Google Beats Retreat on Book Search

Google (GOOG) took a beating at today's Judiciary Committee hearing, and it looks like it's decided to give its critics most of what they want. In a statement at the hearing, the company's main counsel, David Drummond, announced that Google Book Search will henceforth allow third parties—including rivals Amazon (AMZN) and Barnes & Noble (BKS)—to sell its digitized books on their own sites. "Google will host the digital books online, and retailers such as Amazon, Barnes & Noble or your local bookstore will be able to sell access to users on any Internet-connected device they choose," the company announced in a blog post. "Retailers can also pursue their own digitization efforts of out-of-print books in parallel."

This concession caps a brutal day for Google, in which the company spent hours squirming under a congressional spotlight. For months now, Google's rivals, Internet privacy groups, and nonprofit digitization advocates have lambasted the search giant's exclusive deal with the Authors' Guild and the American Association of Publishers, which set up a profit-sharing arrangement for "orphan books," or works that are out of print, but still protected under copyright. In the days leading up to today's hearing, rivals such as Microsoft Microsoft (MSFT) blasted the deal in a brief filed in federal court. ""The proposed settlement goes well beyond the legitimate role of a copyright lawsuit—resolving claims for infringement—and imposes a slew of provisions that would restructure the rights and remedies of absent copyright owners throughout the world," Microsoft's lawyers claimed, according to CNet. The Open Book Alliance, a consortium of groups opposed to the deal, likened Google's Book Search project to the old deal between Standard Oil and the railroad industries, which give Rockefeller an unbreakable monopoly on oil a century ago.

And at the hearing today, the head of the U.S. copyright office blasted the deal as nothing less than illegal. Remarking upon Google's plan to sell books without the prior consent of the authors, Marybeth Peters declared, "To allow a commercial entity to sell such works without consent is an end-run around copyright law as we know it."

Clearly, Google is getting more and more nervous about the growing army of groups and businesses opposed to its massive digitize-the-world's-knowledge project. Just a few days ago, the company had agreed not to sell digital books that may still be in print in European, in an apparent attempt to mollify the increasingly hostile European Commission. Now, it's trying just about anything to get its opponents to calm down.

We've long called for Google to extend its profit-sharing deal to other companies and nonprofits; Google claims it's not really in this game for the money, so such a concession would make most of this fight go away and ease concerns that it was essentially setting up a monopoly on a large swath of human knowledge. Today's announcement leaves a few questions unanswered, such as how Google, the copyright holders, and third parties will share the profit. Nonetheless, it's good to see Google moving in that direction.