Cairns, Michael. A Database of Riches: Measuring the Options for Google’s Book Settlement Roll Out s.l.:Information Media Partners, 22 April 2010. (http://www.scribd.com/full/30334705?access_key=key-23rh5w2lwcdmcmzph2k4).
Everyone is eagerly anticipating a decision on whether the court will accept the proposed amended settlement of the suit brought by some authors and publishers against Google’s library program. The recent confirmation of Judge Chin to the Court of Appeals may indicate that we will have to wait longer (though there is at least some speculation that he might seek permission to address this one last case).
In the absence of a decision, we can only guess what the final GBS database might look like. In this new report, Michael Cairns, a former president of R.R. Bowker, a publishing consultant, and the author of an earlier study on how many orphan works there might be in the database, has turned his attention to the business models Google might adopt. It is the first public analysis of which I am aware that attempts to determine how much an institutional subscription might cost.
One can quibble with some of Cairn’s assumptions about the price of an average subscription or whether the level of market penetration he predicts would satisfy the settlement’s requirement of “the realization of broad access to the Books by the public, including institutions of higher education.”
What surprised me the most was the the substantial amount of money that could be generated for the rights holders from these out-of-print titles. Even at a relatively low subscription price and with modest market penetration, Cairns estimates that the database could generate $260 million a year, 70% of which, or $182 million, would go to the rights holders. It is not enough to come close to justifying Google’s investment in the project, but for authors and publishers, it represents an enormous pot of “found money.” The analysis also demonstrates that low subscription prices and broad market penetration may be more profitable than the normal library model of high subscription price and limited market penetration.