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Is Google's culture grab unstoppable?

Monopoly Money from Digital Books

Who Cares Who Owns It?

The Google Books registry has two big parts, one part used by authors to register their works and set commercial rules. The other is the technology build by and operated for Google: the vast databases, rulesets, accounting systems and operating code.

It matters if Google even nominally controls the books registry. The registry is a natural extension of search. Search identifies content, but a registry can tell you who owns the content you found, what that owner wants done with their work and how much they want to charge - or that the owner doesn’t care to hear your offer or have anyone sell advertising in their book. Silence does not, and should not, equal consent.

An opt-in registry is as essential to the online monetization chain as a county recorder’s office is to the real property market. But the Google Books registry is opt-out - meaning that until a copyright owner notifies the registry that they don’t want their works exploited, the works can be commercialized. In the Google world, silence equals consent - even if there’s no reasonable way an author could ever know of the exploitation. An opt-out registry is not neutral - it clearly benefits the registry owner.

Allowing a content registry to be controlled by a company that also exploits that content creates anticompetitive conditions even without the MFN. Potential competitors will worry that their business depends on an infrastructure controlled by a dominant competitor.

History shows that if a company that does the paying also does the counting, there is an inherent tendency for shenanigans against the creators. Imagine if the British performing rights society the MCPS-PRS Alliance outsourced its royalty collection and accounting to broadcasters. The fox would be in the chicken house, and the writers would revolt.

To the Universe, and beyond

But wait: Google is just getting started. As Google's Sergey Brin told the Wall Street Journal:

WSJ: Is establishing a registry for rights holders a model that Google thinks it can replicate in other areas of digital media, like video?

Brin: Very much so. In fact, with video and our fingerprinting technology, we are essentially building the [opt-in] registry. We have a number of big media companies that send us their raw video files and we fingerprint that and we can attribute those videos to them.

Regulators should care who controls the Google Books registry because it can easily reach out to other content. Google is well on its way to dominating all search and advertising, and now maybe a significant share of online content. Google’s ability to accomplish transparent accounting is definitely in doubt.

What's good for General Google is good for the USA

The Google Books lawsuit demonstrates that it is nigh impossible for individual creators to stop the rampage of a corporate King Kong that is willing to spend endless sums on lawsuits to commoditize art. The unspoken lesson to every young entrepreneur in Silicon Valley is to stonewall—litigate if you can, particularly if you are richer than your opponent. Do not underestimate Google’s influence on the Valley - who would argue with the "mind of God"?

Only governments can take on Google-sized bad boys when the big dogs come after your culture. Governments are concerned about the market power of big search companies - this settlement should alarm both regulators and consumers.

As the Booksellers Association correctly concludes, "[A]n over zealous embrace of this new Google initiative may well, in the long term, deliver a more limited route-to-market for books rather than the incremental benefits that seem to be the current perception."

So what might a better policy look like?

The plaintiffs got it half right - our business needs a registry. But that registry ought to be independent, and opt-in. If the Google class action settlement is approved, US courts will essentially create the opposite - an opt-out registry controlled by a dominant player with "most favoured nation" price protection. It is a fundamental principle of international law that an author should not be compelled to submit to formalities (such as an opt-out registry) in order to enjoy their rights.

But the borderless Internet drives creators toward at least pan-economic area licensing to encourage and facilitate competition among legitimate businesses. It is hard to see how a single-purpose opt-out books registry with a goodie-laden court-ordered license reached in the context of unequal litigation furthers any worthwhile public policy.

Regulators urgently need to take a closer look at this settlement. A win-win resolution of the harms done by Google to the authors and publishers would be to make Google pay for (or at least pay to start) a truly independent registry in line with current policy trends that could further these goals of cultural protections for all authors and citizens, voluntary opt-in licensing regimes that promote competition, and royalties for creators.

Unfortunately, it appears that creators are getting Googled - again. ®

©2008 Christian L. Castle

Editor's note: Attorney Chris Castle was a attorney for the original Napster: read our interview with him here.

Related links

Settlement Summary (pdf)

The Agreement

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