterally deciding it could make illegal copies of any copyrighted material they chose to without the copyright owners permission is beyond me.

I say we have all had enough of this corporate greed, corruption, and scandal. How about you? In fact, I believe this is yet another symptom of the kind of crooked corporate society we have lived under here in the United States for the past 8-10 years. Enough is enough.

Don't you think it is quite a coincidence that during this exact same time period Google accumulated hundreds of billions of dollars, while never really inventing or creating much of anything new and original themselves?

Apparently, when you set your own rules and start to feel so powerful that you can ignore the laws of the land, this is what happens, folks. Ask George Bush and Dick Chaney. It's that pure and simple. How many Wall Street bailouts will we need to see before the rest of us open up our eyes?

Book search is just tip of the iceberg where the exposure of the true Google is concerned.. From what I can tell, 'image search' is emerging as perhaps the final Waterloo for mighty Google. Why? Because Google infringes more copyrighted visual material through its image and video search operations than virtually all other technology industry players combined. Hundreds of millions of copyright violations each and every month. An no one has thus far had the guts to stop them. No competitor ... no government agencies ... no judges ... no judiciary committees ... no Congressional hearings ... no copyright industry boycotts ... no nothing! Except perhaps for Viacom, who filed a billion dollar a lawsuit against YouTube/Google well over a year ago.

But an image and/or video search engine class action lawsuit, and one that is easily 5-10 times larger than the book search suit that just settled out of court, is imminent. I know of about a dozen companies, mine included, who are busy gathering documented evidence to bring on such a suit. Hopefully, before Google wipes out half of the legitimate copyright owners in this country as it tries to do to digital photographers, illustrators, designers, digitizers, graphic programmers, and animators what it tried to do to authors and book publishers, as well.

"We have the right to copy and organize all of your digital images whether you want us to or not", says Google either directly or through inference.

Wait a second. My little company, Imageline, invented the software category of digital graphic arts content back in in early 1980s when the Google founders were still in diapers. We do not want Google to organize our proprietary copyrighted images. They are already organized. And we don't want Google making copies of our digital artwork, either. That's a direct violation of the copyright laws in this country, and the rules under which we agreed to develop and produce these works in the first place long ago. All of our copyrighted works have been registered with the U.S. Copyright Office in the exact way we were directed by Copyright Office officials.

Keep your corrupt hands off of our images, Google. Go play with your own photos, maps, or whatever it is that you produce and actually own.

In my view, the entire copyright industry, and the populous, in general, has become sick and tired of the arrogance, hypocrisy, and greed of Google. In spite of their "do no evil" mantra, Google has actually grown to compete with Microsoft for the title of the 'Supreme Evil Empire', in my opinion.

I, for one, am sick and tired of Google teaching my children that stealing is okay in the new digital age. No, it's not, Google! You are misguided and no one wants you to use the money provided by public shareholders to copy other people's copyrighted works, buy more757s, park them in your own back yards, explore outer space, give each other massages, or organize the world's information anymore, regardless of what your rocket scientists have to say.

The book publishers' victory is just the tip of one of the most toxic icebergs this country has ever seen. Wait and see.

Thanks for listening.

George Riddick
Imageline, Inc.

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Bloomberg Businessweek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, and Douglas MacMillan, dig behind the headlines to analyze what’s really happening throughout the world of technology. Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.



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