The Authors Guild -- which represents a measly 8000 writers -- brought a class action against Google on behalf of all literary copyright holders, even the authors of the millions of "orphan works" whose rightsholders can't be located. Once that class was certified, whatever deal Google struck with the class became binding on every work of literature ever produced. The odds are that this feat won't ever be repeated, which means that Google is the only company in the world that will have a clean, legal way of offering all these books in search results.
The Authors Guild and the American Association of Publishers (who took part in the settlement) totally missed the real risk of Google Book Search: they were worried about some notional income from advertising that they might miss out on. But the real risk is that Google could end up as the sole source of ultimate power in book discovery, distribution and sales. As the only legal place where all books can be searched, Google gets enormous market power: the structure of their search algorithm can make bestsellers or banish books to obscurity. The leverage they attain over publishing and authors through this settlement is incalculable.
I like Google. I worry about the privacy implications of some of their technology, and I wish they had more spine when it came to censoring search results in China, but I think they make incredibly awesome search tools and every person I know who works at Google is a class-A mensch and a certified smart person (a rare combination).
But no one, not Google, not Santa Claus, should have this kind of leverage over the entire world of literature. It's abominable. No one benefits when markets consolidate into a single monopoly gatekeeper -- not even the gatekeeper, who is apt to lose its edge without competition to keep it sharp.
The publishers I spoke to about this were incredibly smug about it. Because the settlement gives them the power to keep new releases out of Google, they feel like they can use this to keep the company honest.
This is wrong.
New releases are the majority of the publishers' business, but they're not the majority of the market for books -- and they're only successful because of all the context created by the entire history of literature. If the publishers offer a sweetheart deal on searching new results to Yahoo, but can't give Yahoo access to the orphan works and other catalog items to which Google alone has easy legal access, Yahoo's search tool will never compete with Google's. To understand why, imagine if Yahoo tried to compete with Google by offering a search engine that only indexed the last 30 days' worth of web-pages: it's true that most of the stuff I read on the web was written in the past 30 days, but the 40-50% of stuff I that wasn't is often enormously important to me. In that world, I would have to flick constantly between searching Yahoo and Google to make sure I wasn't missing stuff -- and very quickly, I'd just default to Google.
By design or by accident, Google got the most reactionary elements in publishing to anoint Google the Eternal God-Emperor of Literature. Thanks a lot, Authors Guild -- with friends like you, who needs piracy?
The proposed settlement agreement would give Google a monopoly on the largest digital library of books in the world. It and BRR, which will also be a monopoly, will have considerable freedom to set prices and terms and conditions for Book Search's commercial services. BRR is unlikely to complain that the price is too high, the digital rights management technology is too restrictive, or the terms are too onerous.Legally Speaking: The Dead Souls of the Google Booksearch Settlement
Google will also be the only service lawfully able to sell orphan books and monetize them through subscriptions. BRR will get 63 per cent of these revenues which it will pay out to authors and publishers registered with it, even as to books in which they hold no rights. (Some unclaimed orphan book funds may go to charities that promote literacy.) No author whose books are in the corpus can get paid by the BRR unless he/she has registered with it.
Virtually the only way that Amazon.com, Microsoft, Yahoo!, or the Open Content Alliance could get a comparably broad license as the settlement would give Google would be by starting its own project to scan books. The scanner might then be sued for copyright infringement, as Google was. It would be very costly and very risky to litigate a fair use claim to final judgment given how high copyright damages can be (up to $150,000 per infringed work). Chances are also slim that the plaintiffs in such a lawsuit would be willing or able to settle on equivalent or even similar terms.