Google and a number of agencies representing book publishers agreed to a revised settlement covering Google Books on Friday, limiting the international scope of the agreement and providing a sort of trust fund for "orphaned" works.

Google and a number of agencies representing book publishers agreed to a revised settlement covering Google Books on Friday, limiting the international scope of the agreement and providing a sort of trust fund for "orphaned" works.

On Monday, Judge Denny Chin approved a delay in the agreement until Friday. The parties barely met their deadline, circulating the agreement to reporters shortly after midnight on Friday and holding a conference call shortly thereafter.

"This is not about claiming the future about digital publishing; this is about claiming the past," Richard Sarnoff, co-chairman of Bertelsmann Inc., president of Bertelsmann Digital Media Investments, and chairman of the Association of American Publishers said on the call. "So we're adjusting, we're scaling back the Internet scope of the settlement."

The revised agreement calls for the Google Books program to cover the U.S., the U.K., Australia, and Canada, excluding Germany and France. Google explained that the revised agreement will now cover countries with "a common legal heritage and similar book industry practices".

Rightsholders who published their book or filed for a copyright by Jan. 5, 2009 are eligible to be covered under the revised agreement.

Now that the revised agreement has been submitted to the court, Google said it expects the court to set a timeline for notice and objection period, and then a final fairness hearing in 2010.

In September, the Department of Justice urged the court to reject the search engine giant's $125 million class-action settlement in its current form. The agency said it was worried that Google had no financial incentive to track down rights holders for its book repository and questioned whether the court was the proper venue to settle the matter. Executives said Friday night that the DOJ's concerns were factored into the settlement.

The debate dates back to 2004, when Google partnered with major university libraries to scan their collections and make them available on the Internet. The Association of American Publishers (AAP) and the Authors Guild sued Google for copyright infringement in 2005. In October 2008, the two sides announced a $125 million agreement that would create a registry of online books, and allow U.S. consumers and institutions to purchase access to that material.

The original agreement also created a Books Rights Registry that will search out rights holders for so-called orphaned works. Under the revised agreement, after five years funds collected for the rights holder will no longer benefit the Registry itself, or other rights holders. After ten years, the Registry may donate the funds to governments or public charities that benefit the reading public. A court-appointed fiduciary will represent those rights holders.

Works covered under the Books Rights Registry will generally fall into one of three categories, Sarnoff said. Those categories include out-of-print works, unclaimed out-of-print works, and truly "orphaned" works, whos authorship it not even known.

"Data analysis shows that the actual number of orphans is small," Dan Clancy, Google Books' engineering director said during the call.

As per the original agreement, the agreement provides for a number of public terminals to be placed in U.S. universities and libraries, too allow free access to electronic versions of published works. Users will have the option of print-on-demand, file download and consumer subscriptions.

Google is also explicitly required to allow its competitors, local bookstores, and other retailers to sell access to the covered out-of-print works. Rightsholders will keep 63 percent of the revenue, with retailers keeping the other 37 percent.

Judge Chin had delayed a meeting between the two sides after the parties asked for extra time in order to address the DOJ's concerns. The judge then set a deadline of Nov. 9.

The Authors Guild, meanwhile, had filed a statement on its Web site praising the settlement before it was even delivered.

"We're confident they'll all find even more reasons to cheer the amended settlement," the Guild said, referring to supportive editorials by major publications. "We're holding to our core principles: lots of access to out-of-print books for readers, students and scholars; compensation and control for authors and publishers."

The Open Books Alliance took an unfavorable view of the settlement, however. "Our initial review of the new proposal tells us that Google and its partners are performing a sleight of hand; fundamentally, this settlement remains a set-piece designed to serve the private commercial interests of Google and its partners," co-chair Peter Brantley said in a statement. "None of the proposed changes appear to address the fundamental flaws illuminated by the Department of Justice and other critics that impact public interest."