Ken Auletta - Googled - The End of the World as We Know It

Not surprisingly, this depiction jarred Googlers. When Sheryl Sandberg joined the company in late 2001, she believed she had a public mission, a mission parallel to the one she felt as a ranking member of the Clinton administration. Yet to her shock, not long after the IPO, she first heard Google referred to as the “evil empire.” She was attending a Google conference-“I was standing there with our partners and they said, ‘How do we sustain ourselves against the power of-’ I thought they were going to say Microsoft. Instead they said, ‘Google.’”

The hostility, said Eric Schmidt, “did not begin until Google went public and people realized how much money we were making.” The reaction had more to do with fear than envy. It took Microsoft fifteen years to exceed one billion dollars in revenues; it took Google just six years. The evidence was now visible that Google was attracting more Internet advertising than anyone else, and these dollars were being siphoned from traditional media. This was perceived as a threat to most traditional media companies, and perhaps none more so than the advertising industry. Google was able to sell advertising with just a few search words, and without charging the same 2 to 5 percent fee extracted by the media buying agencies. The buy was better targeted. And for advertisers it was more efficient, for Google only charged the advertiser when the consumer actually clicked on an ad. “There’s that same ‘think big’ attitude about markets and opportunities,” Steven I. Lurie, a former Microsoft executive who had friends at Google, told the New York Times at the time of the IPO. “Maybe you can call it arrogance, but there’s that same sense that they can do anything and get into any area and dominate.”

IT WAS IN THE CONTEXT of this growing backlash that the fight with book publishers, begun a few years earlier, started to come to a head. Like the Googlezon film, the uproar over digitizing books seemed to surprise Googlers. In their assessment, by scanning books and making them part of search, they were performing an ambitious and noble public service-they thought of the effort as their “moon shot”-and they assumed that they could do this without seeking permission of the copyright holders. Google knew that only about a third of the more than twenty million books ever published were no longer protected by copyright. But the mission was to scan all books. With books under copyright, Google said it would merely show “snippets,” which it claimed was permissible under the fair use clause of copyright law. Google did not precisely define the maximum number of words in a “snippet.” Nor does the law, but the rule of thumb is that fair use involves only enough text to briefly explain a book or briefly quote from an article or song.

Google believed it had provided protection to authors and publishers. In its contracts with libraries, Google said that if, within three years of the digital transfer of material, “Google decides not to use that content” (a particular book) because of a copyright dispute, the library would destroy the digital copy. They believed authors and publishers would see Google Books as a wonderful way to promote authors and their works, and to bring back books no longer in print. Google had earlier launched a Partners Program, signing up publishers who agreed to allow snippets to be shown for certain books, along with a link to an online bookseller. But publishers did not agree to allow all books to become part of search. The gulf between Google and the publishers and authors was vast. Google wanted to push the envelope of copyright, expanding the definition of fair use to allow more extensive quotations from books. It stressed the rights of search users, echoing the views of Web pioneers like Kevin Kelly, the “senior maverick” at Wired magazine, who said that in return for government copyright protection, authors and publishers had a “copyduty” to “allow that work to be searched.” Google was offering to pay the cost of moving and scanning the books; what publisher-or library or university or author-could refuse that offer?

One clue of Google’s fundamental attitude toward books-and fundamental innocence of the publishing process-is a conversation I had with Brin while reporting this book. It was the second of our three interviews and upon entering the small conference room down the hall from the second floor glassed office he shares with Page, Brin playfully ribbed me for writing this book. “People don’t buy books,” he said. “You might as well put it online.” He meant: You might as well publish it for free.

“You might make more money if you put it online,” he said. “More people will read it and get excited about it.”

There’s little evidence that such a free book succeeds, I said. Stephen King tried it, and gave up the effort because he thought it was doomed.

“I guess that’s true,” he acknowledged a little sheepishly.

Following Google’s business model, would he expect authors to generate their income by selling advertising in their books? If there was no advance from a publisher, who would pay to cover the writer’s travel expenses? (I made thirteen week-long roundtrips to Google from New York, rented a car, stayed at hotels, and paid for dinner interviews most nights.) With no publisher, who would edit and then copyedit the book, and how would they get paid for their work? Who would pay lawyers to vet it? Who would hire people to market the book so that all those potential online readers could discover it? The usually voluble Brin grew quiet, ready to change the subject.

But our rhetorical go-round hinted at something fundamentally true about Brin and Page and the dynamic company they have forged. Their starting predicate is that the old ways of traditional media are usually inefficient, and scream to be changed. This is a reason Google fundamentally misread the reaction of publishers and authors. While Google did reach various agreements with a variety of libraries, including Harvard, Stanford, the University of Michigan, Oxford University, the Library of Congress, and the New York Public Library, publishers did not like the idea of not getting paid for the use of their books. The Association of American Publishers denounced Google’s plan as an invitation to piracy, for the books stored on servers would be vulnerable to hackers. Publishers claimed they could be hit by the same thunderbolt that struck the music industry: free downloads.

Richard Sarnoff, the chairman of the Association of American Publishers and the executive vice president of Random House, said, “Google went to libraries and said we will digitize all your books and just use snippets of copyrighted books. They said it would be good for libraries and for users. This is true. But we have laws in this country which govern what we can do and not do. Like copyright, which prevents people from copying things for their own commercial use. And this is for Google’s commercial use, for search.” The publishers demanded that Google seek their permission before digitizing any book that was still protected by copyright. “The Internet is a grazing medium,” Sarnoff said. “Books tend to be a longer term experience.” Grazing can be a great way to promote a book, he said. “But we want to be extremely careful to make sure discovery does not become consumption.” To illustrate his fear of piracy, he pulled out his iPhone and said that the small device can hold fifty thousand books, all easily down-loadable. This, he noted, is the approximate capacity of a midsize bookstore. In October 2005, the publishers announced that they had filed a lawsuit.

Paul Aiken, the executive director of the Authors Guild, wanted authors to share in any profits from their books, but said his primary concern was piracy. He mentioned “the huge risk” posed by backup copies in Google’s possession and the libraries. “Google is giving back to the University of Michigan a digital copy of each book for their own use. What happens to the University of Michigan copy?” What happens, he said, when they share the copy with other Michigan libraries? What happens “if they lose the backup?” Or it’s hacked into? Sarnoff was also concerned that Google’s definition of “a snippet” was vague. A longer snippet from a novel is likely too brief to rob the book of value, he said. But a snippet of a reference book may be “taking real value” from the author. In a fundamental sense, the differences between Google and its Silicon Valley allies, who want to share information, and publishers and authors, who want to be compensated for it, boil down to a definition of property rights. On the Internet, it is common to make copies of pages and share the information of those who produce content. In traditional media, such “sharing” is often considered theft. The Authors Guild also filed a lawsuit against Google.