What's at Stake in the Google Book Search Settlement?
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What’s at Stake in the Google
Book Search Settlement?
Paul N. Courant
I
n 2004, Google embarked on a project to rightsholders) access to millions of copy- In my opinion, approval of the original
of historic scope. Its aim was to scan righted works, something not contemplated in settlement would have been vastly preferable
and index the contents of the world’s Google’s original scanning project. The settle- to its rejection, because it provided extraor-
great research libraries. One small prob- ment engendered many howls of protest and dinary and valuable benefits to readers and
lem: authors and publishers of works in some expressions of support. Pamela Samuel- scholars. But, in at least one important fea-
copyright sued, arguing that Google violated son, among the most eloquent of the objectors, ture, I believe that the Department of Justice
copyright law by scanning works without the called the proposed settlement “audacious” may be pointing the way to a settlement that
explicit permission of rightsholders. In the way and argued that it is “designed to give [Google] would be better than the original. Before I
of most commercial lawsuits, the parties set- a compulsory license to all books in copyright come to these conclusions, some background
tled, but unlike most commercial lawsuits, the throughout the world forever.” is required.
settlement greatly expanded the stakes, creat- In September, weeks before a scheduled
ing a great electronic bookstore where Google fairness hearing that could have led to ap- copyright and the google scanning project
would sell (with most of the revenue going proval of the settlement by the court, the court
asked the parties for an opportunity to revise
the settlement agreement in light of concerns
A rticle I, Section 8 of the United States
Constitution gives Congress the power
to “promote the progress of science and use-
Paul N. Courant is the Harold T. Shapiro Collegiate Professor
of Public Policy and the Arthur F. Thurnau Professor of raised by the U.S. Department of Justice and ful arts, by securing for limited times to au-
Economics and of Information at the University of Michigan. hundreds of other objectors. The court has thors and inventors the exclusive right to
He is also the University Librarian and Dean of Libraries,
and was Provost at Michigan when Google negotiated its given the parties a November deadline for a their respective writings and discoveries.”
original arrangement to digitize the University’s collections. revised agreement. The framers struck a classic balance in public
© The Berkeley Electronic Press The Economists’ Voice www.bepress.com/ev October 2009
--economics. They recognized simultaneously out-of-print works generally required visiting of copyrighted material can be severe—from
that the incentive to develop new knowledge a library that had a copy. As the digitization $750 to $150,000 (no, that’s not a typo; there
would be enhanced if writers and inventors project has proceeded (well over twelve mil- are four zeros after the fifteen) per violation,
could capture some of the return on their lion books have been digitized and indexed and each internet hit would constitute a viola-
work (hence the “exclusive” rights, which by Google, with tens of thousands being add- tion. This is a risk that neither Google nor any
are not completely exclusive, with good rea- ed every week) an interesting and instructive library is willing to take.
son). At the same time, they recognized that bifurcation has occurred. As result, most of the scholarly and cul-
knowledge and new discoveries are nonrival, Digitized works known to be in the pub- tural record of the twentieth century cannot
meaning that added users do not diminish the lic domain—including essentially everything be accessed by the methods preferred by pret-
uses of existing users (hence the free use after published in the United States before 1923 ty much everyone who reads in the twenty-
“limited times”). and many works published between 1923 first century. A professor wanting to assign a
Congress has repeatedly extended the and 1963—are easily available. They can be substantial portion of a book written in, say,
“limited time” that is covered by copyright, found through Google Book Search (books. 1961 (and out of print for 47 years), is gener-
with the result that most works written in google.com) and on the websites of many ally still required to put the book on reserve
the twentieth century are protected by copy- participating libraries. They can be read on- the old-fashioned way, even if the university
right and unavailable to be read on-line, even line or downloaded, and in the past several library has a digitized copy that could be put
when a perfectly readable scanned copy ex- months hundreds of thousands have been on a server and delivered to students at zero
ists. In brief, what’s at stake in the Google made commercially available through a vari- marginal cost.
Book settlement is our ability to find and ety of print-on-demand channels, as well as I have referred to books published after
read the literature of (most of) the twentieth on e-book readers. However, works that may 1922 as books that ‘may be’ in copyright. The
century on-line. still be in copyright are not so easy to find and copyright law is nothing if not complicated,
Of course, the great majority of works to use. Google shows only a brief snippet in and among its interesting features is that the
written in the twentieth century are out of response to an on-line search, along with in- current copyright status of books depends
print, and most have been out of print since formation about where a physical copy of the on dates of authorship and in many cases
shortly after their publication. book might be found. The reason for the re- on the details of registration and renewal of
Until Google began its mass digitiza- stricted usability of these works is simple: the copyright. To complicate matters further, for
tion of research library collections, access to penalties for displaying significant portions many books (the number is surely over half a
The Economists’ Voice www.bepress.com/ev October 2009
--million in the U.S., in the millions worldwide) the parties to the suit agreed to a settlement, obtain 37 percent of the revenue from both
the holder of copyright is not known and may with the plaintiffs claiming to represent a class the retail product and the site license, with
not exist, and often neither a living author that includes essentially all those who hold the rest to be distributed to rightsholders.
nor a still-extant publisher knows who holds copyright to works in libraries in the United The obvious benefit of the settlement is that
the rights to a given work. Such works are States. The settlement agreement cannot go it provides electronic access to many millions
generally referred to as ‘orphan works’ in the into effect without Federal District Court ap- of works at one fell swoop, saving the transac-
world of libraries and copyright lawyers, but proval, and is currently under revision as a tions costs that would be involved if Google,
they are really a particular kind of orphan— result of concerns that have been vigorously libraries, and others seeking to provide access
foundlings. Their parents (holders of copy- expressed by many parties, including the De- to the scanned works had to negotiate work
rights in them) are unknown. The existence of partment of Justice. by work and rightsholder by rightsholder,
orphan works of this kind greatly complicates Basically, the proposed settlement would assuming that rightsholders could be found.
the already complicated and often expensive create a market in electronically-available cop- The ability to search simultaneously the col-
effort involved in finding rightsholders and ies of out-of-print works that are plausibly in lections of the world’s great research libraries,
making arrangements with them for lawful copyright. Google would provide free brows- to browse those collections and to be able to
use of copyrighted works. ing access (usually 20 percent of a book would purchase immediate electronic access pro-
be viewable in a given search) and would sell vides uncalculated, but almost certainly large,
the lawsuit and proposed settlement permanent on-line access to complete versions consumer surplus.
G oogle announced its mass digitization
project with libraries in 2004. In 2005,
several authors and publishers of copyrighted
on behalf of itself and a newly-created Book
Rights Registry (BRR) that would represent
the interests of rightsholders of works subject
The settlement would also permit aca-
demic libraries and their universities, at least
after a time, to save a great deal of money
works, respectively working with the Authors to the settlement. Google would also sell site and space, as the necessity of holding exten-
Guild and the Association of American Pub- licenses to institutions such as colleges and sively duplicated print collections would be
lishers, sued Google for unauthorized copying universities, enabling students and employees eliminated. Moreover, the settlement includes
of copyrighted works. Google’s defense was to of those institutions to have access to the col- the orphan (foundling) works, removing the
argue that its indexing of the works and dis- lections in much the same way that they now risks that would otherwise attend to display-
playing of snippets constituted a fair use un- have access to electronic journals and databas- ing works where rights are unknown, and
der the copyright law. Some three years later, es purchased by their libraries. Google would adding to the value that would be available
The Economists’ Voice www.bepress.com/ev October 2009
--to students, professors, and other users of to scan libraries’ works and provide market ac- orphan works and provides for no mechanism
Google’s newly-created giant electronic book- cess by contracting with the BRR, only Google that could practicably convey such rights to
store. Inclusion of the orphan works is es- would be authorized to use the Google scans in other entities. Moreover, unlike the situation
sential to creating an effective product for the marketplace, and for at least the foreseeable when rightsholders are known, there is no
the academic market because without them future, the Google scans constitute the over- way for copyright holders of orphaned works
neither Google nor anyone else could risk whelming majority of scans, because no one to contract with other parties for distribution
putting collections on-line without costly else has been willing to commit the hundreds of those works, because it is in the nature of
establishment of rights (or the lack thereof) of millions of dollars necessary to scan the tens orphan works that the holders of the rights are
book by book, and the resulting collection of millions of works that reside in the world’s unknown. This leads the Department of Jus-
of out-of-print works would be seriously in- research libraries. tice to be concerned that the settlement, as
complete. One can never conclusively prove Many objections to the Google settlement drafted, “appears to create a dangerous prob-
a book to be orphaned. There is always the are based on a concern that Google and the ability that only Google would have the ability
possibility that a rightsholder will materialize, BRR will have monopoly power in the newly- to market to libraries and other institutions a
with a lawyer not far behind. developed market for electronic access to out- comprehensive digital-book subscription”(U.S.
of-print copyrighted works. Some assertions Department of Justice, p. 24).
objections in this regard are simply silly: Google will not
T he objections to the original settlement
agreement are many and varied. One set
involves privacy, which I do not consider here.
have a monopoly on access to the works, which
are still available in the source libraries. Nor
will it have been granted a monopoly on elec-
exploiting the orphans
T he disposition of both the orphan works
and revenues attributed to them are among
Others involve a cluster of legal questions, nota- tronic access to works with known rightshold- the most controversial features of the settle-
bly involving technical issues of civil procedure ers; such works may be rescanned and sold by ment. One important economic objection is
surrounding class action lawsuits, of which I other providers, including rightsholders them- distributional. There is clear public benefit to
have little interest and less understanding. Still selves, should it prove to be the case that the providing access to orphan works. But under
others have a good deal of economic content. market in these works is sufficiently profitable the settlement agreement, if the rightshold-
The settlement would plausibly bestow to attract entry. ers to orphan works are not found after five
considerable market power on the BRR and The orphan works are another matter. The years, the principal beneficiaries of the rev-
Google. Although other parties could choose settlement gives Google rights to distribute enues attributable to orphan works would be
The Economists’ Voice www.bepress.com/ev October 2009
--the authors and publishers who hold the rights Additionally, it seems likely that Google is more the scholarly community. All of the efficiency
to other works. Why them? Well to be hon- interested in attracting people to its site than it gains from the settlement’s treatment of orphan
est, one can’t help thinking that it is because is in profiting directly from sales of books, and works are due to the settlement’s waiver of legal
these rightsholders were active parties in the hence would prefer prices to be low. liability from their sale and display. That waiver
lawsuits whereas orphans, parents, consumers Sadly, I don’t have an estimate of the price makes the books available and generates value
and others were not. Other obvious possibili- elasticity of demand for out-of-print works for those who would search and read them.
ties would be to return these funds to consum- with unknown owners, but I am confident that The distribution of revenues to rightsholders
ers as rebates, to give them to the libraries that Google’s ability to exploit its monopoly posi- of other books serves no compelling distribu-
bought and preserved the works in the first tion in orphan works is far weaker than the tional interest.
place (would I have thought of this were I not ability of commercial journal publishers to Thus, any mechanisms that allowed other
Michigan’s librarian?), or to reduce the federal exploit their position in fields where getting entities (e.g. libraries, publishers, the Internet
deficit. the next essential grant requires immediate ac- Archive, Microsoft) to display and facilitate
That Google has an advantageous posi- cess to the most current published papers. The search of orphan works on the same or similar
tion with regard to the orphan works is clear. fear among some librarians, including Robert terms that Google has under the draft settle-
Whether that position is worth any money to Darnton of Harvard, that Google will be able to ment would realize the efficiency gains with-
speak of is an open question. Books that are in set extortionate prices in the manner of many out distributional harm. And by allowing entry,
copyright and out of print have already proved commercial journal publishers (not including any such mechanism would eliminate the most
themselves to be something less than star per- bepress), seems to me to misapprehend impor- troubling element of potential monopoly that
formers in the marketplace. To be sure, libraries tant differences between old books and current could arise from the settlement.
will find it valuable to have access to as com- scientific journal articles. Professor Darnton Thus a revised settlement (as suggested by
plete a collection as possible. At the same time, and I have debated the question at some length the U.S. Department of Justice, p. 25) that pro-
the settlement adduces a principle of ‘broad in a recent exchange in the New York Review of vided competitors with the ability to use the
access,’ in determining prices for institutional Books. orphan works on the same terms as Google, or
licenses. Moreover, the orphan works will con- Fortunately, concerns about legal barriers to legislation with similar consequence, would be
tinue to be available in print form and as part entry can be laid to rest by changing the treat- an unambiguous improvement over the origi-
of Google’s retail product, and 20 percent of ment of the orphan works while preserving the nal settlement. The great benefit of a new mar-
each book will be available for free preview. benefits of the settlement to the public and to ket in electronic versions of the literature of
The Economists’ Voice www.bepress.com/ev October 2009
--most of the twentieth century could be realized 56(2): February 12. Available at: http://www.ny
with reduced risk of monopoly and without books.com/articles/22281. (See also Paul
enriching unrelated parties with the fruits of Courant’s response and Darnton’s rejoinder.
orphans’ labor. In contrast, scuttling of the set- Available at: http://www.nybooks.com/arti-
tlement or greatly limiting the volume of works cles/22496.)
to be covered would put us back to where we Samuelson, Pamela (2009) “The Audacity of the
started—the only people with good access to Google Book Settlement,” The Huffington Post,
the scholarly and cultural record of the twenti- August 10. Available at: http://www.huffing
eth century would be people with physical ac- tonpost.com/pamela-samuelson/the-audacity-
cess to research libraries, and even for them, of-the-googl_b_255490.html. (See also links to
that literature would be more difficult to access other commentary by Professor Samuelson.)
than most works published before or since. U.S. Department of Justice (2009) “Justice De-
partment Submits Views on Proposed Google
Letters commenting on this piece or others may Book Search Settlement.” Available at: www.us-
be submitted at http://www.bepress.com/cgi/ doj.gov/opa/pr/2009/September/09-opa-1001.
submit.cgi?context=ev. html. (Case 1:05-cv-08136-DC Document 720.
Filed 09/18/2009.)
references and further reading
American Library Association, Available at:
Band, Jonathan (2008) “A Guide for the Per- http://wo.ala.org/gbs. (Google Book Search
plexed: Libraries and the Google Library Project Settlement website has many of the basic
Settlement,” Association of Research Libraries. documents and a good deal of commentary,
Available at: http://wo.ala.org/gbs/alaarl-sum- including a list of parties who filed comments
mary-document. (A link to the settlement itself with the court.)
can be found at the same URL.)
Darnton, Robert (2009) “Google and the Fu-
ture of Books,” New York Review of Books:
The Economists’ Voice www.bepress.com/ev October 2009
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