Write a 5 page paper (1500 or more words) in APA format in response to the following:

Read the APPLICATION CASE on Pages 561 to 565 called, “The Google Books Settlement: Is It Fair?”

The Google Books Settlement: Is It Fair? In the Internet age, books are supposed to die off and go away. Who wants to read books when YouTube streams over 60 billion videos a month in 2011, covering most topics known to man, and Google can provide online access to the world’s information? Steve Jobs noted in an interview about the Kindle e-book reader, “It doesn’t matter how good or bad the product [e-book reader] is, the fact is that people don’t read anymore. Forty percent of the people in the U.S. read one book or less last year. The whole conception is flawed at the top because people don’t read anymore.”

Actually, in 2010, 2.57 billion books were sold, generating around $28 billion in revenue, a 3% increase since 2009. According to the American Association of Publish- ers, e-book sales exploded in 2010, growing from 0.6% of book sales in the United States in 2009 to 6.4%. Books continue to be a very hot topic in 2011 as e-readers and the iPad have exploded in popularity and Google battles the major heavy-hitter tech companies, authors, publishing firms, the United States Congress, the Department of Justice, and the European Commission over the future of online digital books. Google is on a tear to put everything digital on its servers and then, as the found- ers promise in ceaseless self-congratulatory announcements, provide access to “all the world’s information” through its efforts. And make a buck, as it turns out, by books, and relevant portions, available to millions on the Internet, and perhaps even helping publishers sell new copies of books that currently sit on dusty library shelves. In 2005, the publishing industry struck back at Google’s book-scanning program and two lawsuits were filed in federal court in New York, one a class-action suit by the Authors Guild and the second by five major publishing companies (McGraw Hill, Pearson Education, Penguin Group, Simon & Schuster, and John Wiley & Sons), claiming copyright infringement. The publishers’ consortium, the American Associa- tion of Publishers (AAP), alleged that Google was claiming the right to “unilaterally change copyright law and copy anything unless somebody tells [them] “No” [making it] impossible for people in the intellectual property community to operate. They [Google] keep talking about doing this because it is good for the world. That has never been a principle in law. They ‘do no evil’ except they are stealing people’s property.” Or, as one commentator put it, it’s like having a thief break into your house and clean the kitchen—it’s still breaking and entering.

Google, on the other hand, claimed its use was “fair” under the “fair use” doctrine that has emerged from a number of court decisions issued over the years, and which is codified in the Copyright Act in 1976. The copying and lending of books by libraries has been considered a fair use since the late 1930s under a “gentleman’s agreement” between libraries and publishers, and a library exemption was codified as Section 108 of the Copyright Act of 1976. Libraries loan books to patrons for a limited period, and must purchase at least one copy. Many people read books borrowed from libraries and recommend them to friends, who often buy the books rather than take the time and effort to go to a library. Libraries are also considered by many in the publishing industry as helping to market a book to a larger public, and libraries are believed to be performing a public service by increasing literacy and education.

In 2008, Google agreed to a settlement of the lawsuit with the authors and pub- lishers. Google decided to cut a deal for cash and other considerations. In return for the nonexclusive right to sell books scanned into its database, place advertisements on those pages, display snippets, and make other commercial uses of its database of scanned books, Google agreed to pay about $125 million to the parties. Of this amount, $15 million will be used to reimburse legal expenses and establish a fund to aid authors and publishers in pursuing their rights; $45 million will be put into the settlement fund for books digitized prior to an opt-out deadline (September 1, 2009); $34.5 million will be used to fund the launch of a central registry of books involved in the program; and the remaining $31 million will be used to pay for administrative and operating expenses of the registry. In addition, Google agreed to pay the registry 70% of Google’s revenues from the project, less 10% for operating expenses. No provi- sion is made in the agreement for (a) public domain books (government and out-of- copyright books) and (b) “orphaned books” where the copyright holders cannot be identified. All books that Google digitizes will be listed in the central registry available to the public on the Internet.

In 2009, a flurry of companies such as Microsoft, Yahoo, and Amazon, university groups, private organizations such as the American Association of Publishers, members of the Author’s Guild, and publishers in the European Union all filed briefs with the court disputing the settlement. The technology companies formed the Open Book Alli- ance to oppose the settlement. They were joined by privacy protection groups who claimed (not without merit) that Google would be able to track whatever e-books people accessed and read. Sony is the only technology company supporting Google. European publishers, authors, and copyright holders have also objected to the proposed settlement in the American courts. In September 2009, representatives of those groups spoke out at a hearing sponsored by the European Commission against the proposed deal. They said it would give Google too much power, including exclusive rights to sell out-of-print works that remain under copyright, a category that includes millions of books.

The Justice Department is also investigating the antitrust implications of the settlement. Critics argue the settlement will create a de facto monopoly position for Google, make it difficult for competitors to enter the field, and give Google broad copyright immunity. The settlement provides that Google’s access to publishers’ books is “non exclusive,” but competitors would have to scan all the same books over again in order to establish a competitive position, something that experts believe is financially prohibitive. Google, and settlement parties, including the AAP and Author’s Guild, argue the settlement will expand digital access to millions of books that are gathering dust on library shelves. Critics retort that Google’s database of books will be exclusive, not available to other firms or nonprofit groups, and the costs of developing an open source, competing database of scanned books would be prohibitive. Google, they argue, would end up owning the digital book, which is like owning the libraries of the future.

Currently, Google has reportedly scanned about 15 million books. About 2 mil- lion of those are in the public domain, and can be viewed for free through Google’s Book Search. Google Book users can also view previews of another 2 million books that are in copyright and in print, under agreements with various publishers. The remainder of the scanned books are out of print but still in copyright. These are currently available only in short “snippet view.” The settlement would have allowed users to preview longer parts of those works and potentially purchase them in their entirety, but in March 2011, Federal Judge Denny Chin rejected it, throwing the proj- ect into legal limbo once again. Citing copyright, antitrust, and other concerns, Chin said that the settlement went too far, and would give Google a “de facto monopoly” and the right to exploit and profit from books without the permission of copyright owners, particularly the authors of “orphaned” works whose content owners Google could not identify. The judge said that he would consider a revised settlement that addressed these concerns, suggesting that copyright owners be given the right to “opt in” to the settlement rather than “opt out” as originally proposed. An “opt in” structure had previously been rejected by Google as unworkable. In September 2011, with no progress apparently made in the direction of a new settlement, the judge put the case on the pathway to trial sometime in the fall of 2012.

In September 2011, in a related action, the Authors Guild filed a new lawsuit related to the Library Project, suing Google, the university consortium HathiTrust, and five universities that are participating in the book-scanning project. The suit charges that the scanning of 9.5 million works in the HathiTrust repository consti- tutes massive copyright infringement, and also takes issue with HathiTrust’s planned October 2011 launch of its Orphan Works Project, which would make available scans of books it had concluded were available after failing to locate valid copyright hold- ers. Interestingly, as soon as the list was made public, a crowdsourcing effort quickly located some of the authors that purportedly could not be found. That suit must also wind its way through the legal process, presenting a further bar to Google’s efforts to provide access to, and potentially profit from, all of the books in the world.