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From Smart Bitches, Trashy Books:
As we continue to stay home as much as possible, even the most die-hard “give me paper or give me death” readers have been dipping their toe into the ebook waters. And they’re discovering what long-time users have known forever.
Good news! You can get ebooks from your library!
But (bad news) only if you’re willing to wait for-EVER for the most popular titles.
Even for some of the less popular titles, wait times are much longer for ebooks than their print versions, and it’s just gotten worse as ebook popularity has dramatically increased this spring and summer.
Which leads to the following questions:
Why do you have to wait for an ebook at all?!
Why doesn’t my library just buy more copies?!
And the conclusion I’ve come to for both questions is: I think most publishers hate libraries.
I wish I were kidding.
When libraries and publishers entered the ebook landscape, they went with a model they knew and understood: they licensed library ebooks with a one copy/one user. While some other models have come out since then (such as cost-per-circ, where the library pays every time someone checks a book out, which you see with services like Hoopla) one copy/one user remains the most common way ebooks are sold for lending. However many licenses a library buys is how many people can read a book at a time.
So why doesn’t the library just buy more copies?
Because ebooks for libraries are really, really, really expensive.
And then we don’t even get to keep them. Librarians pay wholesale for print books that can remain in circulation for literal decades, but ebooks are very different in terms of access and in terms of cost.
. . . .
So I started a project where every week I shared what was on the best seller list and how much those books cost. I shared specifically how much the library would spend to buy those titles in a paper book or an ebook and how much those same books (paper and ebook) would cost for a regular person.
. . . .
First, let’s look at averages for print, digital book, and digital audio.
On average, the Suggested Retail Price for a print book (aka the price that’s printed on the cover) was $24.78.
On average again, Amazon would sell you (a reading consumer) a paper copy of that print book for $16.77.
Your library could buy a print copy from their vendors for $14.14.
Looking for digital?
You could buy that same book on average for $12.77 on your Kindle.
The library had to pay an average of $45.75.
YES WE HAD TO PAY THAT MUCH. 3.5 TIMES MORE THAN YOU DID.
On average, this means that we (libraries) can buy 3 print copies for every single ebook license, and still have some money left over.
$14.14 + $14.14 + $14.14 = $42.42 for 3 print books in circulation
$45.75 for a single license of an ebook.
And then there’s audio.
If you’re curious, the average price to buy the book on Audible was $27.28, but for libraries to get it in digital audio? $69.76.
. . . .
Of the popular titles included in this dataset:
- 44.3% of digital library books were between $50.00 and $59.99.
- 19.4% of digital library books were between $60.00 and $69.99.
- 18.2% of digital library books were between $20.00 and $29.99.
In other words:
64% of ebooks cost over $50 for libraries, but none of the titles included in this data set are that much for anyone else.
99% of Kindle books cost $19.99 or less, but only about 13% of library ebooks do.
. . . .
Pour yourself another drink, because it gets worse when the usable lifespan of these purchases is examined against the price per item.
. . . .
86% of the ebooks from that list have to be repurchased on a regular basis, most commonly after 24 months, even if the book is never checked out.
This is why libraries can be reluctant to take an ebook chance on an unknown author.
When libraries buy the ebook, the terms of purchase are actually a lease. The publisher will take the book back after 24 months. If libraries want to still have that ebook available for checkout, they need to buy it again.
Publishers do this because, once again, they’re working off the print model, and print books don’t last forever. They get eaten by the dog or dropped in the tub or coffee gets spilled on them or after it’s been checked out a million times, it just wears out. And if people still want it, we’ll buy another copy.
But…(and this is a big but)
Remember how much libraries pay for print? ($14.14 on average, see above?)
How they pay even less than the average Amazon price?
The average price of an ebook that has to be repurchased is $49.48.
Wait, isn’t that higher than the average price of library ebooks?
YES IT IS.
The more expensive a book is, the more likely we have to rebuy it on a regular basis.
Only 1% of the books that cost over $50 don’t have to be regularly repurchased.
I know it doesn’t make sense.
Prices and terms for digital books are set by the publisher, and most publishers have broad rules that apply to all of their books.
And some very large publishers *cough* Penguin Random House, Macmillan, and Hachette *cough* have set high prices for books that expire quickly.
Why would they do this? Because they can. If libraries want to provide what our users want, we’ll pay their prices on their terms, no matter how ludicrous, because what choice do we have?
. . . .
Some publishers refuse to sell digital formats to libraries.
Major side-eye to every single Amazon imprint and company, which includes Lake Union, Audible, and more. All of those wonderful Audible exclusive audio books? Are Audible exclusive, which means libraries cannot acquire them.
Some self-published authors don’t make their stuff available on OverDrive, and if they’re part of Kindle Unlimited, they’re not allowed to.
How big of a problem is this?
Libraries were unable to buy 1.5% of this year’s bestsellers in ebook.
It’s worse for audio–libraries were unable to buy 15% of this year’s bestsellers in eaudio.
. . . .
If libraries have to pay that much money for an ebook and can only keep it for 24 months, they’re going to concentrate purchasing power on titles they know will circulate heavily, to get the most bang for the limited buck. Which means lots of blockbuster sure-bets, and less midlist or new authors.
For romance readers, fans of Avon and Harlequin are in luck, because they’re both HarperCollins imprints. HarperCollins charges Suggested Retail Price and libraries can keep the ebook for 26 checkouts. As with most romance publishers in mass market paperback, most of their ebook titles are $7.99 and libraries can keep them until they use up all 26 checkouts. While it’s still not as good as print (which libraries would pay less money for and which usually last far longer than 26 checkouts) it’s still the best pricing offered by any of the major traditional publishers.
But St. Martins is Macmillan, and Macmillan charges $60 for new ebooks (regardless of Suggested Retail Price) and their ebooks expire after 24 months, even if no one checked it out. Berkley is Penguin Random House, and they charge $55 for new ebooks that libraries can only keep for 24 months.
That can be really hard math to justify! With our vendor discount, libraries usually pay $4.95 for a mass market paperback with a Suggested Retail Price of $7.99, so they can buy a full dozen print copies for the same price of a single ebook (and that ebook expires after 24 months)
Link to the rest at Smart Bitches, Trashy Books and thanks to DM for the tip.
PG will note that the digital vendor his library uses is perfectly capable of proving any publisher with anonymized data reporting how many people checked out an ebook, how many people returned the ebook without reading it, how many people read part of the ebook (and how many pages they read) but returned the ebook without finishing it and how many people read the entire ebook.
PG is disappointed that Amazon won’t provide a simple path for indie authors to make their ebooks available to libraries at a price set by the author. Just like perma-free, ebooks in libraries can be a superb way for readers to discover new authors and books, helping authors and Amazon sell more.
PG will note that the digital vendor his library uses sends him to Amazon to download a library ebook which, on the book’s regular Amazon product page where the Add to Cart button is replaced by a Borrow button which he clicks to send the ebook to his selected reading device. So it would appear that much, if not most, of the plumbing is in place for indie authors to make their ebooks available to libraries.
Visitors to TPV can feel free to harass KDP and anyone else at Amazon to urge them to allow library purchase of KDP ebooks for lending by the libraries. Amazon could even require a minimum license price for library loans of indie ebooks if it felt library borrowing would eat into Amazon’s revenue stream from ebooks in some way.
If PG were in command of Amazon’s indie library sales initiative, he would be inclined to redesign the landing page where a library patron came to borrow an ebook to show other books by the same author, perhaps some Also-boughts or Also-borrows and an opportunity for the borrower to voluntarily link her/his Amazon account so Amazon could understand even more about the borrower’s interests.
20 thoughts on “Hold On, eBooks Cost HOW Much? The Inconvenient Truth About Library eCollections”
There’s a two-part reason that Amazon won’t do any of that.
(1) The bad blood/fallout after US v. Apple et al. (the e-book pricefixing case). There are two seemingly contradictory aspects of this. First, there’s the predatory-pricing doctrine, which would be a loser at trial but would be horrendously expensive and distracting to defeat (basically, commercial publishers would claim that Amazon’s use of “regular list price” is predatory pricing because it’s so much lower than their jacked-up pricing to the libraries — don’t laugh, on a slightly different set of facts it is a viable antitrust claim). Second, the testimony that came out during that case before Judge Cote rightly makes Amazon distrust damned near anything from the commercial publishers.
(2) The lack of reviews in library-friendly review sources of indie books. This is by far the bigger barrier. Speaking of antitrust, though, one must wonder if there is any unfair trade practice involved at ALA Journal, PW, et al. in excluding indie books from their ordinary review process. I ask rhetorically: Isn’t it more than a bit suspicious that those publications have made exactly no effort whatsoever to expand their horizons? And without those reviews, Amazon can’t justify establishing a separate library-sales system/mechanism… that is compliant with ALA privacy standards.* There’s also the problem that Sturgeon was an optimist: More than 90% of everything is crap; this is why libraries rely upon a combination of customer requests with justifications and “higher end” reviews to make purchasing decisions. And in this sense, the libraries are even more victimized by the closed ecology of the review system (do not get me started on this, I’ll have to begin and then shut up due to various source restrictions).
* If the library uses the Overdrive platform, there ain’t nothin’ anonymous. Not nowhere, not nohow. Just ignore the hedge fund behind the curtain…
A tangential thought: we tend to deride Macmillan, but maybe they are just a little bit right about library e-book loans impacting their sales? Probably not about hardbacks, but even at their retail e-book prices – were I resident in the USA – I would never buy one of their undiscounted e-books and would wait on the library list until they book was available (or until the price dropped a lot). And as I’ve switched entirely to e-books for fiction (or second hand paper) they don’t get to sell me a hard or paperback either).
“For romance readers, fans of Avon and Harlequin are in luck …”, but I suspect that these are the books where the average reader has the least need to rely on the library, as Harlequin/Mills & Boon at least – and I presume Avon – do not charge the normal (ludicrously high) trad pub e-book prices. On the other hand, the stereotypical voracious romance reader will rack up quite a bill if they have a book a day habit (though they have Indie authors and KU as an alternative book source, although this does not help the really poor).
They published numbers but they were incomplete, without context, and unconvincing.
Overdrive had no trouble refuting them.
Besides, isn’t overcharging on ebooks, driving *some* customers to libraries, and then blaming it *all* on the libraries, just like asking for leniency from a judge for being an orphan…
…after killing the parents?
MacMillan claimed libraries accounted for 45% or ebook reads without considering that most of those reads came from people unwilling to buy the overpriced ebooks. Totally ignoring the lost sales from the bigger crowd of readers who just shrug and give their money to others, without even bothering with library embargoes or waiting lists.
They still deny price elasticity is a real economic principle or that most readers cross-shop titles.
Any injuries they might suffer are self-inflicted.
I can’t disagree with any of this.
I would take a certain pleasure in the irony of their correctly claiming that libraries have impacted their sales because overpricing e-books has driven people to use the library, were in not for the fact that they are sabotaging the careers of new writers. Would you take a chance on a new author’s e-book if it cost £10 of $12.50? I draw the line at £9.99 and then only if it’s my wife’s birthday and one of her absolutely favourite authors.
<ObviouslyRhetoricalQuestion> One must wonder if the apparent collusion among publishers in setting e-book royalties at “25% of net” (but making special exceptions for library sales meaning that authors are not generally seeing 25% of net on library e-book sales*) might be influencing this discussion. </ObviouslyRhetoricalQuestion>
And the less said about 0penR0ads and its shenanigans, the better.
* Go ahead, publishers. Just try to claim that I’m unlawfully revealing confidential trade secrets consisting of the boilerplate, functionally nonnegotiable language in contracts that you present to authors before they sign anything. Please — I could really, really use the sanctions under Fed. R. Civ. Proc. 11(b) that will result. tl;dr Don’ throw me in that there courtroom, Br’er
FoxPublisher, where everyone will have to swear to tell the truth… and violating that oath leads to potentially Interesting Consequences under 18 U.S.C. § 1621.
Around here we generally welcome BPH overpricing, methinks.
It provides a nice pricing umbrella for indies.
And if some tradpub snobs refuse to even consider Indie books that’s their problem.
It’s been ten years since Indie, Inc took off.
If a new author hasn’t figured out how to navigate the market or even search the internet for the (by now hoary) guides tbey’ll never figure it out.
I was just thinking of Joe Konrath and most of the other evangelizers of the early days. They did their duty, helped many launch their careers and are now back to taking care of business.
By now it should be clear that if you’re a newcomer and want to spend years on the query-go-round the odds won’t be with you.
Kris Rusch has just put up an interesting post on the mess trad publishing has got itself into. Her take on the difficulties faced by their new and existing authors is:
I empathize…up to a point. If they want to learn how to publish books, point them to our Publishing 101 class, and then stay out of their way. They’ve had years of warning to stay away from traditional publishing, and they didn’t listen. They’re probably not going to listen now. You know the rules about drowning victims, right? Send them a lifeline. Don’t get close enough to let them grab you and pull you down.
So pretty much what you’re saying about such authors.
What else can a rational person say or do?
It’s not our job to take care of them or fix their mistakes. Kids, yes. Mentally affected, yes. But stubborn and delusional? Nah.
Live and let die.
Some folks are beyond helping.
(And not just in publishing. There’s train wrecks all over.)
A rational person might ask what the authors’ objectives are, and then see if their actions are rational steps to meet those objectives.
The last ten years indicates there are different objectives for different authors. When we see a persistent behavior that seems to defy the rational, it’s time st step back and ask if our evaluation might be the problem.
It’s reasonable to suggest that some authors value the acceptance and inclusion the traditional route offers more then the sales and financial advantages the Amazon route offers. These authors want an agent, they want a traditional publisher, they want to experience the frustrations that come with their image of a real author. They want the experience and above all the real author status.
We could stand back and say they are irrational because their individual tastes and preferences differ from ours, they don’t accept our objectives, and they don’t value sales above all else. But those authors don’t really care what we think. They don’t care what Chris Rusch thinks. Why should they?
Some authors want money they can spend and others want a contract, any contract. Money optional.
KKR isn’t talking about the latter and neither am I.
Well, OK. What are you and Rusch talking about? What subset of authors is the topic of your discussion?
BTW, thanks for the reminder.
That column is very good.
I was tempted to comment but I didn’t have the heart to tell her 21 will be worse. What’s going on in Asia has major screwup potential.
(And that’s without factoring in the arming of the militias locally.)
The seeds have been planted.
MacMillan claimed libraries accounted for 45% or ebook reads without considering that most of those reads came from people unwilling to buy the overpriced ebooks.
How do we know the buying behavior of those people in the absence of library availability?
By the total numbers, of course.
BPH ebook sales, retail and library combined, have been declining for years, far more than print rose. Its in all the quartely reports. And it is by design.
That’s why I said their claims lacked context.
45% by itself is meaningless, a smokescreen. You need to know the total.
For 45% of ereads to be a cannibalization effect, it had to be against a base of constant total ereads, not of declining ereads.
It wasn’t cannibalizing sales but rather MacMillan total ereads went down while library ereads stayed constant or even declined. After all, at library ebook prices they can’t afford to grow much. Library budgets don’t allow it. If anything, the overpriced library ebooks are keeping ebook revenue decline from revealing how badly their unit sales have been declining.
“lies, damn lies, and statistics”.
Again: the BPHs refuse to accept price elasticity or the degree of fungibility of individual titles. Any resulting wounds are self-inflicted.
That tells us nothing about what the buying behavior of library patrons would be without the library access.
I don’t know what MacMillan said, and really don’t care. They don’t know the answer to the question, either.
BPH behavior indicates they live and breathe by acceptance of price elasticity and the substitution effect. Their behavior is consistent with maximizing total sales in a declining market where their competitive advantage has eroded.
They know full well that high eBook prices reduce eBook sales. That’s why they keep them high. They want to keep paper sales up, and limot substitution, because that is where their competitive advantage is. Lowering eBook prices would sell lots more eBooks, but fewer paper books.
They have a huge competitive advantage with eBooks due to the cross promotion that comes from paper. It’s a balancing game looking at their full range of products.
Their behavior is consistent with taking as much cash out of a declining market as possible while maintaining the health of the balance sheet.
Sure it does.
They’ll read something else.
This isn’t a theoretical discussion.
Macmillan *did* embargo the libraries.
And sales didn’t go up.
You may raise all the theoretical what-ifs you want to float, but the observed real world says that if the readers don’t want to buy at those prices and they can’t go to a library, they’ll buy/read something else.
If readers don’t like the price, they won’t buy.
More: it has been demonstrated that library availability *increases* visibility and sales; it does not reduce them.
The same effect has been onserved with rentals in other content businesses, most recently and prominently in Microsoft’s GAMEPASS. Word of mouth is the primary force behind the effect but also replayability/rereading and ownership value.
It is especially strong with book series: read one free, get hooked buy the rest. The BAEN free library has demonstrated this for 20 years. Permafree and free promos also prove it; lots of indies get increased sales following a free promo.
Do note that the BPHs routine copy each other when it comes to squeezing authors and customers and nobody copied MacMillan. Even they understood MacMillan was shooting at their own feet.
Of course it’s theoretical. These are plausible and interesting hypotheses. Now we need the experiment. It hasn’t happened.
People are indeed very attached to the idea that libraries don’t compete with cash sales. But, there is only conjecture and emotion, not economic demonstration.
I agree the substitution effect is in play. That’s why publishers pay attention to elasticity and keep eBook prices high. The MacMillan example supports the idea that library books compete with sales.
If libraries want to provide what our users want, we’ll pay their prices on their terms, no matter how ludicrous, because what choice do we have?
Don’t buy it?
Don’t forget the e-systems that libraries use to buy & distribute ebooks. As an Indie, I can’t even donate my ebooks to my local libraries, much less charge for them directly as a publisher, because they can’t (or can’t figure out how to) add them to their systems.
Until that changes, indies have no entree into libraries other than Overdrive and its ilk. Or print editions.
As near as I can tell most libraries haven’t set up an ebook system of tbeir own: they just let Overdrive or whatever store and serve the books. I doubt tbey can even serve PD ebooks on their own.
If they’re getting ripped off its only because tbey’re complicit.
I wouldn’t call it laziness necessarily but the inertia, it burns.
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