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The proposed settlement in the class action lawsuit over Google Books has proven to be quite controversial. Amazon, the American Civil Liberties Union and the Electronic Frontier Foundation are among those questioning the proposed settlement. On the other side, Sony, the Computer & Communication Industry Association and the Authors Guild are among those supporting the settlement.

Opponents claim that the settlement will give Google a virtual monopoly over online books. Supporters claim that the settlement will benefit consumers and does not preclude others from competing in the market.

Needless to say, opposition and support is based primarily on self-interest. Those who see the settlement as a threat to their businesses or ideological positions oppose it; those who believe they can benefit support it.

On Tuesday, Microsoft filed a brief with the court overseeing the settlement voicing its concerns. Given that the perceived rivalry between Microsoft and Google is only growing, it's no surprise that Microsoft has come out firing live ammunition. In its brief, Microsoft claims that the Google Books settlement isn't even a settlement. According to Microsoft, it is a joint venture borne of an "illegitimate approach":

The final settlement is a complex license, involving a worldwide class of millions of copyright owners, and resembles a joint venture among publishers, authors, Google and the libraries that provide books to Google for scanning.

Microsoft argues that the settlement goes way beyond the dispute at the heart of the class action lawsuit against Google and that it instead "confers on Google a new monopoly by authorizing Google (and Google alone) to engage in the wholesale commercial exploitation of entire copyrighted books."

In its brief, Microsoft's lawyers argue that the settlement is no less than a violation of the court's judicial powers:

The purpose of class action is to resolve a legal dispute, not launch a “joint venture.” Google and the three authors and five publishers who filed these actions ask the Court to conscript the vast majority of the world’s copyright owners in books into this “joint venture” that would create a monopoly in digital books. The proposed settlement is unrelated to the narrow legal dispute before the Court and, if approved, would constitute an unprecedented misuse of the judicial system. It invades the exclusive power over copyright that Article I of the Constitution grants to Congress and exceeds the Court’s authority under Rule 23 and Article III of the Constitution.

Microsoft critics, of course, suggest that Microsoft is simply trying to stop an increasingly powerful foe that threatens its position in the marketplace. In other words, they suggest that Microsoft is jealous.

They are probably right. But that doesn't mean that Microsoft isn't right about the Google Books settlement. Those interested in a competitive marketplace for books online do have reason to express concern. And it is disturbing that the courts seem to be going way beyond resolving a class action lawsuit.

Those who dismiss criticisms of the settlement just because some of them come from Google competitors that are in business to make a profit do so at their own peril. The widespread concerns over the proposed settlement exist for a very good reason: Google is about to be handed an almost unbelievable amount of power through what appears to be legislation. Even though the United States Congress isn't involved.

Consumers rarely benefit when a single company 'owns' a market. That said, some companies are so successful that they do come to dominate a market. If Google wants to dominate online books the way it dominates search, that's fine. But it should have to earn that dominance the hard way: by winning out in the marketplace.

Photo credit: Jim Barter via Flickr.

Patricio Robles

Published 10 September, 2009 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

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