The agreement, which is still subject to approval from the US District Court for the Southern District of New York, will see Google paying out $125m in total, of which a minimum of $45m will go to authors and publishers whose books were digitised without their approval. Google will also pay $34.5m to establish a book rights registry, and will cover legal fees.

Authors Guild president Roy Blount Jr said the deal made "good sense". "As an author, well, we appreciate payment when people use our work," he said. "It's hard work writing a book, and even harder work getting paid for it."

The agreement follows outrage from American publishers and authors three years ago, when they learnt of agreements struck by Google with certain American universities to scan books which were still in copyright, which would then be digitised and searchable online. American authors' body the Authors Guild led the charge against the search engine, filing suit in September 2005 along with a number of authors.

Under the terms of the agreement, US readers will be able to preview up to 20% of most out-of-print books for free, with authors and rights holders of in-copyright but out of print works able to opt out of the arrangement if they choose.

For in-copyright books that are still in print, readers will be able to find the books, but will not be able to view any portion of it unless its publisher has signed up to Google's partner programme.