Google narrows book rights in revised settlement
Google scaled back its ambitious digital book project in a revised legal settlement announced late Friday that would narrow its control over millions of online titles.
The concessions come after heavy scrutiny by the Justice Department, Web competitors and some authors groups who said that the original $125 million agreement with authors and publishers would give Google too much control over pricing in the distribution of book titles and could edge out competitors. They also argued that the deal would allow Google to profit off of the scanning and distribution of books whose authors are unknown, violating copyright laws.
The new settlement was submitted just before midnight to Judge Denny Chin of the U.S. District Court of Southern District of New York, who will ultimately decide whether to approve the deal.
Among several changes, the parties agreed to hand over control of so-called orphan works -- books whose copyright holders are unknown or not found -- to an independent trustee who would administer the licensing of those titles. Previously, Google would have controlled rights to those books.
Under the new agreement, the court must approve the appointed trustee, who would have authority to license those orphan works to other companies, including Google competitors Amazon and Microsoft. The trustee would also handle funds generated from those licenses. If unclaimed for 10 years, those funds would go to charities in the United States, Canada, Australia and Great Britain. After five years, a portion of those proceeds would also go to tracking down the holders of rights to orphan works.
“We’ve made a number of changes to the agreement to address concerns raised, while preserving the core principles of the agreement,” Google and parties in the settlement said in a statement.
The new settlement also included details on Google's algorithm for pricing online books, seeking to allay concerns by the Justice Department's antitrust watchdogs that pricing practices not harm competition and not violate consumers' interests.
The parties also narrowed the international scope of the works to be scanned, including only books that have been cleared by the U.S. Copyright Office. The books are limited to those from the United States, Great Britain, Canada, and Australia. The governments of France and Germany had objected to the settlement.
“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,” Google wrote in a blog. “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.”
Google and the Authors Guild and the American Association of Publishers changed their $125 million settlement first struck 13 months ago after the Justice Department said it would not approve the deal because of concerns over copyright infringement and antitrust violations.
The Justice Department wasn’t immediately available for comment.
November 14, 2009; 12:49 AM ET
Categories: Antitrust , Google
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