Antitrust and Innovation: Framing Baselines in the Google Book Search Settlement

Intellectual Property, Competition Policy and Antitrust and Copyright and Trademark

Article Snapshot


Randal Picker


GCP: The Antitrust Chronicle, Vol. #493, November 4, 2009


This paper looks at antitrust issues raised in the copyright suit brought by book publishers against Google.

Policy Relevance

Policymakers and courts should feel free to require changes to the Google Book Search settlement that would further competition, unless the changes would be likely to lead to the failure of the Google Books Search project.

Main Points

  • The proposed settlement between the authors and publishers who sued Google for copyright infringements related to Google Book Search raises difficult antitrust issues, including:
    •  Joint price setting for books bought by individual consumers through Book Search.
    • The “orphan works” provisions, concerning the use of work that cannot be used because it is not clear who owns the copyrights or the owner cannot be found, which allow the works to be distributed widely by Google.

  • In assessing competition issues with newly innovative products, an increase in output does not mean that it makes sense to approve controversial business behavior such as price fixing.
    •  An example is price-fixing by makers of VCRs, who argued that because market for price-fixed VCRs was an improvement for consumers compared to the market without any VCRs, that price fixing should be allowed.
  • In assessing the merits of the Google Book Search Settlement, one should compare the prospects for consumers in a world with an improved settlement, to their prospects in a world with the unimproved, original settlement.
    • It would only make sense to say that the joint price setting for books should be allowed because it is part of a settlement that includes benefits, if Google Book Search was likely to fail without the joint price setting. 

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