News & Trends: Countdown to the Google Book Search Settlement Review

The settlement also created the Book Rights Registry, through which “Google will pay rights holders 63 percent of all revenues from these [above] uses.” Google has to pay $34.5 million to establish the registry and cover notice and settlement administration costs. It also will pay “at least $45 million for cash payments to rights holders of books and inserts that Google scans prior to the deadline for opting out of the settlement.”

Big Questions
Most do not question the benefit of enabling millions of book titles to be searchable on the Web. This type of consumer access can only be positive.

At the heart of many criticisms are legal principles: fair use and antitrust issues. Giving Google permission to copy, use and profit from copyrighted material without prior permission from the rights holders opens the door for others to do the same. On the flip side, awarding a financial settlement to authors and publishers opens the door for publishers and authors to sue other search engines.

The antitrust concerns arise from the fact that this class-action suit binds authors and publishers into a “collective license.” According to James Grimmelmann, associate professor at New York Law School, where he is affiliated with the Institute for Information Law and Policy, this is essentially price-fixing.

“The settlement is by and large a good thing, since it will help people … get access to [books] on fair terms that compensate authors. But there are worrisome gaps in it,” says Grimmelmann. “It creates a powerful new registry that will have huge negotiating power to set the terms of the next generation of publishing and impose them on authors and publishers. And the structure of the settlement itself gives Google an initial lock on some very lucrative markets that will be hard for anyone else to dislodge.”