The Google Settlement: Where It Stands, and Our Opinion on the Appropriate Resolution
Google seeks to make
By Michael Stillman
The proposed settlement that would allow Google to offer digital copies of copyrighted books, and in particular so-called "orphan books," books that are out of print and their copyright holders hard to find, is moving ahead at a rapid pace, too rapid for some of the opponents. Google had reached a settlement with two groups representing authors and publishers, but the agreement also seeks to bind these missing copyright holders who have no say. A whole host of other parties has volunteered to speak on their behalf.
The settlement provides for an independent registry, funded by Google but managed by authors and publishers, to keep track of copyrighted books. Those available to Google would be sold with a 63%-37% split (copyright holder-Google) of revenues. Copyright holders may either put their names into the registry for their share of the royalties, or decline to participate, in which case Google will not sell access to their books. However, if neither claim nor refusal is filed (which will often be the case as many of these copyright holders could be authors dead for 60, 70, 80 years), Google will be able to sell access to the books without compensating the copyright holders.
Many parties have objected to this settlement, including competitors such as Amazon, Microsoft, Yahoo, and the nonprofit Internet Archive. Various publishing, library, and author groups can be found on each side of the issue, while Amazon book reader competitor Sony has sided with Google. Most of the opponents have banded together in an organization known as the Open Book Alliance. These groups sued in court to stop the settlement.
The case appeared to be coming close to a court ruling when the U.S. Government joined the opposition. This appeared to be a major victory for the objectors, but the government's objections may be much narrower than those of the other opponents. The government appears to want the settlement to be approved, but only after certain changes are made to allow for greater competition. The government wants other potential vendors of "orphan books" to have access to the same deal as Google, along with a few other changes. Once the government filed its objection, the court immediately put its plans for an October 6 decision on hold, and encouraged the parties to come up with a revised settlement that would resolve the differences.
Now, Google and its settlement partners have succeeded in getting the court to set the next hearing for November 9, where they will offer their revised settlement. Their hope is for a final court ruling in December or January. The Open Book Alliance reacted bitterly, claiming that Google and its settlement partners are pushing through a revision that may satisfy the government objections, but not their own (and for some of them, their hope may simply be to kill the settlement, not revise it). The OBA issued a statement saying that any settlement must be fully reviewed by all of their parties, not just the government. They continued, "It's also clear that the settlement partners have zero interest in creating an open process that takes input from critical stakeholders. Instead, Google and its partners are serving their private business interests and ignoring the public interest. They came to the courtroom without a single concrete recommendation of how they would address any of the problems with the original settlement. Instead, they proposed more of the same - secret, backroom negotiations - rather than an open, transparent and collaborative process."
We asked Google's Megan Lamb for Google's position on access by competitors to the books listed in the Registry. She responded, "The settlement is non-exclusive. The registry can do deals with any other company, including Google competitors, and as the testimony [of Google's Chief Legal Officer David Drummond before the House Judiciary Committee on September 10] says, 'If a competitor offers the registry a better deal, the registry has every incentive to take it.'" In other words, any competitor would be free to deal with the authors and publishers' registry, just as Google has. As for "orphan books," those for whom permission to republish is neither received nor denied, Ms. Lamb stated, "We have supported orphan works legislation for many years and continue to do so." She referred us to Mr. Drummond's testimony for more details on Google's position.
The Google Settlement: Where It Stands, and Our Opinion on the Appropriate Resolution
Google's Chief Legal Officer testifies before Congress.
In that testimony, Mr. Drummond notes, "We are the only company to date that has attempted to digitize the vast in-copyright collections of U.S. libraries. Even so, nothing in the settlement prevents anyone from doing what we have done. The agreement is non-exclusive in every possible respect, and the creation of the registry will make it easier for other companies to enter the market." As for the "orphan books," Drummond says, "To the extent that other providers want a legal framework to re-use orphaned books (without having to defend against a lawsuit like we did), Google would support a legislative solution."
While the debate has focused on competition and the rights of orphan copyright holders, we believe the key to this issue lies in a few other comments in Mr. Drummond's testimony. He notes, "Because the settlement largely deals with out-of-print books, it does little to change the state of competition for new, in-print titles, which comprise 97% of the market." The controversy involves only 3% of the book market, but actually, it is considerably less, since many copyright holders of out-of-print books will have claimed their rights. Presumably, this group would include a concentration of writers of more recently out-of-print books that would be under the greatest market demand. Beyond the "orphans" (right holders cannot be located), Drummond points to an equally difficult group - "neglected books" (copyright holder cannot be determined). He states, "The cost of ascertaining for certain who has the rights to an out-of-print book likely exceeds the economic potential of any given book. The result is that these books, which collectively represent much of our nation's printed cultural heritage, have remained inaccessible."
That is the point. This is much ado about very little financially, but a whole lot culturally and historically. We are arguing about books that were never going to make money for their authors or publishers again, but are filled with information of incalculable value for researchers and others. Why are we fighting over this? The opposition believes there are great principles involved, including free competition and the sanctity of copyrights. Google suspects that some of the opponents may be more concerned that Google's successful entry into the small out-of-print market could lead to their entering the more lucrative in-print market. Whatever the motivation, we believe this issue should be settled on the basis of public policy, and finding a way to make more information available in this digital age is good public policy. Here is our suggestion.
Since what is involved is copyright law, that is, government legislation, it should be resolved with the same, not private deals. For the moment, it is being handled privately because Congress has not acted, but it is Congress' responsibility to act. Old rules do not work well in new times. The legislation should support the independent registry with copyright holders having the right to participate or opt out. As for "orphaned" works, where no claim of ownership is made, they should be treated as in the public domain, with the caveat that rights holders retain the ability to make a claim for their share of future royalties at a later date. As long as no claim is made, Google or anyone else should be free to sell or give away digital or printed copies as if there was no copyright or the copyright had expired. Not just snippets, as Google now offers for these works, but complete copies, as research will be stymied if a book must be purchased before one can even see whether it contains useful information.
Now, some may object that this abuses the copyright holders' rights, but here we need to look at the purpose of copyright law. It was not adopted to protect some high principle of authors' rights, to be preserved even if the authors themselves no longer care. It was adopted to encourage the writing of books. We protect authors' financial interests through copyrights because if we don't, authors will no longer write books. However, protecting abandoned claims provides no incentive to write. No one is going to refuse to write a book on the grounds that while it will be protected for the full term of the copyright if they so desire, it will not be protected if they, or their heirs, stop seeking that protection. Their copyright remains in force as long as they wish. This fully protects the incentive to write books while freeing up works to public access once the copyright becomes a barrier to read, rather than an incentive to write. Indeed, we suspect that many of these authors, some long dead, would rather see their handiwork made accessible to the public once its financial value is gone, rather than be "lost" through pointless enforcement of technical rights. It better respects their work, and their memory, while opening reams of information to the public. Once such legislation is passed, access to "orphan books," so valuable intellectually, but not financially, will no longer be hostage to what we believe are bigger issues opponents may have with Google. Google, and anyone else who so desires, will be free to offer orphan books to the public. This is good public policy.