GOOGLE SETTLEMENT STEALS RIGHTS AND REWARDS APPROPRIATION

I received another letter from the Google Book Search Settlement Administrator this week informing me that my rights will be affected by the proposed settlement of the class action suit against Google for copyright infringement by scanning books and other publications. I have been a de facto part of the class action lawsuit because I am the author of numerous books, chapters, and other publications affected by Google’s decisions to scan and sell copies of materials still protected by copyright.

The settlement has been supported by the Association of American Publishers—which represents major publishers—because it protects their interests, but it is opposed by the National Writers Union and the American Society of Journalists and Authors because it seriously degrades the rights and interests of those who actually write the content. The split between publishers and authors is not surprising because anyone who has observed the uneasy relationships between musicians, authors, scriptwriters and recording, publishing, and production companies immediate recognizes they have very different and competing interests.

Under the proposed settlement, the court will take away portions of my copyrights that were created under legislation and protected by international treaties and it will give them to Google. The only way for me to protect my rights is to take deliberate affirmative action to opt out of the settlement and to seek to enforce my rights against Google individually—not a great option since its capacity to hire lawyers and stretch out litigation is far higher than mine.

The process and effects of the settlement are stunning and will dramatically alter authors’ rights. For nearly a hundred and fifty years copyright law has recognized that copyrights belong solely to the author (or persons to which the authors sell them) and that commercial uses of copyright material can only be made through negotiating terms of use and payment with the copyright owners.

The Google settlement will essentially rewrite copyright law by allowing the company to use the material without permission, without negotiating how the material will be used, and without negotiating compensation and payment provisions. It is particularly offensive because the court will be saying the government doesn’t have to protect authors’ rights, but authors’ have to protect their own rights. This is a significantly different approach from that which prosecutors and courts have taken in the cases of music, game, and software file sharers who have violated copyright on the Internet.

The settlement disassembles the basics of copyright law without legislative consideration and essentially forces the results on rights holders. Its effects are far reaching. Not only does the settlement apply to U.S. authors, but it is binding to authors worldwide even if they are not aware their rights are affected by the suit.

The settlement turns copyright upside down. Instead of protecting authors’ rights, the proposed settlement asks the court to reallocate the economic and moral rights to authors’ work, to give Google rights to use their material, and to determine the compensation authors must accept. To make matters worse, the effect of the settlement essentially gives Google a monopoly over the scanned publications and does require the company to make them available to other online services that might offer them at different prices or with different compensation for authors.

The proposed settlement is theft—pure and simple—and its proponents want to ravage and rewrite authors rights so that Google's acts will no longer be defined as larceny. The result will reward Google for illegally appropriating material, hardly a message that society should want to send to thiefs.

If the court accepts the settlement, authors will be victimized for the sake a $150 billion Internet company and the world’s biggest publishers. Where is the equity and the justice?

MEDIA FIRMS INCREASINGLY CHARGED WITH COPYRIGHT VIOLATIONS

First it was record companies suing Napster and peer-to-peer file sharers, and then it was media companies such as Viacom, Universal Music Group, and Agence France Presse suiting Google, YouTube, and Facebook for distributing content whose rights they owned. Now GateHouse Media has filed suit against another newspaper firm, the New York Times Co., for publishing content from its websites and papers on Boston.com.

That media companies are suing each other is a sure sign of the maturation of online distribution and that money is starting to flow—albeit slowly and at levels far below that of traditional media, which still account for more than two-thirds of all consumer and advertiser expenditures

But the lawsuits really point out the weakness of revenue distribution for use of intellectual property online. In publishing, well-developed systems for trading rights and collecting payments exist. In radio, systems for tracking songs played and ensuring artists, composers, arrangers, and music publishers are compensated are in place and working well. The trading of rights for television broadcasts and mechanisms for payments to owners of the IPRs are well established.

However, effective systems are absent in online distribution and the industry needs to move rapidly to establish them. If the industry can not create such a system on their own, more money will go to lawyers and the rules and systems for online payments will ultimately be imposed by courts or legislators who tire of the governmental costs for solving disputes and enforcing the rights.

Organizations representing print and audio-visual media need to sit down with their major counterparts in online distribution to create a reasonable mechanism by which rights are traded and revenues shared, otherwise they risk imposition of a government imposed compulsory license scheme that will be less desirable to the industry.

Companies that continually argue there should be less government regulation of media operations can’t increasingly go to government to solve their disputes without expecting it to produce more regulation.

ONLINE AND MOBILE REVENUE POTENTIAL DRIVE COMPENSATION DISPUTES

The issues in the Hollywood writer’s strike, which began Nov. 5, are symptomatic of a broader challenges that online and mobile media pose for all content creators. The fundamental issues for all media involve how to obtain revenue for content distributed by digital media and how to share revenue from those downloads.

In the Hollywood case, the central issues revolve around new media residuals for advertising supported video downloads of content prepared for TV and motion pictures, made for Internet content, and other streaming video. Screen writers, who did not foresee the success of VCR and DVD sales of motion pictures and television programs in past negotiations, are determined to receive greater compensation for the growing business in digital downloads.

The Alliance of Motion Picture & Television Producers argues that business potential of new media is uncertain and does not wish stipulate a monetary value for it. The Writer's Guild of America has asked for a $250 residual for one year of unlimited streaming of an hour-long show and 3-cents-per-download—the rate writer’s receive for DVD sales.

The rhetoric of the dispute has involved standard finger pointing with the producers’ group accusing writers of “quixotic pursuit of radical demands” and the writers accusing the producers of “corporate greed.”

Whatever the truth of those claims and the outcome of the work stoppage, there will be more disagreements in the coming years among those who actually produce content and those who employ creators or ultimately own the content because the issues are far broader and deeper than the screen writers challenging program and film producers. The underlying issue of what compensation creators deserve is growing in all media industries and digital downloads increasingly play important roles in their businesses.

In the past 20 years, at the behest of large commercial media firms, Congress past more copyright legislation than in all the years of the previous century combined. It extended the length of copyright, gave copyright protection to performers, games, and broadcasts, provided more protection and stronger penalties for digital than analogue content, and criminalized copyright violations.

The rhetoric of the media industry throughout the debates was consistent: If creators of content aren’t protected and compensated, no one will create articles, books, music, scripts, etc. However, the effect of the copyright legislation did not effectively strengthen the position of authors, composer, performers, or artists, but reinforced the power of copyright owners--essentially film, television, and recording companies, newspaper, magazine, and book publishers. Today, creators of content are now beginning to use the rhetoric that media firms used in copyright debates in their attempts to gain more compensation because of the growing revenue streams in digital media.

Although the full financial future of digital media is uncertain—as in any emerging industry, media firms are investing billions based on an upbeat assessment of its business opportunities. Twentieth Century Fox just announced a deal to rent its movies through digital downloads from the iTunes Store, which sold more than 200 million video downloads in 2007. Viacom signed a $500 million online advertising and content distribution deal with Microsoft covering the websites they both operate such as MTV, Comedy Central, MSN, and Xbox Live. You Tube was purchased by Google for $1.65 million and subsequently acquired the ad-serving firm DoubleClick for $3.1 billion in order to improve its ability to earn ad revenue on You Tube and other sites.

Although there is business risk involved in these ventures, digital media are clearly growing and are expected to produce handsome rewards. Downloads of movies and TV produced only $250 million in 2007, but are forecasted to reach nearly $2 billion in just 2 years. Digital downloads of music have already surpassed that mark and U.S. newspapers had online advertising revenue of $2.6 billion in 2006. There is money to be made in digital media and the amount is rising rapidly.

The growing value of digital downloads is one of the reasons why Viacom sued You Tube in 2007 for $1 billion in damages when 160,000 clips of its programs that were found on the online site. When media companies sue each other, you know that real money is at stake.

Arguments made by Hollywood producers that they are uncertain if there is money to be made in downloads are hollow given their own investments. It appears they are trying to reduce their business risk and to increase their profits by keeping writers’ compensation low and stropping them from gaining a stake in the growth of downloads.

The issues of compensation that led screenwriters to strike are confronting writers and photographers for newspapers, magazines, and books, independent video producers posting material on social media sites, and citizen journalists whose articles, photos, and videos are being use by commercial media and their digital sites--sometimes replacing paid content of professionals.

Now that online services are beginning to generate significant revenue streams for print media, journalists’ and writers’ desires to gaining more compensation for those uses of their work are rising. Although some papers and magazines agreed to provide nominal payments or salary increases for secondary uses of print content online, most have not yet come to terms over the growing revenue stream and how its benefits should be shared.

One can expect issues of compensation for digital materials to gain greater significance as negotiating points for the Newspaper Guild and the National Writer’s Union in the years to come. Both have lent their support to the Writer’s Guild of America and their members are increasingly aware of the effects of the new revenue streams on the companies that employ them.