Controversial plans by Google to digitise millions of out-of-print books to create the world’s biggest online library have been approved by British publishing groups and authors.

The landmark deal between Google and authors’ associations in America is a watered-down version of the original plans. The new deal will still enable tens of thousands of British writers to profit, as readers can search millions of works, read extracts online and buy full copies.

Works from the US, Britain, Canada and Australia will be used, but under the proposals about 95 per cent of non-US books from the original deal will not be covered. Although the service will be available only in the US, Google said that it would expand to other countries including Britain. The company said that it had already copied ten million books, seven million of which were out of print. It could not say which ones yet because of legal reasons.

It emerged last week that Google had amended a multimillion-dollar settlement made with the Authors Guild in America last year. That deal would have given the internet company the right to scan any published works in the world as part of the book search service. American internet users would then access the books online. Proceeds from any sales would be split between Google, the publishers and authors. The agreement, worth $125 million (£75 million), would have automatically included all books, even those not published in the US, unless objections were raised.

But the settlement was criticised around the world, especially in Europe and Asia, with governments and publishers claiming that the move would have infringed the copyright of many international authors.

Complaints were also raised by the US Department of Justice, forcing Google to revise the settlement.

Yesterday executives from the the Publishers Association and the Authors’ Licensing and Collecting Society (ALCS), the trade groups that represent the majority of British authors, welcomed the deal. “Undeniably, there’s an element of pragmatism at work here,” said Simon Juden, chief executive of the Publishers Association. “You can argue as to whether this should exist or not. But given that it does, we think that it is the best course to take.”

The ALCS said that more than 20,000 British authors, whose books formed part of the service, could profit. Authors will receive a lump sum of at least $60 for allowing digital copies of their books to be made. They will then receive the majority of proceeds from any online sales via Google Books and also get about two thirds from other online book sales. Google will take the rest.

Rights holders will be able to set the price for the book on the service, but if they do not, Google said that it will use a “pricing algorithm” to calculate the cost of the book. The ALCS said that the move will provide “an important source of revenue” for out-of-print authors.

The publishing industry in Britain is worth £1.8 billion, with about 270 million books being sold in 2008.

A spokesman for the Society of Authors in Britain said: “Although far from perfect, the scheme does provide a way of giving a wider access to books.”

However, not all publishers have welcomed the development. “We should be extremely cautious about ceding rights to any organisation in this sort of default manner,” said Anthony Cheetham, director of Atlantic Books, which published the Booker Prize-winning The White Tiger by Aravind Adiga.

“It is generally felt that if somebody wants to reproduce they have to seek the owner’s permission, not that they can use it and then say ‘we didn’t ask you but we’ll give you a proportion of the takings’. Somebody said that it was a bit like the burglar coming in and taking all your possessions and calling you afterwards and saying that he was selling them on.”

Although Google is continuing to scan more books it is unlikely that the service will be able to launch soon. Powerful IT and online publishing groups remain opposed to the plans, and experts said that the settlement was still likely to be wrapped up in legal issues in American courts for some time.

Last week Peter Brantley, co-chairman of the Open Book Alliance, a group that includes Microsoft and Amazon, said: “Our initial review of the new proposal tells us that Google and its partners are performing a sleight of hand.”

The Publishers Association said that it was working on a European project to introduce a similar, independent service within the next 18 months.

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