July 30 – Aug 6, 2009 Edition EDITORIAL–Consider Effects of Google Settlement as Deadline Nears

DALLAS (AUTHORLINK NEWS, August 1, 2009)–Authors and publishers have just a little over a month to decide whether to opt out of the book search copyright settlement between Google, and the Association of American Publishers (AAP) and the Authors Guild. The extended Opt-Out deadline is September 4, 2009, the date by which class members must decide whether to remain in the Settlement Class and receive the benefits of the Settlement, object to the Settlement, or opt out of the Settlement. Those wishing to remain part of the settlement must complete a Claim Form before January 5, 2010 to be eligible for a small cash payment.

A Fairness Hearing to decide whether to grant final approval of the settlement is scheduled October 7, 2009 at 10 a.m. in Courtroom 11A of the United States District Court for the Southern District of New York, United States Courthouse, located at 500 Pearl Street, New York, New York 10007.

Authorlink hopes that authors and publishers will clearly understand all sides of this issue before the Court case is decided, and also that authors and publishers will consider the long-term effects of the new rights structure that will be set in motion by the settlement . Here are a few issues to consider.

First, the Google settlement greatly expands the amount of copyrighted material that Google can display online for free. Instead of brief snippets from in-copyright works currently displayed by Google, the settlement allows up to 20 percent of the text of a book to be available without charge for online viewing.

The settlement establishes a Book Rights Registry to become a sort of super agency for the management of digital rights for Google. The Registry’s powers can then easily be expanded beyond Google to any digital reseller. This should raise some interesting questions for entities like the Association of Authors Representatives, whose AAR members heretofore have been overseers of their clients’ digital rights.

Has anyone out there examined the actual cost to the author of having two “middle men” (Google and the Book Registry), each taking cuts of revenue and exerting influence over pricing? The announced publisher/author share of consumer sales is 63%, while Google retains 37%. Sounds good. But there’s some fine print in the massive legal document that everyone in the industry should study. For example, the author’s or publisher’s actual take-home pay may not be 63%. The Book Rights Registry is structured to ultimately charge authors and publishers up to an additional 20% of sales revenues simply for “clearing” rights. This reduces payment to 43% (which must be apportioned between publisher and author). And if any disputes arise, the Registry can charge hefty legal fees to arbitrate disagreements.

There are also other troubling issues, such as price setting policies, and orphaned works. By opting into the settlement, an author can hope to recover about $60 per title and to be paid within about four or five years. Is the deal really worth it? The rightholder can already control his/her own title through Google’s book program? Why should every last author opt into the settlement, and by default into the Registry? We need to thoroughly understand the long-term implications of the settlement on authors, their agents, and their publishers before we opt in.

For a more detailed review of the settlement, please read my articles Google Settlement Has A Few Unseen Wrinkles for Authors and Experts Explain Google in Great Detail. Authorlink welcomes comments to