German chancellor Angela Merkel yesterday waded into the row over Google's plans to build a massive digital library.

The move was a remarkable intervention from a leading world politician in a growing dispute about the threat posed by the internet, and Google in particular, to publishing companies, authors and also newspapers.

In her weekly video podcast, before the opening of the Frankfurt Book Fair this week, Merkel appealed for more international co-operation on copyright protection and said her government opposed Google's drive to create online libraries full of scanned books.

"The German government has a clear position: copyrights have to be protected on the internet," Merkel said, adding that there were "considerable dangers" for copyright protection online.

Merkel, who will officially open the world's largest book fair in Germany's financial capital on Tuesday, said there was a need to discuss the issue in greater detail. She was reacting to Google's astonishing project to eventually make virtually all the books in the world available to be searched online. Though it sounds almost like science fiction, Google workers have been scouring the world's libraries and scanning the books therein. They then upload the images onto the internet and make them searchable using Google.

To date it is believed that Google has scanned more than 10 million titles from libraries in America and Europe – including half a million volumes held by Oxford's Bodleian library. The exact method it uses is unclear; the company does not allow outsiders to observe the process. However, despite the secrecy surrounding the project, Google says its aims are entirely altruistic. Its founders, Sergey Brin and Larry Page, have frequently said that their company's ultimate mission is to make available all the world's information online. However, despite such seemingly poetic aims, the project has many critics, including those who say it could put publishers out of business, as it risks putting books for free onto the internet. Authors and other holders of copyright on titles also worry that it will infringe their rights and harm their ability to profit from their work.

The issue is already before the courts in America. In New York, a judge said last week that changes to a settlement that would allow Google to put millions more books online should be presented in court by 9 November. The move is an effort to resolve a 2005 lawsuit brought by the Authors Guild and others against Google's effort to scan libraries full of books.

Under the terms of the original settlement, Google would pay $125m (£78m) to create a book rights registry. Authors and publishers could register works and be paid for books and other publications that the search giant would put online. But German book publishers have criticised European regulators for failing to oppose the settlement. Meanwhile, last month French publishing house La Martinière, the French Publishers' Association and authors' group SGDL asked a Paris court to fine Google €15m (£14m) and €100,000 for each day it continued "to violate copyright" by digitising their books.

Brin, however, says the plan would make millions of out-of-print books available online and thus would not cannibalise existing sales, as those books were not readily available to buyers. Google argues that it is increasing access to works that would otherwise never see the light of the day.

Nor is the books issue the only area where Google's quest to make all information readily accessible on the internet is causing a stir. The newspaper industry argues that Google, and other websites, are profiting from its hard work by acting as aggregators of news stories while not actually producing any content themselves. The argument has turned increasingly bitter in recent months as the crisis in the global newspaper industry has deepened amid widespread lay-offs of journalists and the closure of some titles. Last week Rupert Murdoch, head of News Corporation, made an especially fiery speech hitting out at companies such as Google and effectively calling them thieves who profited from stolen content. "The aggregators and plagiarists will soon have to pay a price for the co-opting of our content," he told the World Media Summit in Beijing.