In case you need a recap of what this is all about, the Google Books Amended Settlement Agreement (ASA) was a proposed agreement arranged by some publishers, authors, and author groups as a way to create a compensation and licensing system for Google Book Search, which uses the full text of copyrighted books to provide snippets in search results. Some authors and publishers claim that what Google is doing with Book Search amounts to widespread copyright infringement instead of fair use. For those authors and publishers who had sued Google, the proposed settlement would have protected them from the risk of losing on fair use grounds if the suit proceeded. More controversially, it would have also implemented an opt-out system (instead of opt-in) for authors, and an arbitration system that favored Google and publishers at the expense of authors’ rights. From a competition perspective, it would have also shielded Google from more lawsuits, while leaving competitors unprotected.

U.S. District Court Judge Denny Chin rejected the ASA this past March, noting among other things that it went too far in giving Google special privileges (especially regarding orphaned works), and that the opt-out system was unfair to authors. While that pretty much left it dead in its current state, it also left the door open for Google and the plaintiffs to amend the agreement and try again.

But with yesterday’s rejection of a settlement in Freelance, it looks like there’s no possible way for the ASA to proceed.

Freelance is a class action case from the 90s (actually Tasini v. New York Times), and it involves freelance writers who claimed newspapers didn’t have permission to post their work online without compensation. Its relevance to the ASA is that in both lawsuits, the plaintiffs tried to create a single class out of all authors who might be affected by the issue, and yesterday’s Second Circuit Court of Appeals said that was more or less impossible:

In a 2-1 ruling, the second circuit yesterday held that the district court which approved a settlement between freelance writers and publishers in the class action case known shorthand as Freelance “abused its discretion in certifying the class and approving the Settlement, because the named plaintiffs failed to adequately represent the interests of all class members.”

In really plain language, essentially the judges who rejected Freelance‘s settlement yesterday acknowledged that getting all authors to agree to the same thing is like herding cats, and therefore you can’t put all authors in a single class and claim to represent their collective best interests. There may indeed be no such thing as “collective best interests” when it comes to authors.

So what happens next for Google Book Search? The plaintiffs could move forward with the suit, but it’s a considerable gamble because if they lose, then they’ll have inadvertently expanded the definition of fair use. Personally I think that’s great for society, but it’s not necessarily so great for publishers’ business models, hence their outrage at Google.

Another possible byproduct of the death of the ASA is that Google’s competitors can move forward with their own digitization projects. They’ll be assuming the same risk of lawsuits over copyright that Google is now facing, but at least they now know that Google isn’t about to carve out a special protected arrangement that will give it an unbeatable competitive edge.

(Photo: Aviruthia)

The Kindle, he writes in a forthcoming article for Locus magazine, “wins” over print in two areas. First, it’s easier to read than a printed book if you need larger sized text, because it can make any book a large-print edition without requiring any real knowledge of how the device works; this is both a crucial feature and usability requirement for the current 40-and-over set. Second, its “buy once, read anywhere” approach makes reading big books a pleasure instead of a task. (Gaiman writes that he still prefers paperbacks for smaller, pocketable books.)

That first achievement–ease of use–sounds like common sense, but it’s actually pretty hard for companies to pull off these days, which is why you should always try out an ereader in person before you buy it. In my opinion there are only a handful of truly easy-to-use consumer electronics in the world: the iPhone, the Tivo (with the original menu, not the unusable HD interface), the Keurig brewer, the Flip videocamera, and the Kindle. Although Amazon’s web interface for the Kindle is nothing to brag about, it’s possible to avoid it almost entirely and still get full use out of your Kindle.

This simplicity really hit home for me last week, when I took advantage of Borders’ “please give us some revenue” sale and bought the Kobo Wi-Fi for $100. I bought it for my mom, because I figured even though she’d miss out on cheap Kindle books, she’d be able to access library ebooks on a Kobo. But I wanted to give it a test run first to make sure it would be easy to use. I immediately fell in love with the hardware, but I kept running into problems with the usability. First, I hated how it was pre-set to connect only to the Borders ebook store and not to the general Kobobooks.com website (actually I hated that there were two shopping destinations at all–Kobo should just be Kobo). I also didn’t like how you had to navigate down through multiple screens just to toggle wireless access, when that’s the very first menu item on the Kindle. I hated that you have to install a desktop app if you want to wirelessly sync the Kobo with your library. And then there was the Adobe Digital Editions program requirement for authorizing library check-outs.

In the end, I couldn’t bring myself to send my mother an ereader that was looking suspiciously like it would require many hours of technical support. I took it back and spent the extra $40 for a Wi-Fi Kindle. She’ll never have to connect it to her aging iBook or think of it as a PC peripheral for as long as she uses it. She can buy a new book while she’s at work, or I can email her a file, and it will appear on her Kindle automatically when she gets home. Hooray for simplicity.*

The second achievement Gaiman describes–the ability to access a book across multiple devices–isn’t unique to Kindle, and I think it’s more of a general benefit of reading ebooks, at least if you’re a Nook, Kindle, Kobo or Google eBooks customer. In fact, it’s one of the innate benefits of storing your books in the “cloud”–they’re easy to access from multiple devices, no matter where you go.

But in theory, at least, cloud storage has a heavy potential cost you should be aware of, which is that it forces consumers to give up control over their purchases.

Publishers would love to see the cloud become the only way to sell ebook licenses to readers, because they could finally get rid of unprofitable consumer behavior like passing books along to friends or shifting formats–the kinds of privileges that consumers demand when they feel like they “own” something, but that are easier to kill off when a customer grows comfortable with simply paying for access to the cloud. Cloud access also makes it easier for publishers to enforce their interpretations of fair use, and to block any applications of technology that they haven’t yet monetized.

For that reason, even though I share Gaiman’s pleasure at being able to pick up my reading where I left off as I move among devices, I always download and save backup copies of my ebooks. That way I will have at least a fighting chance of preserving access to them in the future, no matter what the publisher or retailer decides.

The bad news is, the type of consumer who takes care to make backup copies of ebook purchases probably isn’t the same one who needs an easy-to-use device, so I fear the cloud approach will win out in the years to come. The good news is that the topic is moot right now, because today all the major ereader stores let you download copies of your purchases. But as long as we still have a choice, I suggest that you patronize retailers and publishers who offer file downloads as well as cloud storage.

This isn’t just a pro-Kindle post. I would have happily bought my mom a Nook Color instead of a Kindle had it been in my budget. I wouldn’t have bought an original Nook, though, because I find its interface too clunky. (Return to the post.)

(Neil Gaiman photo: Jutta @ flickr; cloud image: akakumo)

Update: I may be getting too excited; readers over at Teleread say this was already possible, and today’s announcement just affirmed that it will remain an exemption for the next three years.

The Copyright Office is handing out a whole bunch of copyright smackdowns to big business today, with its formal announcement of a new set of classifications of works that can be stripped of copy protection.

Every three years, the Copyright Office, which is part of the Library of Congress, has to review the various types of works in the marketplace and determine whether there are any situations where it should be okay to remove digital rights management (DRM).

Today the Office announced six classes of works that are exempt from the DCMA’s rules against breaking DRM. The big one getting lots of coverage has to do with smartphones like the iPhone, because the Copyright Office has said it’s okay to (for example) jailbreak phones to take them to other carriers.

But the sixth class of exemptions is what’s fascinating for Kindle customers, and indeed all U.S. ebook customers:

(6) Literary works distributed in ebook format when all existing ebook editions of the work (including digital text editions made available by authorized entities) contain access controls that prevent the enabling either of the book’s read-aloud function or of screen readers that render the text into a specialized format.

If I’m interpreting this correctly–and as a layman, there is a high chance I’m not, so don’t use me to justify any behavior–this means: if you can’t purchase an ebook edition of a title that allows you to convert it to text to speech, then you can legally break the DRM in order to enable it.

I’m assuming this also means that if you can purchase an authorized text to speech enabled version anywhere (not just on your Kindle), then the exemption doesn’t apply.

It will be interesting to see whether this has any persuasive effect on those publishers who disabled Amazon Kindle’s text to speech functionality. Publishers (and some authors) worried that the feature would cannibalize audiobook editions, but if the alternative is that you’re opening up a legitimate excuse to crack the DRM, will they change their minds?

(Photo: subcircle)

“A settlement isn’t the right way to settle this.”

New York Law School Associate Professor James Grimmelmann, who remained a largely non-partisan outside observer (although he has stated he thinks the settlement should be approved, with modifications), pointed out that a class-action lawsuit isn’t the right way to determine an issue like fair use under copyright law. It needs to be addressed by the government and not through private negotiations, he said, because it has huge societal implications.

Grimmelmann also pointed out that if the settlement goes through, it’s likely Google will emerge with a huge market advantage over any potential competitors, which may negatively impact any healthy competition in the marketplace.

Paul Aiken, executive director of the Authors Guild and a lawyer, argued that the risk of losing the lawsuit was too great: if the courts found Google’s scanning to fall under fair use–as Grimmelman and at least one other legal expert think it could–then others would copy Google’s scanning project. “In our view,” he told the hostile crowd, “It would be catastropic.”

Grimmelman responded that the proposed settlement wasn’t the only valid solution, and that there could have been other paths to a compromise.

“The settlement is overreaching, and probably untenable.”

Lynn Chu, an attorney, author, and book agent, was the most vocal opponent of the settlement, calling it an “outrageously bad deal as a financial matter” for writers and a “typical entertainment industry scam.” At one point she implied that the Authors Guild had been misled by incompetent legal counsel, which not surprisingly seemed to anger Aiken.

Chu pointed out that the business model proposed by the settlement has nothing to do with the original lawsuit, which was solely about fair use. “You glued a business contract to a waiver,” she told Aiken, and accused the Authors Guild of appointing itself as an agent to the world’s authors.

She also criticized the proposed Book Rights Registry, which is sort of an ASCAP for authors appearing in Google Book Search, noting that it would help Google shift costs over to authors by forcing authors to take care of administrative and publishing tasks on their own dime.

“[The settlement] probably won’t survive an appeal,” she told the crowd, a sentiment that Grimmelmann seemed to agree with. Still, she cautioned, “There’s no reason to be apathetic.”

“The settlement isn’t really author-friendly at its core.”

Edward Hasbrouck of the NWU pointed out a worst-case scenario that could happen to an author under the terms of the settlement: You have a book included in the database, but your ex-publisher claims that because it has authorized a print-on-demand version of the book it still owns the rights, so you and the publisher agree to binding arbitration and you lose. Since the arbitration is legally enforceable, you will have permanently lost your claim of ownership over the digital copy in Google’s database.

Chu noted that Google reserves the right to audit the Book Rights Registry, but that the favor isn’t returned because Google claims trade secrets will be compromised. She also noted that authors can make their own deals with Google and don’t need to rely on the settlement.

Note: the Science Fiction & Fantasy Writers of America hosted an online panel discussion this morning. You can read through it at http://sfwa.org/online-google-settlement-panel/.