http://www.nytimes.com/2009/11/14/technology/internet/14books.html?_r=1&hp
November 14, 2009
Terms of Digital Book Deal With Google Revised
By BRAD STONE and MIGUEL HELFT
SAN FRANCISCO — Google and groups representing book publishers and authors
filed a modified version of their controversial books settlement with a
federal court on Friday. The changes would pave the way for other
companies to license Google's vast digital collection of copyrighted
out-of-print books, and might resolve Google's conflicts with European
governments.
The settlement, for a 2005 lawsuit over Google's ambitious plan to
digitize books from major American libraries, outlined a plan to create a
comprehensive database of in-print and out-of-print works. But the
original agreement, primarily between Google, the Authors Guild and the
Association of American Publishers, drew much criticism.
The Justice Department and others said Google was potentially violating
copyright law, setting itself up to unfairly control access to electronic
versions of older books and depriving authors and their heirs of proper
compensation.
The revisions to the settlement primarily address the handling of
so-called orphan works, the millions of books whose rights holders are
unknown or cannot be found. The changes call for the appointment of an
independent fiduciary, or trustee, who will be solely responsible for
decisions regarding orphan works.
The trustee, with Congressional approval, can grant licenses to other
companies who also want to sell these books, and will oversee the pool of
unclaimed funds that they generate. If the money goes unclaimed for 10
years, according to the revised settlement, it will go to philanthropy and
to an effort to locate rights holders. In the original settlement,
unclaimed funds reverted to known rights holders after five years.
The changes also restrict the Google catalog to books published in the
United States, Britain, Australia or Canada. That move is intended to
resolve objections from the French and German governments, which
complained that the settlement did not abide by copyright law in those
countries.
The revised settlement could make it easier for other companies to compete
with Google in offering their own digitized versions of older library
books because it drops a provision that was widely interpreted as ensuring
that no other company could get a better deal with authors and publishers
than the one Google had struck.
"We're disappointed that we won't be able to provide access to as many
books from as many countries through the settlement as a result of our
modifications, but we look forward to continuing to work with
rightsholders from around the world to fulfill our longstanding mission of
increasing access to all the world's books," the engineering director for
Google Book Search, Dan Clancy, wrote in a blog post on the company's Web
site.
In the next week, Judge Denny Chin of the United States District Court for
the Southern District of New York is expected to set a date for a fairness
hearing, where arguments from both sides will be heard about whether or
not to approve the settlement.
The changes have not placated all opponents of the original settlement. In
a blog post on Friday night, the Open Book Alliance, a coalition whose
members include Yahoo, Microsoft and Amazon, referred to the changes as a
"sleight of hand" and said they did not address the "fundamental flaws"
addressed by critics.
"This settlement remains a set-piece designed to serve the private
commercial interests of Google and its partners," wrote Peter Brantley,
co-founder of the alliance.
But the parties are hoping they will placate the concerns raised by the
Justice Department, which in September asked a federal judge to reject the
original $125 million agreement. While the decision on whether to approve
the deal will be in the hands of Judge Chin, the Justice Department's
opinion is an important factor.
Gina Talamona, a spokeswoman for the Justice Department, said that the
department would review the filing, and that its investigation into
possible anticompetitive practices involving the rights to digital books
was continuing.
Google and its partners had hailed the original agreement, signed in
October 2008, as a public good. They said it would allow Google to create
an immense digital library that would expand access to millions of
out-of-print books, while creating new ways for authors and publishers to
profit from digital versions of their works.
Google's library would be searchable online, and users would have free
access to 20 percent of the text in each book. Google would also sell
subscriptions to the entire collection to universities and other
institutions. Every public library in the United States would be able to
offer its patrons free access to the full collection at one terminal.
Users would be able to buy access to full texts at home. Google, authors
and publishers would split all revenue generated through the system.
As part of the settlement, Google would pay to establish a Books Rights
Registry, to be run by representatives of authors and publishers, that
would administer payments.
But earlier this year, academics, legal scholars and some librarians
expressed concern that the settlement would grant Google a virtual
monopoly over orphan works, making it nearly impossible for anyone else to
build a comprehensive digital library. Some librarians feared that without
competition, Google would be free to raise prices arbitrarily.
Other critics said the agreement turned copyright law on its head by
granting Google the license to profit from works unless rights holders
objected. Some argued that orphan works authors and foreign authors were
not properly represented by the Authors Guild. The proposed settlement
prompted several hundred filings with the court, the vast majority
opposing all or parts of the deal.
In a Sept. 18 filling, the Justice Department echoed many of the concerns.
While saying that the settlement provided many benefits, it urged Judge
Chin to reject it, saying it raised antitrust, class-action and copyright
issues. But the Justice Department also encouraged the parties to work to
modify the agreement to salvage its benefits and overcome its problems.
The Justice Department filing prompted the parties to withdraw the
original agreement and revise it.
Copyright 2009 The New York Times Company
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