Book Search Settlement THE ORIGINAL PROJECT The original

Book Search Settlement

THE ORIGINAL PROJECT The original Google Book Search project combined two related programs: 1) The Partner Project. 2) The Library Program.

PARTNER PROGRAM Books received from publishers Availability: depending on publisher’s decision

LIMITED PREVIEW Permits view of entire pages from the book, but not all the pages are available for view.

LIBRARY PROJECT Scanned from public libraries In-copyright books / orphan books Public domain books Snippets Browse full-text or download PDF

SNIPPET VIEW Each snippet contains only a few lines, and only three snippets could be shown per book

THE ORIGINAL PROJECT – CONT. • Google did not seek permission due to [proclaimed] enormous transaction costs. • Opt-out option: – Copyright owners could request Google not to include their works in the database. • Opt-in option – Partner Program: – By doing so copyright owners could share revenue with Google.

• Scanning involved copying which may infringe the copyright owner’s rights. • Google also converted files into searchable formats, using Optical Character Recognition (OCR) software. • In addition- Google made copies of each file for participating libraries. •

LEGAL LIABILITY – CONT. • Google could escape liability only if its copying is permitted under the fair-use doctrine.

PRECEDENT – KELLY V. ARRIBA SOFT • Arriba Soft, a commercial search engine, created a database of thumbnail images copied from the internet. – The thumbnails were displayed in response to specific search queries, and each thumbnail linked to the original website. • Kelly, a photographer, whose images were included in the database, sued for copyright infringement.

KELLY – CONT. • The trial and the appellate court both found Arriba Soft’s use to be fair: – Arriba used the work in a different manner, and therefore did not supplement the original work. – Search engines have an important social utility. – The search engine did not harm the sales of the images – on the contrary, it could help increase sales by directing viewers to Kelly’s website.

APPLYING KELLY TO GOOGLE? GOOOOO argued it had an even stronger case than Arriba: – The snippets show even less of the work than Arriba’s thumbnails. – An index to “all the books in the world” may be even more useful than a search engine. – Google allowed an opt-out option.

APPLYING KELLY TO GOOGLE? The authors and publishers on the other hand, argued that Google’s Book Project was very different from the Kelly case: – Kelly willingly placed his photo on his website, knowing it would be subject to search engines, yet he did not use “do not enter” software signs. – Google’s use harms the market for digital archives of books. – Google created a risk of wide-spread infringement by digitizing the books. – Kelly involved only one plaintiff. – Other Related Cases

So what does the goooogle Books Settlement include?

• Looking at the past – Google will be released from liability for its previous scanning and displaying of works, in exchange for one-time payment of about $125 million. • Looking forward – Google will be allowed to continue scanning and displaying books, in exchange for 63% of its net revenue from advertising.

• A Book Rights Registry (BRR) will be established. • An Institutional Subscription System will be adopted. • For orphan works this means that Google can go on with its copying while holding a share of the revenues “in trust” for “missing” rights holders. • Owners of copyrights in books created prior to January 5, 2009, may opt-out from the settlement or opt-in to other terms with Google. • Does not apply to periodicals. • Applies only to US and foreign owners of ”US copyright”.

Owners can opt-out from the settlement, or permit different uses (remove books, exclude users etc. ) The settlement needs to be approved by the court deciding the class action.

The BRR’s goal is to mediate between Google and copyright owners: • The BRR will take payments from Google and pass then on to the appropriate authors and publishers. • The BRR will deliver copyrights owner’s requests to Google regarding the level of access allowed to their books. BRR Copyright holder

• Will allow Google to sell digital access to entire catalog of scanned books to companies, colleges and potentially even individuals. • A Public Access Service will provide a very restricted version of the Institutional Subscription to colleges and public libraries- for free. • A Consumer Purchase System will allow Google to sell electronic access to the complete version of individual books. • The revenues will flow to copyright owners based on a 63/ 37 split.

• This program will allow researchers to run gigantic automated statistical studies on the entire body of scanned books. • For this use copyright holders will not be paid, under the assumption that the works are not used by people reading portions of the books.

• The libraries that have been supplying books through the Partner Program are not parties to the lawsuit. • However, the settlement includes a provision that enables them to sign an agreement with the BRR – effectively releasing them of liability.

• A Fully Participating Library (FPL) will provide Google with copyrighted books to scan into its database. • Libraries that receive from Google digital copies (LDC) of their books, must agree to keep them under secure and limited access conditions. • FPL’s must sign an agreement with BRR which releases them from liability of infringement on one hand, but also limits the library’s use of the digital copy on the other hand.

The settlement creates three “products” for US users Previews Consumer Purchase Institutional Subscription Availability of an individual book for each product depends on its status

Book Status Pre- Settlement Post- Settlement Public domain In copyright, not commercially available In copyright, commercially available 100% 3 snippets/ book 20%* 3 snippets/ book, Bibliographic and/or Partner information only Program

• Users can buy online access to the full text of a specific book. • Consumer can print 20 pages at once; cut/paste 4 pages at once; can make book annotations. Price: Either set by copyright holder, or Google will set price algorithmically between 1. 99$ at 29. 99$ (about 80% of books are priced below 10$).

• Institutions can purchase annual subscription to allow access to full texts. • Access will be limited to “appropriate individuals” within the institution. • User can: print 20 pages at once; cut/paste 4 pages at once; make book annotations; provide links to e-reserves or course management systems.

• Within 5 years, Google must provide previews, public access service and institutional subscriptions for 85% of the copyrighted in-print books it has scanned. • Google must make reasonable efforts to accommodate for users with print disabilities, including: screen enlargement, voice output and Braille displays. • Financial obligations: One time payment of at least 60$ to each book + revenue sharing - 63/37 split.

Advantages of the Books Settlement

• The BRR resolves the claims of all class members: publishers, authors and even absent members. • Financial advantage - Google makes substantial revenues from selling ads, subscriptions and e-books – while the publishers and authors get the lion’s share of these revenues.

The settlement has the potential of providing access to a digital library of millions of books • For most books users can see up to 20% for free (rather then just 3 snippets). • Users can also gain free access to full text through limited public access services. • Consumers can purchase access to specific books. • Universities, schools, companies and other institutions can subscribe to the full database of e-books. • Scholars can perform non-consumptive research. • Participating libraries receive digital copies of their books.

• Ad’s: Google promises not to use pop-up or pop-under advertisements, and the BRR will to take action against authors presenting their books with “animated, audio or video” ads. • Fair-Use rights: the Institutional Subscription terms will not “prohibit any use… that would otherwise be permitted under the Copyright Act” – this [seemingly] retains users’ fair use rights.

• By adopting the BRR mechanism, the settlement addresses one of the central problems, regarding clearing the rights to millions of books -transaction costs and uncertainty • Google can continue scanning books into its search index. • Google will not pay royalties on scanning or searching. The payment begins only once a user clicks on a page of a specific book. • Google still gains 37% of the revenue from the project, while avoiding liability for infringement.

Disadvantages of the Books Settlement

The BRR is a centralized entity, with substantial authorityto negotiate on behalf of owners, approve the security standards and has broad discretion to work out the revenue splitting formula between publishers and authors.

• The settlement recognizes this danger, and accordingly puts limits on the BRR: • Limits the BRR from representing subgroups of copyright holders. • Ensures licenses granted are non-exclusive. • Ensures opt-out options, even after several years. • However, The BRR is still an anticompetitive threat because of it’s class action binding effect.

• The settlement does not formally prevent anyone involved from doing deals with others - however the issue of transaction costs could de-facto prevent competitors from entering the market. • Furthermore, for 10 years the BRR can’t give anyone else better terms than Google gets (“most-favorednation” clause). Thus, Google would probably become the only one that can provide scanning and searching books services on such a scale.

• A no-price discrimination clause should be included in the settlement. • Reader privacy protection should be insured- the settlement currently does not include an explicit reader privacy guarantee. • Accountability and transparency should be further increased. • Purchasing subscriptions and other e-services could have a budget impact on institutions.

• Insufficient public access. • Such a comprehensive digital library is far too important to be trusted in the hands of private corporations – Is there a “public-failure” ? • Quality concerns: • Discretion to exclude – “holes” in books. • Research will decline – users will scan or preview rather than read. • Chilling effect on fair use (for both private users and libraries). • General change in the roll of libraries.

Thank You