Google's Schmidt and Brin on Books, Culture and Evil-ness

In a wide-ranging, 90-minute news conference Wednesday, Google Chief Executive Eric Schmidt and co-founder Sergey Brin discussed the economy, the company's recent announcement with Verizon Wireless, the books settlement, Gmail outages and its merger and acquisitions outlook.

1) On paid content models online: Schmidt said, "There is clearly a market for free content, and that market is the size of the Internet. There is clearly a market for subscription content- — meaning per-view or per-month payments — and it's clear there are also going to be very expensive negotiated transactions for high-value content." He said it is similar to broadcast television, cable television and pay-per-view. "The size of those markets are correspondingly different. So when we argue over this, we're not arguing about the principle. We're arguing over the size of the market." "We are working on payment systems and subscription models to enable those other tiers," Schmidt added. Content owners will not set the price. "Everyone is familiar with this problem in selling your house. We're not going to use the price you suggest," he said.

2) On Google's plans to buy one company a month: Schmidt said, "That was our historic average...I think it's going to be small companies of five to 10 people. Half of the most interesting things at Google came from small companies. When Larry and Sergey bought Android I didn't even notice. Sergey was surfing on the Web one day and came across what became Google Earth. He came in my office and said 'I bought them.' I said, 'For what price?' It was a small number so I said OK."

3) On the problem of "orphan works" in the Google books settlement: On Tuesday, Google said it would submit an amended books settlement in November. One of the criticisms of the settlement has been that it gives Google license to orphan works, whose rights-holders are unknown. "Some of the criticisms are legitimate and can be addressed by changes in the settlement. Some other criticisms are by people who don't want a change," Schmidt said. "The scenario in front of us is not perfect. But the perfect is the enemy of the good...my challenge to the critics is, make an alternative proposal that solves the problem that consumers do not have access to books that they cannot read today." "The companies that are making these objections have done nothing for orphan works," Brin added. "Nobody was interested in these works at all, and there is no existing market for them. So I think these objections that Google will be the only one are pretty ludicrous given that no one else has done this." He said that he has written an opinion piece on the topic that he hopes will be published soon.