Publishers worry as ebooks fly off libraries’ virtual shelves

From Ars Technica:

Before Sarah Adler moved to Maryland last week, she used library cards from her Washington, DC, home and neighboring counties in Virginia and Maryland to read books online. The Libby app, a slick and easy-to-use service from the company OverDrive, gave her access to millions of titles. When she moved, she picked up another card, and access to another library’s e-collection, as well as a larger consortium that the library belongs to. She does almost all of her reading on her phone, through the app, catching a page or two between working on her novels and caring for her 2-year-old. With her husband also at home, she’s been reading more books, mostly historical romance and literature, during the pandemic. In 2020, she estimates, she has read 150 books.

Adler buys books “rarely,” she says, “which I feel bad about. As someone who hopes to be published one day, I feel bad not giving money to authors.”

Borrowers like Adler are driving publishers crazy. After the pandemic closed many libraries’ physical branches this spring, checkouts of ebooks are up 52 percent from the same period last year, according to OverDrive, which partners with 50,000 libraries worldwide. Hoopla, another service that connects libraries to publishers, says 439 library systems in the US and Canada have joined since March, boosting its membership by 20 percent.

Some public libraries, new to digital collections, delight in exposing their readers to a new kind of reading. The library in Archer City, Texas, population 9,000, received a grant to join OverDrive this summer. The new ebook collection “has really been wonderful,” says library director Gretchen Abernathy-Kuck. “So much of the last few months has been stressful and negative.” The ebooks are “something positive. It was something new.”

. . . .

But the surging popularity of library ebooks also has heightened longstanding tensions between publishers, who fear that digital borrowing eats into their sales, and public librarians, who are trying to serve their communities during a once-in-a-generation crisis. Since 2011, the industry’s big-five publishers—Penguin Random House, Hachette Book Group, HarperCollins, Simon and Schuster, and Macmillan—have limited library lending of ebooks, either by time—two years, for example—or number of checkouts—most often, 26 or 52 times. Readers can browse, download, join waiting lists for, and return digital library books from the comfort of their home, and the books are automatically removed from their devices at the end of the lending period.

The result: Libraries typically pay between $20 and $65 per copy—an industry average of $40, according to one recent survey—compared with the $15 an individual might pay to buy the same ebook online. Instead of owning an ebook copy forever, librarians must decide at the end of the licensing term whether to renew.

. . . .

Last year, Macmillan took an additional step, limiting each library system to only a single digital copy of a new title—at half its usual price—until it had been on the market for two months. Macmillan CEO John Sargent said he worried there was too little friction in library ebook lending. “To borrow a book in [the pre-digital days] days required transportation, returning the book, and paying those pesky fines when you forgot to get them back on time,” he wrote in a letter announcing the policy. “In today’s digital world there is no such friction in the market.” Many librarians, arguing the Macmillan policy hurt large urban systems that already struggle to keep up with demand for new and noteworthy books, organized to boycott the publisher.

. . . .

The House Antitrust Subcommittee last year launched an investigation of competition in the digital marketplace, and subcommittee chair Representative David Cicilline (D–Rhode Island) has met with library advocates. “The whole issue of this negotiation [between libraries and publishers] over the last decade derives from a place where libraries have almost no rights in the digital age,” says Alan Inouye, the senior director of public policy and government relations at the American Library Association. “In the longer run, there needs to be a change in the environment or in the game. That means legislation or regulation.”

Link to the rest at Ars Technica

PG thought the question of whether libraries were good or bad for publishers had been resolved a long time ago.

The resolution goes something like this:

  1. Libraries allow people to read books at no cost.
  2. A meaningful portion of people who read books they check out from libraries will find they enjoy reading and will continue to read books on a regular basis.
  3. Once a person becomes an avid reader, they are quite likely to continue this habit for a long time.
  4. Some avid readers will become wealthy enough so they’ll just buy a copy of a book they think they will like rather than wait until the library has a copy available to loan.
  5. Some avid readers will always be willing to wait to read a book they think they will really like until it becomes available at their library.
  6. Some avid readers won’t want to wait for several weeks until a book is available at the library and will decide to buy it instead, even if they’re not particularly wealthy.
  7. Avid readers are among the most effective advocates for books and authors they like. Unlike advertising and promotion activities, avid readers don’t cost publishers a cent.
  8. At least some avid readers will flock together in what are called book clubs.
  9. When a book club decides to read a book, it is likely that all copies available at the local library that aren’t already checked out will quickly disappear from the library shelves.
  10. Avid readers in book clubs, avid readers who are friends of other avid readers, etc., etc., tend to buy many more books than people who never caught the reading bug at no cost via their local library.

Ergo, libraries promote more reading, which creates more readers, which creates more book purchasers, which means publishers make more money.

People borrowing books from libraries in any form are likely the best way that publishers can ensure the creation of more and more long-term customers.

But acting on that understanding would require long-term thinking on the part of traditional publishers.

Among many other things that traditional publishers are not good at doing, engaging in long-term thinking may be the most damaging. In the long run.

14 thoughts on “Publishers worry as ebooks fly off libraries’ virtual shelves”

  1. Meanwhile, libraries ignore everything from Indies and small presses.
    (With rare exceptions, if it’s not in tbe establishment journals they ignore it.)

    When Smashword made a deal with Overdrive to offer Indie ebooks, the libraries asked they be listed separately, effectively ghettoizing them.

    The BPHs keep turning the screws on libraries because they know the libraries will grumble but accept whatever they do. After all, what are they going to do, buy Indie?

    (With Apologies to Warren Beatty’s BULWORTH.)

  2. In no particular order, numbered just for convenient reference later:

    (1) There is a yuuuuuuuuuuuuge logical hole in the publishers’ position, and it’s the same one that created such financial problems: Overpricing of e-books (and books generally) encourages piracy. The only historically effective control on counterfeit goods — since the beginnings of “branding” in the seventeenth century — has been to provide the authentic goods at a price perceived by the end-users as sufficiently low and simultaneously of sufficiently greater quality to the counterfeit goods to limit market share of counterfeits. The publishing industry… not so much, and hasn’t learned from the recorded-music industry’s problems and the DVD segment’s problems.

    Back of the envelope calculations indicate that trade fiction e-books should, in 2016, have averaged around $12 or less to avoid encouraging too much “alternate source” cut in; let’s just say that bore no resemblance to reality.

    (2) The publishers think they are entitled to a sold copy for every reader. Some readers, though, cannot or will not purchase list-price new books. (For any small-apartment dweller, space is an obvious problem!) In particular, the “sold copies only” meme is rather strongly class-selective. <sarcasm> But the publishing industry has never had any problems with blindness toward those in the 75%. Not even among its workforce. </sarcasm>

    (3) Let’s not forget the excessive premium charged to libraries by publishers.

    And, perhaps most disturbingly, responding to Felix:

    (4) The problem with libraries and indies is that there is no reputable evaluation of the quality of indie works and their suitability for collections. None. Libraries and librarian simply do not have the time or other resources to directly screen potential materials. What’s that, you say? Rely on reader ratings and feedback? Ever hear of “Harriet Kaufman”? Or any of the other goofiness in inherently-nonreputable reader ratings?

    In the best of all possible worlds, libraries would have unlimited resources (money and personnel) to do a professional job with building their collections. They don’t; so they limit their horizons to sources for which they can get reputable evaluations in advance. (Not to mention avoid too much trouble with objectionable materials… and inaccurate/harmful directions, etc.)

    • Ss to (4):

      Libraries prefer to overpay massively on ebooks, rather than hiring a part-timer to skim rankings and reviews at Amazon, B&N, and Apple. Considering all tbose sites highlight recent releases it would hardly take long to compile a handful of genre specific candidate lists for patrons to vote on at a library page.

      How many bright high-schoolers would jump at that skimming job?

      It’s not lack of resources as much an organizational inertia.

      • Felix, it’s also about the politics of who and how many libraries can hire, since they’re government units.

        As a specific example, consider the part of the library in the eeeeeeeeevil of the Dewey Decimal system that falls between 340.1 and 347.85: The part that occupies the letter K in the Library of Congress system. The law books. Library staff do not have the expertise to weed these materials for either crankishness (income-tax protesters) or deceptive datedness (“do your own immigration paperwork” guides from a decade ago are worse than useless; “fight your own traffic ticket” guides from up to three decades ago may be helpful). So, just try being a lawyer — or even Bar Association — who offers to provide guidance to the library, hoping even anonymously to keep readers from hurting themselves, and see what hoops you have to jump through… because that would constitute the local government probably violating open-meeting rules if nothing else!

        • …and what fights they choose to fight.

          They do have the power to argue that reducing reliance on overpriced corporate ebooks actually makes the budget go farther and gives them some leverage with the Manhattan Mafia.

          I’m pretty sure neither Smashwords nor Kobo charges anywhere what the Penguin et al charge.

          But as the old corporate reengineering gurus of the 90’s used to say “If you keep on doing what you always did, you’ll keep on getting what you always got.”

          Not all libraries kiss the ring, you know. Some library systems do fight city hall.
          Helplessness is often optional.

    • I googled, but didn’t find anything about Harriet Kaufman and the curiosity is killin’ me. Got a link?

  3. I smell a real opportunity for Amazon KU in this morass. How they could pull it off, I don’t know; but I think that they could do something with libraries on this matter.

    I’m in Canada, Kingston Ontario. Last year, my wife was researching her latest haunting book (she has a series called ‘The Hauntings Of Kingston’. She was tracking down a true story she heard and was trying to get old newspapers and such. She went to our local public library and was given a L O T of help- so much that the librarian became a character in the book! LOL

    About a week after her working with the librarian, we saw a SLEW of paperbacks, 6 copies of each of her books in the series blow thru the door (we’re a mid-list Indie, not a Mark Dawson/ Amanda M. Lee Indie! LOL) Yeah, 40 or so paperback sales in a day was a big deal. It turned out the library put one of each title in each branch.

    Guess who made a healthy donation to our local library.

    I really hope that something can be done b/t Zon & libraries via KU. Otherwise, as an earlier commenter pointed out, it’s just going to make piracy more prevalent.

    • Kobo offers Indies a way into Overdrive and Canada supports Kobo so this is no surprise.

      If US libraries were willing, Kobo could make a better case for their own subscription service and “going wide”. And that might prod Amazon into being bidirectional with libraries.
      As is, Kindle ereaders allow library books in but KDP Select doesn’t provide books going out except as individual sales.

      Theoretically, Select could easily add a new tier (another selection alongside DRM, TTS, etc) where Indies could register their books for library licenses, either a fixed number of lends or unlimited. Overdrive already supports Kobo and Smashword ebooks so it wouldn’t be particularly hard to support KDP Select books, particularly since tradpubbed library ebooks are distributed from Amazon servers not Overdrives.

      It isn’t tech keeping Indie ebooks out of libraries but rather the lack of demand.
      Libraries are as much a walled garden as Apple’s iOS.

    • “Tis a mystery.” – Shakespeare in love.

      It varies. Some say it is a major concern requiring paying somebody to protect their books, some shrug it off as minor shoplifting. Some are very loud that they are being robbed, others say it is free promotion.

      Neil Gaiman and Paolo Coelho are in the latter camp.
      Chuck Palahniuk was in the former but he eventually discovered his declining revenues were from his agent’s accountant embezzling $3.4M before anybody noticed.

      In between, many think there are bigger problems for authors.

      • The fundamental problem with piracy, just like with trying to discuss “publishing,” is that its impact is not uniform. Paolo Coelho’s marginal loss of income (leaving aside ideological preferences) is impacted a lot less by the median 16,000 or so downloads of pirated editions of his books than is Joe (Jo?) Newauthor’s. And without delving into data source penetration and reliability, even unknown Joe (Jo) suffers from at least half that many pirated downloads.

        tl;dr A “universal” response is like prescribing a universal healthy diet when the population includes people with nut allergies.

    • Behind the “Piracy is a terrible problem with electronic media” is the assumption that someone who pirates an ebook or similar electronic product would purchase it if he/she/they couldn’t get it for nothing via piracy.

      My speculation is that 90% of pirates like the challenge and the buzz they get from acquiring something for nothing. If true, this doesn’t sound like someone who is a likely purchaser of an ebook.

      • Oh, it’s true.
        As the Napster trials proved, most downloaders are hoarders, grabbing content they’ll never live long enough to consume. Tens of thousands of songs.
        The Carnoy piece was about a single torrent with a grabbag of 2500 ebooks. Even the rare 100-books-a-year avid reader would take a quarter century to actually consume thsf if they were really going to read them.

        It’s all about “free!” .
        The power of “free!” is mighty.
        But only meaningful to cheap politicians with nothing else to offer.
        In the business world even permafree is barely meaningful in the age of KU.

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