“Google And The World Brain” is a new documentary about Google’s plan to scan all of the world’s books, which triggered an ongoing lawsuit being heard today. The hair-raising film sees Google import millions of copyrighted works, get sued, lose, but almost get a literature monopoly in the process. It’s scary, informative, and worth watching if you recognize its biased portrayal of Google as evil.

The film is getting wider release as Google continues to fight the Author’s Guild in court today. The organization is demanding $3 billion in damages from Google for scanning and reproducing copyrighted books. Google is asking the court to not prevent the group from filing a class-action suit.

“Google And The World Brain” premiered at Sundance this year, which is where I saw it, but more people finally got to see the documentary yesterday at the Vancouver DOXA festival. From the second it starts, director Ben Lewis’ opinion is clear: Google Books is as an insidious plot for data domination. See, Google didn’t just want to make a universally accessible library. It wanted to use all the knowledge to improve its search and artificial intelligence projects.

The film opens with ominous bass and a high-pitched drones that lead into historic footage of futurist and sci-fi writer H.G. Wells describing the “world brain” as a  “complete planetary memory for all mankind.” But for all its benefits, Wells also warns that the world brain could become powerful enough to displace governments and monitor everyone.

Seemingly innocent, Google approaches university libraries, including Harvard, asking to digitize their books for free. They pitch it as a way to avert disasters like the burning of Alexandria or the flooding of Tulane University’s library during Hurricane Katrina. Gorgeous shots of some of the world’s most prestigious libraries position them as infinitely valuable. Head librarians appear in interviews, giddy with intellectual excitement, and they hastily agree to Google’s offer. Soon 10 million of their books were being fed into secret Google scanning machines.

Google began showing parts of these scans online, and that’s when the backlash started. Six million of the books were under copyright and Google hadn’t attained permission to scan or reproduce them. In 2005, The Authors Guild and the Association of American Publishers filed lawsuits claiming Google was essentially stealing the books. Libraries began to turn on the search giant.

Internet scholar Jaron Lanier explains “A book is not just an extra long tweet,” and others begin to speculate that Google wants to hoard the books primarily for its own purposes, not to democratize their information. The reveal of the film’s thesis would have been more shocking and perhaps better received if it hadn’t been so blatantly foreshadowed.

After three years, the plaintiffs settle with Google for $125 million, but within the 350-page court document are shady stipulations that Google now has the exclusive right to sell scans of any out-of-print book it’s digitized — even copyrighted ones. The film labels this as a “monopoly on access to knowledge.” It asks “do we want the universal library in the hands of one company that can charge whatever they want?”

The documentary’s climax centers around New York District Court Judge Denny Chin’s choice of whether to approve the settlement or not. The director does a remarkable job of making it seem exciting by positioning the outcome as one man’s decision about the fate of all knowledge.

[Spoiler alert if you didn't read the newspapers in 2011]: Scored by a barrage of victorious brass music, Judge Chin announces that he rejects the settlement, preventing Google’s supposed “monopoly,” and all the interviewed pundits rejoice.

Google And The World Brain ends on a harrowing note, though. Even if Google can’t reproduce or sell the copyrighted works it scanned, Google Search and its artificial intelligence initiatives have already sucked up all the knowledge. As a Google engineer told author Nicholas Carr, “We’re not scanning all those books to be read by people. We’re scanning them to be read by our AI.”

The film is a bit sensationalist, and takes several detours to explore things like whether scanning books in English is an assault to classical European languages in which classic works were originally written. Still, it condenses a fascinating question about who owns information and the long battle for the answer into quite a stimulating film. You might leave feeling a little more afraid of Google than before, especially if you don’t take the more heavy-handed fear-mongering with a grain of salt. But at the very least, you’ll stand up reaffirmed that Google is destined to change humanity in ways much larger than it does today.

Article courtesy of TechCrunch

Penguin has offered, and has confirmed to us that the European Commission has accepted, a settlement with the EC over the agency pricing model for e-books — a case the stretched back to last year and involved Penguin, along with Hachette, Macmillan, HarperCollins and Simon & Schuster, as well as Apple. The other four publishers and Apple settled with the EC in September 2012. The deal will mean that Penguin can proceed with its merger with Bertlesmann’s Random House, first announced in October 2012, and approved by Brussels earlier this month, so that the two publishers can better battle Amazon.

But in making the settlement, Penguin maintained “it has done nothing wrong,” and that that its position “remains unchanged…the company continues to believe that the agency pricing model operates in the best interests of consumers and authors.”

The full statement from Penguin:

“Penguin confirms that, subject to the market test currently underway, it has reached an agreement with the European Commission to settle its investigation into the establishment of agency pricing agreements for eBooks. Penguin’s position that it has done nothing wrong remains unchanged and the company continues to believe that the agency pricing model operates in the best interests of consumers and authors. While we disagree with some elements of the Commission’s analysis, we are settling as a procedural matter to clear the decks in anticipation of our proposed merger with Random House.”

This also means that the EC’s investigation into agency model pricing will now also close. The full run-down of that case, as it has been played out with the commissioners, is here.

In essence, the publishers and Apple were being investigated over agency agreements signed between them that the EC believed prevented others (namely Amazon, but also Barnes & Noble and other online booksellers) from inking wholesale agreements with the publishers. The publishers would have looked for deals with Apple that it considered more favorable to the publishers, in light of the fact that Amazon regularly prices books at wafer-thin margins — and often at a loss — in order to drive more business overall.

The agency model lets the publishers set the price for books and offer resellers a fixed cut of that price (30% is a typical cut). The wholesale model sees publishers selling their books to distributors, who then sell them at whatever price they want. The latter is the route Amazon has used to great effect to grow its business, sacrificing margin on cheaper books for scale.

Penguin’s concessions in the settlement reached today are essentially the same as those reached by the other four publishers. According to the EC document outlining the case, they are as follows:

1. To the extent that they have not yet been terminated, Penguin will terminate the relevant agency agreements for the sale of e-books in the EEA concluded with Apple.
2. Penguin will offer each retailer other than Apple the opportunity to terminate any agency agreements concluded for the sale of e-books that: (i) restrict, limit or impede the retailer’s ability to set, alter or reduce the retail price or to offer price discounts or promotions; or (ii) contain a price MFN clause as defined in Penguin’s commitments. In case a retailer decides not to make use of the oppor­tunity to terminate such an agreement, Penguin will terminate it in line with the conditions laid down therein.
3. For a period of two years from notification of the decision to Penguin, Penguin will not restrict, limit or impede the ability of e-book retailers to set, alter or reduce retail prices for e-books and/or to offer price discounts or promotions. However, as regards agency agreements, the aggregate value of the price discounts or promotions offered by any retailer shall not exceed the aggregate amount equal to the total commissions Penguin pays to that retailer over a period of at least one year in connection with the sale of its e-books to consumers.
4. For a period of five years from notification of the decision to Penguin, Penguin will not enter into any agreement relating to the sale of e-books within the EEA that contains a price MFN clause as defined in Penguin’s commitments.

The newly formed Penguin Random House will be 53% owned by Bertlesmann and 47% owned by Pearson, Penguin’s parent.

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According to InsideSocialGames, Zynga and EA have settled their legal dispute over the former’s alleged copying of EA’s popular game “The Sims.” It was clear to many that once Zynga started teasing “The Ville,” it took some major elements from EA’s classic. A source has told TechCrunch that no money has exchanged hands as part of the settlement.

At the time of the lawsuit, companies threw barbs back and forth with EA alleging that Zynga “doesn’t understand copyright.” Details as to what the terms of the settlement are haven’t been made available, but we’ve reached out to both companies, and people familiar with the case, for more information. At one point, Zynga countersued for “anti-competitive” practices, turning this into an online gaming bloodbath of epic proportions.

Things quieted down since August, and today it appears that both lawsuits are resolved.

EA and Zynga spokespeople have issued the following statements:

EA and Zynga have resolved their respective claims and have reached a settlement of their litigation in the Northern District of California.

Here is the copy of the proposal to dimiss the case, via AllThingsD:

eavszynga

This is developing.

[Photo credit: Flickr]

Article courtesy of TechCrunch

The U.S. Federal Trade Commission just announced that its chairman Jon Leibowitz will make an announcement about the agency’s investigation of Google at 1pm ET/10am PT. Leibowitz will be joined at the press conference by Bureau of Competition Director Richard Feinstein and Deputy Director Pete Levitas, as well as Bureau of Economics Director Howard Shelansk.

The FTC has been investigating Google for alleged anticompetitive conduct for almost two years now. In November, Bloomberg reported that the FTC was putting pressure on Google to settle the antitrust talks and there were some rumors in December that the FTC was indeed ready to settle with Google before the end of 2012. While the actual investigation took a bit longer, most pundits still expect the FTC to announce a settlement with Google today. What this settlement will look like, though, remains to be seen.

It’s worth noting that Google has settled with the FTC in the past, specifically regarding its practices when it came to bypassing privacy settings in Safari.

The FTC was investigating Google’s business practices and especially allegations that the company was using its dominant position in the search space to stifle competing services. The European Commission is currently running a similar investigation.

A live broadcast of the announcement will be available here shortly.

Article courtesy of TechCrunch

Earlier this month Apple and HTC agreed to settle their legal differences by agreeing to a 10-year licensing deal. Terms of the deal were not disclosed but following the settlement, Sterne Agee analyst Shaw Wu suggested HTC could be paying Apple between $6 and $8 per handset. HTC CEO Peter Chou has now rebutted the estimate, describing it as “outrageous”, according to Reuters.

Speaking at a KDDI Corp product launch in Tokyo, Chou is reported to have said: “I think that these estimates are baseless and very, very wrong. It is a outrageous number, but I’m not going to comment anything on a specific number. I believe we have a very, very happy settlement and a good ending.”

Chou personally led the negotiations with Apple, according to HTC chairwoman Cher Wang — quoted in the FT, for a separate story denying HTC has any plans for a boardroom shakeup. The company is reportedly suing a Taiwanese magazine for defamation for suggesting there is tension among its top execs.

“Peter Chou has my total trust [and] support… There’s not any doubt about his accomplishment and ability,” Wang is quoted as saying by the FT in a statement issued by HTC.

HTC has been losing out in recent times to fellow Android OEM Samsung, which dominates the smartphone market. Last month HTC reported its Q3 financials, with revenues of $2.4 billion — a drop of almost half (48 percent) compared to the year-ago period, and down 23 percent from last quarter’s $3 billion.

Article courtesy of TechCrunch

Apple has seen sales of its iPad soar following the resolution of a trademark dispute with Chinese company Proview, which had IPAD registered years prior to the release of Apple’s iconic tablet. That’s according to new estimates from IDC analyst Dickie Chan, who said that sales of the iPad in China in Q3 were up to 2.07 million, an 80 percent increase over the previous quarter’s 1.15 million tablets sold in the region.

Chang claims Apple’s settlement with Proview, which sees the trademark change hands to Apple in exchange for $60 million, had a lot to do with iPad sales picking up speed in the region. The iPad launch in China was initially delayed as a result of the trademark dispute, and finally hit store shelves on July 20 shortly after the settlement was reached. Apple’s iPad sales in China currently lead the tablet market by a wide margin, with Lenovo as the next strongest competitor, having shipped only 278,000 tablets in Q3.

The cleared trademark hurdle helped Apple immensely in the three-month period spanning July to September, but there’s even more room to grow going into the fourth quarter. Apple still hasn’t made the latest generation iPad or iPad mini available in China, and while some reports have suggested a December release for that new device, Apple hasn’t yet specified when exactly either of the new iPad lineups will make it to that country.

Apple’s China business continues to grow, reaching $5.7 billion in sales in the company’s fiscal Q4, a 26 percent increase from the same time a year ago. Cook at the time said the iPhone 5 would launch in December, and we’ve recently heard from Chinese carriers that release is still on track. 15 percent of Apple’s overall revenues now come from China, and with iPad sales now growing in the region, that overall share could be on the way up.

Article courtesy of TechCrunch

In a press statement released late tonight, smartphone titans Apple and HTC have said that they have settled all outstanding legal disputes. The settlement includes a 10-year-licence agreement between the two. The decision is an surprising turn after HTC’s chairman reportedly declared that he had no intention of settling with Apple regarding ongoing legal battles over a number of issues, including a patent suit over the iPhone’s graphical user interface. The war left deep scars: last year, the United States International Trade Commission banned HTC phones from the US.  This story is developing and we will have more to come.

Press release from Apple:

HTC and Apple have reached a global settlement that includes the dismissal of all current lawsuits and a ten-year license agreement. The license extends to current and future patents held by both parties. The terms of the settlement are confidential.

“HTC is pleased to have resolved its dispute with Apple, so HTC can focus on innovation instead of litigation,” said Peter Chou, CEO of HTC.

“We are glad to have reached a settlement with HTC,” said Tim Cook, CEO of Apple. “We will continue to stay laser focused on product innovation.”

Article courtesy of TechCrunch

Facebook privacy settlement finalized - The U.S. Federal Trade Commission said today that Facebook finalized its settlement related to charges that it deceived users when it changed their privacy settings in 2009. The settlement requires the social network to give users notice and allow them to opt in to sharing information beyond their current privacy settings. Facebook agreed to the settlement in November, but there was a public comment period until now. Facebook will also be required to maintain a new privacy program, and have third-party audits every two years for the next 20 years.

Netflix CEO buys $1M in Facebook stock – Netflix CEO Reed Hastings, who also sits on Facebook’s board, bought 47,846 shares of the social network’s stock last week at an average price of $21.03. Presumably, Hastings believes the company is worth much more and wanted to pick up more shares while they were low. The stock hasn’t picked up very much since then, closing at $21.81 this week, still well below its $38 IPO price.

Facebook responds to click fraud allegations – In an interview with Forbes, Facebook shared some information about how it deals with click fraud, responding to allegations by one start-up that claimed 80 percent of ad clicks might come from bots. Facebook says it uses historical information and statistical models to identify which accounts may not represent real people and to evaluate click quality. It also monitors user click activity over intervals of time. If the company’s systems detect click activity it suspects is invalid, Facebook says it does not charge for those clicks. The social network apparently asked Limited Run, the company that made the allegations, for data to investigate their claim, but say Limited Run has not provided it.

Facebook employee owns ‘world’s cutest dog’ – AllThingsD discovered that Boo, the well-known “World’s Cutest Dog,” is actually owned by Facebook employee Irene Ahn. The dog, which has nearly 5 million Facebook fans, has been in the spotlight for years without its owner’s identity being revealed.

Facebook urges court to treat Likes as free speech – Facebook filed to support a deputy sheriff who was fired after Liking a Facebook page that his boss didn’t approve of. In 2009 Daniel Ray Carter, Liked the “Jim Adams for Hampton Sheriff” page, which supported his boss’ opponent. The incumbent sheriff fired Carter shortly after he won re-election. The deputy sheriff lost his case, but has appealed the decision. Facebook filed a brief that says a “Like” should be protected symbolic speech like a bumper sticker or a campaign lawn sign, which citizens use to express political opinions.

Hackathon project turns Facebook photos into postcards – Facebook has partnered with Sincerely, makers of Postagram, to allow users to turn their photos into physical postcards and mail them to friends. The “Mail A Postcard” feature was developed at as a Hackathon project and is available to a limited group of users for now.

Article courtesy of Inside Facebook

Facebook and the FTC today finalized their earlier announced settlement over charges that Facebook had “deceived” its customers by “telling them they could keep their information on Facebook private, and then repeatedly allowing it to be shared and made public.” Unlike this week’s earlier $22.5 million FTC settlement with Google, Facebook does not face any financial penalties. Instead, the company will have to promise that it will give its users “clear and prominent notice” and get their consent before sharing their information beyond their privacy settings. In addition, Facebook will have to submit itself to biennial privacy audits for the next 20 years and maintain a “comprehensive privacy program.”

The FTC launched its investigation into Facebook’s privacy practices in 2011 and the two organizations first announced that they had settled the charges last November. Today’s announcement marks the end of the public comment period and finalizes the settlement agreement.

Here are the details of the settlement. Facebook is:

• barred from making misrepresentations about the privacy or security of consumers’ personal information;
• required to obtain consumers’ affirmative express consent before enacting changes that override their privacy preferences;
• required to prevent anyone from accessing a user’s material more than 30 days after the user has deleted his or her account;
• required to establish and maintain a comprehensive privacy program designed to address privacy risks associated with the development and management of new and existing products and services, and to protect the privacy and confidentiality of consumers’ information; and
• required, within 180 days, and every two years after that for the next 20 years, to obtain independent, third-party audits certifying that it has a privacy program in place that meets or exceeds the requirements of the FTC order, and to ensure that the privacy of consumers’ information is protected.

Just like with Google’s earlier settlement, Commissioner J. Thomas Rosch dissented from the 3-1-1 decision because he questions whether “Facebook’s express denial of liability provided ‘a reason to believe’ that the settlement was ‘in the interest of the public’ and expressing concern that the final consent order may not unequivocally cover all representations made in the Facebook environment.”

You can read the full settlement order here.

Article courtesy of TechCrunch

Google today agreed to pay $22.5 million to settle a Federal Trade Commission (FTC) charge that it bypassed Safari’s privacy settings to serve targeted ads to consumers. Google placed these cookies on Safari users’ computers, despite the fact that, as the FTC notes, “Google had previously told these users they would automatically be opted out of such tracking, as a result of the default settings of the Safari browser used in Macs, iPhones and iPads.” This, according to the FTC, was in direct violation of the earlier privacy settlement between Google and the FTC.

The FTC’s charge focused on the fact that Google exploited a loophole in Safari to place cookies on its users’ computers even though Safari, by default, blocks cookies from third-party sites. As the WSJ reported earlier this year, Safari makes an exception for cookies from sites that users interacted with before by, for example, filling out a form. To place its ad tracking cookies, Google tricked Safari into believing that users were submitting a form to Google and the browser would then allow Google to install its temporary ad tracking cookies.

The existence of today’s fine was first reported last week, but wasn’t official until today. Given that this is a settlement, it’s important to note that today’s “consent order is for settlement purposes only and does not constitute an admission by the defendant that the law has been violated.”

Despite these legal details, the FTC is clearly looking at this settlement as a success. “The record setting penalty in this matter sends a clear message to all companies under an FTC privacy order,” said Jon Leibowitz, Chairman of the FTC. “No matter how big or small, all companies must abide by FTC orders against them and keep their privacy promises to consumers, or they will end up paying many times what it would have cost to comply in the first place.” One could easily argue, though, that paying a $22.5 million fee isn’t exactly a problem for Google, which had an operating income of over $3 billion last quarter.

Google’s Response

We asked Google for a statement regarding today’s announcement. Here is Google’s response:

We set the highest standards of privacy and security for our users. The FTC is focused on a 2009 help center page published more than two years before our consent decree, and a year before Apple changed its cookie-handling policy. We have now changed that page and taken steps to remove the ad cookies, which collected no personal information, from Apple’s browsers.

Google has until February 15, 2014 to expire all of the cookies involved in today’s settlement.

Article courtesy of TechCrunch