What Google's Settlement with Publishers Means

(MoneyWatch)  A trip to a great bookstore, say Powell's in downtown Portland, Oregon, is all that's required to glimpse the enormous breadth and depth of intellectual property locked away in rare and out-of-print books. Searching through shelves of old books, seeking treasures, offers a certain pleasure few other activities can replicate.

But, imagine being able to search through millions of these books on your laptop in the form of a free, fully searchable database that contains snippets of out-of-print but copyrighted material. Once you determine from a snippet that you want to purchase the complete version of a book, you can gain full online access.

This new structure for gaining access to essentially lost knowledge is one of the public benefits that should result from today's announcement that a lawsuit brought by publishers against Google three years ago has been settled. Google is shelling out a lot of cash, in various ways to various parties for the right to go ahead and invent this new digital library.

Now, while I'm not ready to predict that this will be the YouTube of the book industry, it should extend the "long tail" of content further out to parts of the content universe it's never been able to reach before. It is not difficult to imagine tens of thousands of people, conservatively, searching through the non-profit Book Rights Registry envisioned under today's settlement, and finding gems that then can be shared with others.

As I've said before, this kind of business model presents the classic win-win-win. Consumers hungry to search for great content (and then equally happy to share it), provide the labor (when it comes to books, a true labor of love). The publishers and authors who hold copyright to the material get 63 percent of the sales, subscription and advertising revenue associated with all this activity; and Google, which supplies the technology, the vision, and most of the up-front investment costs, gets the rest. In the process, Google has established yet another long-term search product it can monetize better than any of its competitors.