Why the Google Books Settlement is Procompetitive

Abstract:     
Although the Google Books Settlement has been criticized as anticompetitive, I conclude that this critique is mistaken. For out-of copyright books, the settlement procompetitively expands output by clarifying which books are in the public domain and making them digitally available for free. For claimed in-copyright books, the settlement procompetitively expands output by clarifying who holds their rights, making them digitally searchable, allowing individual digital display and sales at competitive prices each rightsholder can set, and creating a new subscription product that provides digital access to a near-universal library at free or competitive rates. For unclaimed incopyright books, the settlement procompetitively expands output by helping to identify rightsholders and making their books saleable at competitive rates when they cannot be found. The settlement does not raise rival barriers to offering any of these books, but to the contrary lowers them. The output expansion is particularly dramatic for out-of-print books, for which there is currently no new output at all.

Keywords: Google, books, Google Books, Google Books Settlement, copyright, digital books, cartel, monopoly, monopolization, orphan books, out-of-copyright, out-of-print, entry barriers, restraints of trade, Internet, antitrust

JEL Classifications: K21, L12, L4, L41, L42, L49

Working Paper Series