Update: Google today hurdled a significant stumbling block with regard to its multi-billion-dollar Book Search project, agreeing to pay $125 million to put millions of books online and compensate authors for publishing their content.
Some $34 million-plus of the settlement will go to the creation of a Book Rights Registry, which I'll detail later, while the remainder will go to rightholders -- authors and publishers -- whose books Google has already scanned for its ambitious project. Book rightholders will receive a minimum of $60 per work. More information on the settlement claims can be found here.
In doing so, the search engine settled a more than two-year-old class-action lawsuit with book authors and the Authors Guild, as well as a separate lawsuit filed by five large publishers from the Association of American Publishers (AAP).
The suits were filed to halt Google from putting copyrighted books on the Internet for people to search and read, which the company wants to do as part of its Book Search quest to organize the world's information online.
Google currently offers readers access to more than 7 million books in their entirety online, and expects offer many times that if this deal passes muster with the U.S. District Court for the Southern District of New York.
"We expect that millions upon millions of out-of-print books, and many in-print books, will find a new home and new readers online," said Paul Aiken, executive director of the Author's Guild, on a conference call.
With the agreement, authors and publishers can choose to distribute their content online through Google Book Search. Readers can find these books online and decide to pay to read them in their entirety.
Authors, who may opt out of this program, decide what to charge to have their book read online and get paid a portion of a fee charged to the reader. Google will receive 37 percent of the fee, with the publishers and authors splitting the remaining 63 percent for the book.
Payments will be distributed from online access provided by Google through a new, not-for-profit Book Rights Registry, which will receive an as yet undetermined cut of the 63 percent of the proceeds authors and publishers split for books readers purchase online. This registry will also "locate rightsholders, collect and maintain accurate rightsholder information, and provide a way for rightsholders to request inclusion in or exclusion from the project," according to a Google statement.
U.S. copyrights holders can register their works with the Book Rights Registry and receive compensation from institutional subscriptions, book sales, ad revenues and other possible revenue models, as well as a cash payment if their works have already been digitized. This group will also resolve claims disputes between rights holders.
Importantly, Google Book Search users in the U.S. will be able to pay to read books online. Google will show ads in the preview pages of the scanned books, but not in the pages of the books. Revenues from Google ads shown on these pages will be shared between Google and the Book Rights Registry members at the same 37-63 percent split.
Libraries at the Universities of California, Michigan, Wisconsin, and Stanford will participate in the project, along with a number of other U.S. libraries that currently work with Google on Book Search.
The importance of the dÃ©tente between Google and the publishers groups can't be understated. In addition, to offering readers all over the world access to books that are out of print, each of the 16,500 libraries in the U.S. could get a free online portal to the books. Library patrons could print an unlimited number of pages from these books for a per-page fee to read at their leisure, according to Aiken. Authors and publishers will get paid on a per-page basis for this access.
Moreover, U.S. colleges and universities can buy subscriptions for online access to participating library collections, giving students unlimited access to books from their dorm rooms. Faculty members would get instantaneous access to the books as well.
However, the new service will only be available to Google Book Search readers in the U.S. Outside the U.S., readers will be able to search for books and read snippets of copyrighted books, but they won't be able to preview works or purchases access online unless a rightholder authorizes it.
David Drummond, senior vice president of corporate development and chief legal officer at Google, said the new Book Search offering will take a minimum of several months as it wends its way through the New York Court system.
The settlement agreement resolves Authors Guild v. Google, a class-action suit filed on September 20, 2005 by the Authors Guild and certain authors, and a suit filed on October 19, 2005 by The McGraw-Hill Companies, Inc.; Pearson Education, Inc. and Penguin Group (USA) Inc., both part of Pearson; John Wiley & Sons, Inc.; and Simon & Schuster, Inc. part of CBS Corporation. These lawsuits challenged Google's plan to digitize, search and show parts of in-copyright books and to share digital copies with libraries without the consent of the copyright owner.
Those are the facts as we know them. I'll blog more later on just how good a deal this is for Google.