I just picked this up from Lawrence Solum's Legal Theory Blog:
Hannibal Travis, Florida Atlantic University, has a new paper on SSRN: Google Book Search and Fair Use: iTunes for Authors, or Napster for Books? The abstract begins: Google plans to digitize the books from five of the world's biggest libraries into a keyword-searchable book-browsing library. Some publishers and authors allege that this constitutes a massive piracy of their copyrights in books not yet in the public domain. But I argue that Google Book Search may be a fair use for two interrelated reasons: it is unlikely to reduce the sales of printed books, and it promises to improve the marketing of books via an innovative book marketing platform featuring short previews. Books are an experience good in economic parlance, or a product that must be consumed before full information about its contents and quality becomes available. This makes new technologies that are capable of rapidly searching and previewing relevant passages from books a development that the law should encourage, not burden or restrain.
After introducing the topic, I describe Google's ambitious plan to scan and index up to 15 million library books by 2010, and provide short previews of a few lines each to help users decide whether to buy the books or check them out from a library. I then argue that the fair use limitation on exclusive rights has historically protected efforts such as Google's to address the economic problem of marketing experience goods like books, albums, movies, or games, which consumers must decide whether to buy without assessing their quality and characteristics beforehand. Fair use partially resolved this problem by permitting the unauthorized dissemination of extracts of another's work in a catalogue, review, abridgement in a periodical, or other work of criticism or commentary.
The bulk of the Article analyzes the copyright and fair use implications of lawsuits challenging Google Book Search, filed by several publishers and a putative class of up to 8,000 published authors. I contend that reproducing excerpts from scanned books for the purpose of improving access to information about books on the internet, Google is making a transformative use of the books that should qualify as a fair use....