This Deal Is Getting Worse All the Time

November 22, 2011
Posted in: Board Member Posts, Buzz

Lando and Darth Vader -- Robot Chicken: Star Wars

A second major publisher has altered the deal by which libraries can lend ebooks via libraryland über-vendor Overdrive. In February, the first publisher, Harper Collins, restricted the number of checkouts of its ebooks. Yesterday, word came down that Penguin Group USA is suspending libraries’ lending of  the publishers’ new ebook titles. Given that with Kindle format ebooks, both new and backlist titles are affected, Penguin’s move essentially eliminates Kindle support from a subset of Overdrive’s collections.

Of course, I can’t help but think, “here we go again,” because this latest situation reinforces what we learned during HCOD about the weaknesses in the agreements through which libraries can lend ebooks. Libraries get handed restrictions major restrictions on content from publishers, without evidence of legitimate threats to their content; and yet  libraries have no voice: Overdrive negotiates ostensibly on behalf of libraries; but when Penguin advised Overdrive to suspend lending of some of its ebooks last week, libraries were not advised. As Overdrive says it is “working with Penguin on this issue”, libraries are not part of that process: we cannot state our case and advocate for our patrons.  Because libraries have given so much control to Overdrive, our relationships with publishers have been compromised. Libraries are not partners, we’re customers. So, Amazon can build ads into Overdrive, but we can’t build our values into Adobe Digital Editions.

I am concerned about what this latest change in our deal with Big Publishing means for the role of DRM in libraries. This year, we have seen two of the Big Six publishers determine that the predominant DRM systems – Adobe Digital Editions (ADE) and Amazon—offer content protection that is insufficient to allow library lending, and force heavy-handed changes on us: Harper Collins added supplemental restrictions, while Penguin has removed content from both systems. These publishers feel that existing DRM and ebook content-protection practices aren’t good enough. These systems (ADE in particular) that drive libraries crazy because they are so restrictive and complicated, aren’t getting the job done. If publishers can’t allow lending with these technologies, I shudder to think what system would make them feel comfortable.

Fun with Kindle App's splash page. Image by Matt Weaver

The Amazon DRM system, far easier than ADE, has cost libraries plenty: our use of it hasn’t prevented Amazon from developing a competing ebook lending service for which I think libraries are R&D guinea pigs. The Amazon/Overdrive library lending model has built into it an ever-present system of advertising.

But, perhaps the highest cost to libraries for getting Kindle support of library ebooks is the exclusivity of the Kindle to Overdrive. The arrangement between Amazon and Overdrive benefits Overdrive, but not libraries. For a library considering an alternate ebook provider, having to explain to Kindle owners that once again, the library would not be able to provide them with ebooks, would be a daunting prospect. With Penguin’s latest moves, we will get a little taste of what that would be like when we tell our Kindle-owning patrons that they cannot get certain ebooks.

Since Penguin’s restrictions are toughest on Kindle, that Overdrive/Amazon arrangement may have cost libraries some content. What does losing new content from a top publisher do the value of our ebook collections? Despite compatibility with the Kindle, and further advances Overdrive promises through its Overdrive WIN program, what remains unchanged is the broken acquisitions model, and the costs that are out of whack with print acquisitions. Given the complete lack of competitive pressure to drive costs down, nothing exists in the market that will improve value for libraries. The addition of restrictions on content, and the removal of content from our collections reduces the value: failing to satisfy publishers’ concerns about the protection of their content will lead to more of both. If other publishers follow Penguin’s lead, Overdrive could be reduced to little more than the Freegal of ebooks: an expensive provider with a limited catalog.

Today libraries must consider how to explain to patrons that their holds on Penguin titles will not be fulfilled; tomorrow, you may see a tweet that says “Penguin restores Overdrive ebooks.” Will you sigh with relief and move on to the next item in your feed, or will you look at the terms by which the content was returned? I am guessing whatever terms restore ebooks for our users–if it happens–will not be beneficial to libraries.

Matt Weaver

Board Member

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