Justice Department looking into Google Book settlement

The U.S. Justice Department has started to make antitrust inquiries into Google's settlement with authors and publishers over the Internet giant's ambitious project to scan books and put them online.

Some authors and Google critics have complained that the deal, agreed upon last year and pending a judge's approval, would hurt competition by giving the company a stranglehold over the burgeoning market for online books.

The Justice Department has met with Google at least once in the last several weeks about the settlement, and more talks are scheduled for the near future, according to a person familiar with the matter, adding that Google has not been notified that a formal investigation has been launched.

Inquiries by law enforcement officials do not necessarily lead to formal investigations, nor even to a public objection by the agency.

The Justice Department also contacted Consumer Watchdog after the Santa Monica advocacy group sent it a letter expressing concerns about the deal.

"They talked to us with what I thought was great interest," said John Simpson, an advocate with Consumer Watchdog who participated in an hourlong discussion with Justice Department attorneys.

Google declined to comment, and a Justice Department spokesman was not immediately available.

In other developments in the case today, U.S. District Judge Denny Chin extended, from May 5 to Sept. 4, the deadline for authors to opt out of the Google Book settlement. Chin had been ...

... petitioned by a New York law firm representing several authors, including the estate of John Steinbeck, and by professors at the UC Berkeley School of Law to extend the deadline to give authors more time to absorb the 134-page settlement, a document whose complexity was not lost on those who read it.

"I'm a lawyer, and I found the settlement agreement to be a pretty tough go," said Pamela Samuelson, a professor who wrote the petition on behalf of her colleagues.

"The settlement is really detailed," Google spokesman Gabriel Stricker said.  "We want to make sure that rights holders everywhere have enough time to think about it and make sure it's right for them."

The case began in 2005, when the Authors Guild and the American Assn. of Publishers filed separate lawsuits against Google, alleging that the search company's violated copyright laws. Google scanned books and stored them on its computer servers so Web surfers could search through and read them on a browser. For copyrighted titles, Google Book Search allows readers to flip through only a few pages, whereas works in the public domain are often available in their entirety.

The three parties settled the suits in October 2008 with an agreement that would allow Google to scan the copyrighted books and eventually sell the digitized contents to consumers, either as individual books or through all-you-can-read subscriptions. Google would keep 37% of the revenue, while authors and publishers who had joined the settlement would split the other 63%.

As of November 2008, Google had scanned 7 million books. Of those, 4 million are so-called "orphan" works whose copyrights have not yet expired but whose authors could not be located by the company.  Advocates are concerned that the settlement would give Google a monopoly over the rights to a vast collection of orphaned works.

The strength of that market position would be enhanced, critics say, by the apparent legal immunity the settlement grants the company from future claims by the owners of orphaned books. Competitors would not have such protection.

-- Alex Pham and David Sarno

Comments

[George Snyder]

All authors and publishers, both American and foreign, should recognize the insanity of the proposed Google book copyright settlement in which Google is trying to monopolize what should be the job of the US Copyright Office (on the account of the US copyright law’s all-encompassing claims of jurisdiction over almost any book of any national origin).

If Google proposes to take care of all patent registrations in the world and decide on how much each patent holder should be paid while taking nearly 40% cut on each instance of the patent use, every government and patent holder in the world would be up in arms denouncing the idea; but the proposed Google settlement intends to do exactly that, except that it deals with copyrighted books, instead of patents.

The settlement essentially kills any future prospect for developing open Internet electronic publication market in which authors, publishers, and distributors negotiate freely for the best deal that can be struck under the prevailing market condition guided by the invisible hand of the market force. Google book settlement, on the other hand, put all that under the huge visible hand of Google guiding the market development under the legally binding force sanctioned by the US government.

Just because Google went ahead and scanned over 7 millions books on its own initiative with its own money is irrelevant, and it does not give Google the exclusive right to negotiate with all the authors and publishers in the world and force them to accept a paltry, fixed sum of money in exchange for all sorts of complex, self-serving restrictions and obligations designed to further Google’s dominance in the online information distribution market in the future to come.

There is a better way to put orphan books back in circulation that would benefit the general public much more without the public being forced by the US government to put money into the coffers of a profit hungry company. After all, Google settlement does not compensate the authors of orphan books; so why should Google, and Google alone, be given the opportunity to profit from them?

Google’s concerns for orphan books and their mostly dead authors are heartwarming, but it does not require Google’s help to put them back in circulation. Instead, a universal online copyright registry hosted by the US Copyright Office can be established to identify orphan books. After they are identified as such and the US Congress passes the necessary legislation to strip the copyright protection for orphan books (only for online cost-free distribution), free eBook hubs like Project Gutenberg and the Internet Archive can distribute the books. (For more information, see: http://asolutiontoorphanbooks.blogspot.com/ )

Once the orphan book issue is out of the way, the main attraction of the Google settlement to authors and publishers would be that Google would be the one-stop online clearing-house for the distribution of eBooks, as well as for the collection and disbursement of proceeds. Obviously many authors and publishers are willing to forsake potentially more lucrative deals that can be realized once online eBook distribution market develops more fully. But this is shortsighted and frankly stupid, indicative of the lack of visions and talent among the publishing industry executives in replicating on the Web the open, “invisible hand” market that already exists for printed books.

If the key players in publishing industry want to shape their own future, they must not allow outsider like Google to define their future. Hopefully, they will recognize that there are plenty of things that they can do online without the involvement of Google and walk away from the settlement with Google, which is nothing but an attempt by Google to highjack the future of publishing industry and remake it to suit Google’s own convenience and profit.

[mark k. white]

hi i like to say that first of all it is not the responsibility of google to be responsible for the ill mannered way that a person legally falls into a binding contract and to submitt illegal sceams against the government. that any well educated persons is responsible for . period! and shall not hold google responsible. for prosecuting