Why Publishers Can’t Stand Google’s Universal Library

Alexander Moschina
by Alexander Moschina, Managing Editor, Investment U

Why Publishers Can't Stand Google's Universal Library

by Alexander Moschina, Investment U Research

Tuesday, April 12, 2011

For seven years now, Google (Nasdaq: GOOG) has been scanning every book it can get its hands on. Its goal? To take out-of-print, public-domain titles and make them available on the web - for free.

The internet giant has even partnered with some of the largest libraries in the world to include their rarest collections in its universal library.

And for more modern in-copyright titles, the internet giant would create listings that include ISBN numbers, sample pages and other relevant information. The idea is that this would make it easier for users to track down physical copies.

Everybody wins, right? Think again...

Publishers/Rivals Don't Want Google Profiting from Someone Else's Work

Publishers feel that if Google posts their titles on the web - even if it's just a sample page or biographical info - the company will have infringed on their copyrights. After all, the company is making money via page hits and advertising.

Among those who objected to Google's plan were...

  • The Authors Guild,
  • The Association of American Publishers,
  • And the Open Book Alliance, whose members include Google rivals, Microsoft (Nasdaq: MSFT), Amazon (Nasdaq: AMZN) and others

In response, Google suggested an "opt-out" agreement. If an author or publisher doesn't want their title listed, all they have to do is say so. Google will then remove it from the site. Simple as that.

And this way, the company could continue scanning anything and everything.

The compromise was, for the most part, well-received by publishers. Then on March 22, federal judges shot down the settlement...

Federal Judges Shut Down Google's Universal Library

According to Judge Denny Chin, the deal would have given Google "a significant advantage over competitors, rewarding it for engaging in wholesale copying of copyrighted works without permission."

As an alternative, Chin suggested the company switch to an "opt in" policy, where publishers must request to have their works included. This would, of course, significantly shrink the size of Google's digital collection, but in time content owners may warm to the concept.

Authors Guild president Scott Turow even admits that the online library is "an idea whose time has come." And if the terms are right, Google could eventually get its way (no doubt a relief for the company, since it has already scanned in more than 12 million books).

But what will happen to orphaned books like Frankenstein or Dante's Inferno - titles with no living right holder? Should Google become the de facto guardian, just because it's creating this universal library? Chin believes these issues should be decided by the U.S. Congress - and not by groups with private interests (e.g. Google, Amazon, publishers, and so on).

So even if Google relents and switches to an "opt in" policy, there is still a lot to be worked out. Still, the gears are turning. And it leaves us wondering if someday soon we will see a Google-branded e-reader... or even a Google publishing house...

Good investing,

Alexander Moschina

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