[Infowarrior] - As Library E-Books Live Long, Publisher Sets Expiration Date

[Richard Forno]

March 14, 2011
As Library E-Books Live Long, Publisher Sets Expiration Date

By JULIE BOSMAN

http://www.nytimes.com/2011/03/15/business/media/15libraries.html?_r=1&hp=&pagewanted=print

Imagine the perfect library book. Its pages don’t tear. Its spine is unbreakable. It can be checked out from home. And it can never get lost.

The value of this magically convenient library book — otherwise known as an e-book — is the subject of a fresh and furious debate in the publishing world. For years, public libraries building their e-book collections have typically done so with the agreement from publishers that once a library buys an e-book, it can lend it out, one reader at a time, an unlimited number of times.

Last week, that agreement was upended by HarperCollins Publishers when it began enforcing new restrictions on its e-books, requiring that books be checked out only 26 times before they expire. Assuming a two-week checkout period, that is long enough for a book to last at least one year.

What could have been a simple, barely noticed change in policy has galvanized librarians across the country, many of whom called the new rule unfair and vowed to boycott e-books from HarperCollins, the publisher of Doris Lessing, Sarah Palin and Joyce Carol Oates.

“People just felt gobsmacked,” said Anne Silvers Lee, the chief of the materials management division of the Free Library of Philadelphia, which has temporarily stopped buying HarperCollins e-books. “We want e-books in our collections, our customers are telling us they want e-books, so I want to be able to get e-books from all the publishers. I also need to do it in a way that is not going to be exorbitantly expensive.”

But some librarians said the change, however unwelcome, had ignited a public conversation about e-books in libraries that was long overdue. While librarians are pushing for more e-books to satisfy demand from patrons, publishers, with an eye to their bottom lines, are reconsidering how much the access to their e-books should be worth.

“People are agitated for very good reasons,” said Roberta Stevens, the president of the American Library Association. “Library budgets are, at best, stagnant. E-book usage has been surging. And the other part of it is that there is grave concern that this model would be used by other publishers.”

Even in the retail marketplace, the question of how much an e-book can cost is far from settled. Publishers resisted the standard $9.99 price that Amazon once set on many e-books, and last spring, several major publishers moved to a model that allows them set their own prices.

This month, Random House, the lone holdout among the six biggest trade publishers, finally joined in switching to the agency model. Now many newly released books are priced from $12.99 to $14.99, while discounted titles are regularly as low as $2.99.

HarperCollins, in its defense, pointed out that its policy for libraries was a decade old, made long before e-books were as popular as they are today. The new policy applies to newly acquired books. “We have serious concerns that our previous e-book policy, selling e-books to libraries in perpetuity, if left unchanged, would undermine the emerging e-book ecosystem, hurt the growing e-book channel, place additional pressure on physical bookstores, and in the end lead to a decrease in book sales and royalties paid to authors,” the company said in a statement.

It is still a surprise to many consumers that e-books are available in libraries at all. Particularly in the last several years, libraries have been expanding their e-book collections, often through OverDrive, a large provider of e-books to public libraries and schools. Nationwide, some 66 percent of public libraries offer free e-books to their patrons, according to the American Library Association.

For many libraries, interest from patrons who want to check out e-books has been skyrocketing. At the New York Public Library,  e-book use is 36 percent higher than it was only one year ago. Demand has been especially strong since December, several librarians said, because e-readers were popular holiday gifts.

“As our readership goes online, our materials dollars are going online,” said Christopher Platt, the director of collections and circulating operations for the New York Public Library.

In borrowing terms, e-books have been treated much like print books. They are typically available to one user at a time, often for a seven- or 14-day period. But unlike print books, library users don’t have to show up at the library to pick them up — e-books can be downloaded from home, onto mobile devices, personal computers and e-readers, including Nooks, Sony Readers, laptops and smartphones. (Library e-books cannot be read on Amazon’s Kindle e-reader.) After the designated checkout period, the e-book automatically expires from the borrower’s account.

The ease with which e-books can be borrowed from libraries — potentially turning e-book buyers into e-book borrowers — makes some publishers uncomfortable. Simon & Schuster and Macmillan, two of the largest trade publishers in the United States, do not make their e-books available to libraries at all.

“We are working diligently to try to find terms that satisfy the needs of the libraries and protect the value of our intellectual property,” John Sargent, the chief executive of Macmillan, said in an e-mail. “When we determine those terms, we will sell e-books to libraries. At present we do not.”

And those publishers that do make their e-books available in libraries said that the current pricing agreements might need to be updated.

Random House, for example, has no immediate plans to change the terms of its agreements with libraries, said Stuart Applebaum, a spokesman for the publisher, but has not ruled it out in the future.

“Anything we institute ahead we’d really want to talk through with the community and together understand what makes sense for us both,” Mr. Applebaum said. “We’re open to changes in the future which are in reasonable step with the expectations and realities of the overall library communities.”

Publishers are nervous that e-book borrowing in libraries will cannibalize e-book retail sales. They also lose out on revenue realized as libraries replace tattered print books or supplement hardcover editions with paperbacks, a common practice. Sales to libraries can account for 7 to 9 percent of a publisher’s overall revenue, two major publishers said.

But e-books have downsides for libraries, too. Many libraries dispose of their unread books through used-book sales, a source of revenue that unread e-books can’t provide.

The American Library Association has assembled two task forces to study the issue.

Even among the librarians who have stopped buying HarperCollins e-books, many said that there might have to be a compromise.

“I can see their side of it,” said Lisa Sampley, the collection services manager in the Springfield-Greene County Library District in Springfield, Mo. “I’m hoping that if other publishers try to change the model, they think about the libraries and how it will affect us. But I’m sure there is some kind of model that could work for us both.”