Privacy Matters

In the media black hole of last Friday afternoon, Google issued a mea culpa for gathering personal information, passwords and emails from unencrypted personal Wi-Fi networks.

This revelation was far different from the company’s initial response months ago when they assured the public that there had been no illicit data capture.  In the intervening months, the Wi-Spy scandal has drawn broad criticism from state Attorneys General, members of Congress and multiple foreign governments.

Privacy breaches like Wi-Spy, and Google’s lack of transparency in reporting the matter, are exactly the reason why many GBS stakeholders are reluctant to hire the search giant to be the world’s librarian.

Public interest groups have voiced strong privacy concerns about Google’s potential ability to aggregate and market the personal reading habits of the globe.  In an article titled, “Don’t Let Google Close the Book on Reader Privacy,” the EFF’s Cindy Cohn wrote:

“Google is poised to radically expand its book service, monitoring the digital books you search, the pages you read, how long you spend on various pages, and even what you write down in the margins. Google could then combine your reading habits with other information it has about you from other Google services, creating a massive “digital dossier” about you, your interests, and your concerns. With numerous reports of government efforts to compel online and offline booksellers to turn over records about readers, the time is now for Google to pledge to protect reader privacy.”

The New York Library Association has also weighed in on the matter, citing “patron privacy” as one of their primary GBS concerns.

The bottom line is that most readers assume a level of privacy protections and anonymity when they use resources like a public library.  Google has made an aggressive pitch that they can exclusively fill that role, but revelations like Wi-Spy certainly don’t help to convince the public.

More Monopolistic Musings

An approved Google Book Settlement would deliver Google an online market free of competition.

That’s the conclusion of Technology Review’s Christopher Mims after parsing through University of Chicago Law professor Eric Fraser’s exhaustive paper on the GBS.

In distilling Fraser’s work, Mims notes that Google’s decision to copy first and ask forgiveness later means that no other organization can expect to compete on the same terms as those granted through the GBS.

Specifically, Mims reports that:

This means that under the current settlement, there is no reasonable expectation that a competitor to Google Books will or could ever arise. Because Google will be allowed to set prices more or less in collusion with publishers, this will give Google no effective competitors in this space. Google will be a de-facto monopoly. “The parties to the actual lawsuit–Google on the one side and authors/publishers on the other side–all benefit from the settlement agreement because it enables collusive pricing,” Fraser said via email.

Of course this is one of the myriad reasons that the Department of Justice and others opposed the revised settlement.

Meanwhile, while experts like Fraser chronicle monopolistic misgivings about the GBS, the folks at Google continue to crow about their ongoing book scanning.

On Thursday, Google engineering director James Crawford wrote about the project’s success at scanning, “more than 15 million books from more than 100 countries in over 400 languages as part of the Google Books project we started in 2004.”

Ironically, Mr. Crawford speaks to ongoing partnerships with librarians and authors as key to the project’s success.  Unfortunately, we know a few authors, librarians and publishers that would disagree.

The GBS as a Benchmark

In a recent Forbes blog post, Washington Legal Foundation chief counsel Glenn Lammi points to the ongoing Google Book Settlement debate as a prime example of the government stepping in to check questionable online market behavior.

From the post:

DOJ’s inquiry into the Book Search suit settlement remains open, and Judge Chin has yet to rule on whether the settlement is “fair” to the parties.  His ruling, and DOJ’s possible actions in light of the outcome, will be highly instructive for those wishing to determine how government regulators will approach digital commercial behavior – especially by those with market power – in the future.

Lammi pulls highlights from the two Department of Justice filings sent to Judge Chin, noting that their actions helped send the initial deal back for revisions. Specifically, Lammi notes the DOJ’s concerns over Google’s ability to control the online book market if the GBS is approved.

Most importantly for the larger debate on online commerce and antitrust, DOJ expressed its strong concern that the new agreement did “nothing” on the “core issue” of “the ability of Google, and no other entity, to compete in a marketplace that the parties seek to create.”   The brief added, “There is no serious contention that Google’s competitors are likely to obtain comparable rights independently.”  To do so, competitors would have to copy books without publisher or author permission, and then hope a lawsuit (and its settlement) would follow.  Such an approach, DOJ wrote, “is poor public policy and not something the antitrust laws require a competitor to do.”

Clearly, the DOJ is right to be concerned about companies willfully ignoring copyright law as a business model.

That said, the scanning continues while we wait for Judge Chin to hand down his verdict.  By our count, the number of books in Google’s private library is now well into the millions and growing by more than 1,000 pages an hour.  We hope that number that will soon slow thanks to the DOJ’s measured intervention.

Sidestepping Congress

Copyright guru Pamela Samuelson has delivered a thorough analysis of motivations and challenges facing the GBS parties.  Her article, The Google Book Settlement as Copyright Reform, to be published in the Wisconsin Law Review, highlights just how complex and far reaching the settlement is.  The article also demonstrates how the proposal is a vehicle to replacing Congress as the driver of copyright reform.

On the motivation for Google undertaking the book scanning project and risking legal action, Samuelson writes:

Google undertook the GBS initiative not only because it wanted to attract more users to its search engine and supply them with snippets of information contained in the many millions of books it was scanning; it also wanted to make ―non-display uses of the books’ contents for purposes such as fine-tuning its search engine and language translation technologies. As one Google employee has observed, ―the very worst [search] algorithm at 10 million words is better than the very best algorithm at 1 million words. The best way to improve search technologies, he pointed out, is to get more data. It is obvious that books from major research libraries are dense with data.

Google‘s motivation to settle the Authors Guild lawsuit was not just, and probably not mainly, to avert the risk of statutory damage liability, but more substantially as a means to generate revenues from which it could recoup the costs of the GBS initiative. Google is an amazingly innovative and successful company, but thus far, it has been, as Steve Ballmer has put the point, ―a one-trick pony, in that it makes the overwhelming majority of its revenues from search-related advertising.

Eric Schmidt, Google‘s CEO, has said that he likes this pony very much, but he has also been cajoling Google staff to develop new revenue sources. The settlement, if approved, would generate considerable revenues for Google, as it would then be authorized to serve ads against GBS content, most of which it could keep for itself.

Too true, but hardly the same motivation that was described by Sergey Brin in his October 2009 New York Times op-ed that compared the GBS to an eternal library at Alexandria.

To be fair, all parties can agree on the benefits of safeguarding the planet’s literary treasures. But the question has been, and continues to be, is a unilateral project by a for-profit company that side-steps congressional authority an appropriate method of achieving the goal?

The full synopsis of Pamela Samuelson’s paper is below. It should be required reading for all GBS watchers.

An intriguing way to view the proposed settlement of the copyright litigation over the Google Book Search (GBS) Project is as a mechanism through which to achieve copyright reform that Congress has not yet and may never be willing to do. The settlement would, in effect, give Google a compulsory license to commercialize millions of out-of-print books, including those that are “orphans” (that is, books whose rights holders cannot readily be located), establish a revenue-sharing arrangement as to these books, authorize the creation of an institutional subscription database that would be licensed to libraries and other entities, resolve disputes between authors and publishers over who owns copyrights in electronic versions of their books, provide a safe harbor for Google for any mistakes it might make in good faith as to whether books are in the public domain or in-copyright, and immunize libraries from secondary liability for providing books to Google for GBS, among other things.

This Article explains why certain features of U.S. law, particularly copyright law, may have contributed to Google’s willingness to undertake the GBS project in the first place and later to its motivation to settle the Authors Guild lawsuit. It then demonstrates that the proposed settlement would indeed achieve a measure of copyright reform that Congress would find difficult to accomplish. Some of this reform may be in the public interest. It also considers whether the quasi-legislative nature of the GBS settlement is merely an interesting side effect of the agreement or an additional reason in favor or against approval of this settlement.