Google strikes deal with publishers over universal library

NEW YORK (CNNMoney) -- A seven-year battle between Google and the publishing industry is drawing to an end.

The fight is over Google's creation of a digital library that it hopes will eventually house every book ever published. Google announced the project in late 2004 and began scanning books -- with the cooperation of several major libraries -- but it skipped a step: getting a green light from the authors and publishers whose books were being scanned. Their trade groups filed a pair of lawsuits against Google in 2005.

The issue has been mired in legal battles ever since. Both the Association of American Publishers (AAP) and the Authors Guild reached a settlement deal with Google in 2009, but a judge later tossed it out.

On Thursday, AAP announced a new settlement deal with Google. The agreement is twofold: It deals with the millions of books that Google has already scanned, and also sets the rules for digitizing in the future.

Financial terms of the deal weren't disclosed, but it appears that publishers were compensated for the books that Google has already scanned. Publishers can also choose to remove books that have already been digitized.

Going forward, publishers will have to opt in and expressly strike individual deals with Google to digitize their book catalogs.

The settlement "shows that digital services can provide innovative means to discover content while still respecting the rights of copyright-holders," AAP president and CEO Tom Allen said in a written statement.

Google isn't off the hook just yet, though. It remains in litigation with the Authors Guild, which is leading a class-action lawsuit

"The publishers' private settlement, whatever its terms, does not resolve the authors' copyright infringement claims against Google," Paul Aiken, executive director of the Authors Guild, said in response to the AAP deal. "Google continues to profit from its use of millions of copyright-protected books without regard to authors' rights, and our class-action lawsuit on behalf of U.S. authors continues."

The Authors Guild's last attempt to strike a peace treaty with Google ended badly.

The organization joined in AAP's earlier settlement deal, which included a $125 million payment from Google and got a preliminary seal of approval from the court in late 2009. But the deal triggered hundreds of objections from authors -- parties to the class-action suit -- and in 2011 the presiding judge declined to give his final approval, concluding that the settlement was not "fair, adequate, and reasonable."

In particular, the judge criticized Google for its opt-out approach. The rejected deal put the burden on authors and publishers to police their works' inclusion in the archive. Google would have removed books on request, but without an explicit directive, it would otherwise have been able to digitize anything it could find.

Thursday's deal with AAP paves the way toward an opt-in model. That settlement isn't subject to court approval, but any deal Google strikes with the Authors Guild will be.

It's far from the first time that book publishers have butted heads with tech companies, which are increasingly wading into the world of content.

Last month a federal judge approved an antitrust settlement with a trio of major publishers over alleged e-book price fixing. Hachette Book Group, CBS's Simon & Schuster and News Corp.'s HarperCollins agreed to the settlement earlier this year, to resolve allegations that they had colluded with Apple to prop up the price of e-books and force Apple rival Amazon to raise its prices.