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Publishers Take Stock of the Ipod Generation Digital Publishing: Books on Paper Vs Books Online

Posted on: Tuesday, 6 December 2005, 15:00 CST

By Julia Fields, Senior Business Writer

THERE is a mantra that is oft repeated at Google headquarters in Mountain View, California; a statement that is eerily memorised and regularly disseminated to outsiders as a way to make them understand the intentions of this rapidly mushrooming internet revolutionary. "Our mission is to organise the world's information and make it accessible, " says Alexander Macgillivray, Google's senior product and intellectual property counsel.

This is the reason, he says, that Google is busily scanning the libraries of Harvard, Stanford, Oxford, the University of Michigan, and the New York Public Library. Soon to be added to the list is the US Library of Congress, which now plans to build a world digital library of books, video, photographs and other media that can be replicated digitally.

Having exhausted much of the potential of scanning and indexing the billions of items already online, Google now has a new target in sight - all the printed material that has yet to be transferred to the world wide web.

The books and documents in these library collections are already popping up on Google Book Search - those with expired copyright (called public domain) can be read in their entirety for free. More controversially, and the subject of a lawsuit by authors in the US, the search engine will also point users to snippets of books protected by copyright along with links to where they might be bought at second-hand book stores or borrowed from a library.

This new-found interest in books by what many have described as the future powerhouse of the corporate world has raised the eyebrows and pulses of traditional publishing houses and their authors in Britain.

And Google is not the only company to recognise printed books and documents as the next frontier in the battle to capture the attention of internet users. Microsoft struck a deal with the British Library last month to digitise 100,000 non-copyrighted books in its collection - its intention is to use this pilot project to lay the groundwork for future collaborations with other libraries, government departments and publishing houses.

Amazon also has plans to sell online access to chapters and entire books on a pay-per-view basis.

After years of digital books languishing in relative obscurity, suddenly the concept of people reading books online - and in some cases for free - is becoming a reality.

The prospect has plunged the publishing industry into uncertainty, with the number one question on everyone's minds: will this be a threat or opportunity? And for who?

The various schemes being planned, and their potential business models, are still so nascent that industry analysts have yet to calculate the future market value of digitised books or how they might take business away from the traditional publishing industry. The UK publishing industry sold GBP3.05 billion worth of books in domestic and international markets in 2003 (the latest figures available).

Publisher Jamie Byng, of Edinburgh-based Canongate Books, says that the answer to that question is entirely dependent on who controls the copyright. "It's certainly both an opportunity and a threat. It depends on how it is controlled and managed, " he says. "The new technologies are enabling publishers to reach their audience in all sorts of new ways;

digitising books is one of them.

"The whole idea of Amazon. com's Search Inside the Book, where you see the first eight pages or a bit of text, I don't think that's going to do any harm. If the reader comes across a book that really interests them through this, all they are going to do is go and buy the book elsewhere."

AMAZON Pages, which, starting next year, will allow customers to view and buy the pages of a book, is also being welcomed by some, as it allows the publisher to determine the fees.

Google also has a partnership scheme with "all of the major publishing houses" in the US and the UK, which gives people the ability to scroll through a number of pages of books and then directs them to places where they can be bought. The point is that these kind of services leave the control in the hands of the publishing industry - thus protecting their future interests and revenues.

But Byng and many of his colleagues are not nearly as enamoured by the separate actions of Google, which in the process of digitising library collections in the US, is scanning books still protected by copyright. Although Google is only showing short paragraphs of text around a search term from these library publications online, authors have argued that Google still needs to ask for permission to scan the books in the first place.

Google argues that it has right under a "fair use" principle in American law that allows someone to copy material as long as they use only a small portion of the work to represent it to a potential user. It maintains that many of these books are out of print and difficult to find outside a library anyway; that publishers could benefit from reprinting novels that the Google Book Search brings back into vogue. And as a last-ditch attempt to placate concerns, it said authors could opt out if they desired.

These arguments have done little to calm down those hot under the collar.

Byng says that the principle of copyright has to be protected at all costs to preserve the system that makes the production of novels possible. "When there was no copyright in the 1840s, 1850s, no-one received a penny for selling books in the US. It meant no novels were written, or very few.

That's why short stories were so popular. [Publishing in the newspapers] was the only way to make any money, " he says.

The UK Society of Authors has thrown its support behind the Authors Guild in New York, which has filed a law suit against Google, offering witness testimony if it is required.

It also sent Google a letter last week asking the internet giant to refrain from taking similar steps with libraries in the UK without the permission of authors.

But will executives at Google listen to such well-mannered pleas? "We shall see, " says Mark Le Fann, general secretary of the Society of Authors.

"They've shown a willingness to listen. They've visited us here recently."

Google's Macgillivray says that the "fair use" legal argument does not exist in European law. "We currently only have an agreement with one university [Oxford]. That agreement only covers public domain books [ie those without copyright]. We're currently deciding what else to do."

But when asked if there could be other legal arguments that could allow it to scan copyright material in the UK, he added: "There are lots of different legal arguments. But we don't have current plans to do anything."

REBECCA Jennings, a senior analyst with Forrester Research, says that the publishing industry has become deeply suspicious because internet companies such as Google have not been clear about what they want to achieve from digitising texts and books.

"Publishers want to know exactly what is going to be done with this material, " she says. "Are they ever going to charge for excerpts? How are they going to monetise this? Which booksellers are they going to put links to?"

Bill Campbell, managing director of Edinburgh-based Mainstream Publishing, agrees that more information is necessary. "We view the interest from search engines and online retailers with caution. Organisations like Google and Amazon do create great opportunities for publishers, but for selling digital content. Content should be paid for and internet providers need to develop viable pay-as-you- go models before we would sign up."

Publisher Random House, which bought a 50-per cent stake in Mainstream last spring, has decided to take control of the situation itself by investing several million pounds to digitise its entire catalogue of books.

Web providers will have to pay the company four cents a page for fiction and narrative non-fiction; access will be negotiated on an individual basis.

It's a three to five-year project and it will also include Mainstream's books.

So what exactly are the intentions of Google and the likes of Microsoft in future? Both companies maintain that the business case for entering this arena is about providing web users more reasons to choose their search engines over their rivals.

Beyond that, Macgillivray maintains that "we don't know how we're going to make money out of it".

Google retains a "small portion" of the revenues that come from putting advertisements on the book excerpts that are shown through its publishers' programme. But the majority of the advertising revenues are being given to the publishers as a way to entice them to join the project. Other than that, Google does not make any money at all.

Alistair Baker, general manager of Microsoft UK, says that while all of the material scanned in its British Library project will be available for free on MSN Book Search, the company is also exploring ways to make money from premium services - such as offering higher- quality scanned reproductions for study by specialists.

Baker maintains that "it's too early to tell" how much Microsoft could earn from its foray into digitising books. But the fact that Bill Gates flew in to meet the British Library's top officials a month ago shows that Microsoft must believe it is a future money- spinner.

The British Library deal is being used as a way to develop and test the technology infrastructure that could then also be used for other customers, such as potentially digitising government archives or publishing catalogues. "We're very much at the start of the journey, " says Baker.

"We're doing the British Library project at the moment. But we see that branching out as the world marches towards ever more digital formats."

Before that happens, however, a number of technical challenges must be overcome. Microsoft has a researcher in Cambridge sorting out the remaining glitches before the British Library content goes live sometime in 2006.

"How do you take what's available as content and provide an index to find easily what you're looking for?

How do you make the search as relevant as you can?" Baker offers as examples of problems. "Let's say you want to take a copy of the material to your computer. How do you do that and make changes impossible?

The rights challenges there are formidable."

There is also the small matter of the reluctance so far of consumers to read copious amounts of material on their computer screen. Digital forms - a very thin paper-like innovation that allows people to download information and carry it around like a book - now exist. But Forrester's Jennings says that these are a number of years away from becoming a mainstream consumer product. When they do, she believes that traditional publishers will merely have to adjust to providing more digital content.

Jennings says that publishers really have little reason to feel threatened by the current trends towards digitising.

"People are not going to sit at their computer and read a whole book. It isn't going to replace books. It's going to be used for research, browsing books, and preserving important documents, " she says.

"If anything, it will hopefully have positive effects."

NEED TO KNOW

BACKGROUND

THE world of books is rapidly changing on all fronts. Not only are internet service providers getting into digital books, but Thomas Friedman . . . author of Financial Times business book of the year The World Is Flat . . . recently suggested books be turned into an open-source product that could be constantly updated by people using the web.

Friedman has seen the audio version of his book become the top- selling podcast album on Apple's iTunes audio downloading site in November.

THE FACTS

Consolidation in book shops also promises to keep things challenging for the publishing industry.

Scottish publishers are strongly opposed to the planned takeover of Ottakar's by HMV Group, fearing it would create a dangerous duopoly. The industry will hear this week whether the Office of Fair Trading is to refer the GBP96.4 million deal to the Competition Commission NEED TO KNOW MORE?

http: //books. google. com/ searchable database of books

Source: Sunday Herald

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