The increase in lending might be good news for libraries, but it is unclear whether publishers will find it so. If a lent e-book displaces a sale, as some publishers seem to believe, that means that many more people won’t actually buy their books or e-books. (This is undoubtedly why HarperCollins put a 26-checkout limit on its e-books and Penguin has ceased providing any to libraries at all.)

It’s not clear exactly why Penguin is doing this. The reason the company gave for its e-book restrictions was “concerns about the security of the copyright of its authors.” It has not given any explanation for this audiobook restriction. As Laura Hazard Owen notes on PaidContent, frustrated library patrons are significantly less likely to buy an audiobook if they can’t check it out, given how much more expensive audiobooks are than e-books or hardcovers.

Regardless, this is not going to make it any easier for libraries to meet all their patrons’ needs in the digital age.

A librarian replied that “our [Overdrive] representative has told us that we can expect Kindle books within the next week,” and linked me to Overdrive’s own press release on the matter. That release states that the company “announced today that it has begun adding Kindle compatibility to all of the U.S. public and school libraries in its network and expects to have all sites updated within days.”

The 11,000 figure surfaces again, this time as the number of libraries nationwide that support Overdrive lending in general. So we can probably take from this that the Kindle capability is being added to every single library that already had Overdrive lending—and also that Amazon might have been a little premature in saying that “Kindle books are available at more than 11,000 libraries in the U.S.” Perhaps that “are” should instead have been “will soon be.”

It’s not clear to me that there’s anything particularly special about this program compared to other Overdrive library e-book lending, save that the Kindle and Amazon are involved. Still, it’s putting library e-books into the hands of people who own the most popular e-reader currently on the market, and that could have a pretty big impact down the road once it spreads to more regions.

Throughout the conference, CEO Steve Potash, looking like a kid with a delicious secret, kept saying “soon” and, “I’m not allowed to announce a date yet.” During the final session, he delivered a broad hint, by summarizing the main points of his “Crystal Ball Report” :

Streamlining (both downloading and ordering)
Explosion (we have gone from two reading devices to 85 and more are coming)
Premium (the library catalog as the most premium, value-added site on the Web)
Traffic (enormous growth coming by year’s end)

Even without this clue, it makes sense that Amazon would roll out library lending when Pottermore starts selling the Harry Potter books on October 1st, since OverDrive will be responsible for distributing the Kindle format of Rowling’s books via its WIN platform.

Via paidContent

(Photo: kodomut)

Starting now, when customers check out a title, the device will have a box where they can check “Remember me on this device.” The device will then hold the characters in its memory for 90 days after each use. This is an optional service. If a library requires a pin, it will still be required to check out titles.

This update is a part of OverDrive WIN, a series of platform enhancements that will streamline user experience and provide access to more content. Check back to see more enhancements to your service.

Via No Shelf Required

Allowing library patrons to check out an actual e-reader does come with some security concerns. But the St. Paul libraries are comfortable with the risk.

“Our biggest focus is giving access to people who can’t afford them,” said Sheree Savage, a spokeswoman for the St. Paul libraries. With any library materials, security is always a concern, she said. But the 3M e-reader only can be used to read materials available from the library, so this reduces the chance that someone might walk off with it, she said.

Update 12 July 2011: I over-abbreviated this post, and left out some useful and necessary details. Here they are for future readers:

• Txtr is providing the operating system, but not the hardware, according to the article cited.
   
• It’s the St. Paul Public Library System that’s participating in the program.
   

You can read the full article at TwinCities.com

• AMG
• Bold Strokes Books
• Books to Go Now
• Carina Press
• Gideon Informatics
• Joe Konrath
• KBS
• Microsoft Press
• O’Reilly Media
• Rock Nook
• Romance Divine LLC
• Rosenfeld Media
• Sher Music
• Simonelli Editore
• TidBITS
• University Press of Colorado
• Wildside Press

More from the blog post: “All DRM-free eBooks are available under the one-copy/one-user model, which means you can add a copy to your collection and one user at a time can borrow the title from the library. Just like all other OverDrive-supplied content, the titles will be borrowed for a set amount of time and when that lending period is up, another user can check out the title.”

Update: Here’s an audio interview that Sue Polanka did with Dan Stasiewski, the PR manager at OverDrive and the author of the above-linked post.

Via INFOdocket.

(Photo: Paul Stainthorp)

At the moment, some British publishers do permit library lending (via e-book lending distributor Overdrive), others do not, and HarperCollins is “not ruling out” the same sort of 26-loan limit that its US division has imposed. Some UK librarians have said they would really like to be able to offer the sort of Kindle-based lending that Amazon recently announced for US libraries.

The place e-books have in UK libraries is complicated by the fact that the Public Lending Right—the UK government-funded system that pays authors whenever a library lends one of their books—has not yet been extended to e-books. (In fact, the PLR was a target for elimination in the UK’s latest round of budgetary discussions. It survived, though not without cuts.) So if someone “checks out” an e-book, the author is not paid, whereas he would be if they checked out a printed book.

It remains to be seen just what place e-books will end up having in libraries as printed books diminish, but these talks could be important in determining how they go over the next few years.

"It’s amazing," says Diane Eidelman, administrator for member services at the Suffolk Cooperative Library System, a consortium of over 50 libraries on New York’s Long Island. "We just can’t keep up with the e-book demand. We’ll purchase an enormous amount of content, and within 24 hours it’s all checked out."

Indeed, the numbers tell the story. In the past 18 months, the Suffolk consortium’s e-book expenditures have tripled. In the first few months of 2011 alone, Eidelman says, the library system has increased its e-book budget by 66%. And still, patrons can’t get e-books fast enough. Earlier this month, the e-book version of James Patterson’s 2010 thriller, Don’t Blink, had a staggering 108 holds, she says, even though the library tries to purchase enough copies so there are no more than two reserves at a time. "We’ll probably have to buy more copies," she notes. "We believe that’s good customer service. But it is incredibly expensive. E-book purchases really are almost patron-driven at this point, and every few months we put more money into e-books."

Library e-book provider Overdrive reports that library e-book usage is essentially doubling every year, and some publishers are getting concerned. Apart from the widely-reported HarperCollins decision to impose lending limits, Simon & Schuster and Macmillan don’t lend library e-books at all.

"We have not yet found a business model that makes us happy," S&S CEO Carolyn Reidy explains in a recent Publishing Point interview. Macmillan CEO John Sargent, in another Publishing Point interview, suggests that free digital copies that can be delivered conveniently right to one’s device was at issue. "It’s like Netflix, but you don’t pay for it. How is that a good model for us?" Sargent asks.

But others, such as a vice president of Random House, point out that libraries “create readers” and getting library readers hooked on their books is not a bad thing, free or not.

Still, given that it is not really possible for a library to “own” an e-book in the same sense as it owns its paper books—or for that matter, to transfer ownership to other libraries or send it out via interlibrary loan—the question of what is going to happen to libraries as e-books wax and paper books wane is a thorny one that has a number of industry professionals concerned. Is a library without any physical books at all still a library?

Someday, we may find out.

In 2010, 718 million book and title catalog pages were viewed via OverDrive “virtual branch” library pages, but only 15 million digital titles were checked out, meaning that readers are viewing information about books through their libraries before making purchases elsewhere. But libraries are just a start. Adding titles to retail catalogs, eBook stores on devices, schools, and any other outlet can help promote your title and ultimately lead to a sale in the future. Furthermore, it is now clear that multi-channel online stores are actually helping brick-and-mortar stores, which is why it is so important to make the two sales channels complementary.

The post also points out that many tablets and e-readers can download books at bookstore and library locations as well, and that analysts predict more non-PC computing devices will be sold this year than PCs.

Certainly, there is potential for publishers to branch out and make sales in more places than just traditional e-bookstore settings. What if, for instance, library programs offered readers the chance to convert a checkout into a purchase if they decided they liked the e-book enough to want to keep it? What if some portion of the purchase price went to support the library as an agency fee?

This would make more sense than imposing artificial limits on how many times an e-book can be checked out. Perhaps HarperCollins and other publishers might consider a partnership of this nature rather than the adversarial stance of the last month or so. HarperCollins has described its position as “a work in progress”, so hopefully they can work something out.

Regardless, OverDrive definitely has a point that digital goods provide a lot more opportunities for distribution and partnerships than physical goods of old. E-books could be used as downloadable promotional items very easily—as indeed they were by Barnes & Noble last year, giving them out to get people to come into their stores. There are a lot of possibilities, and e-book marketing up to now have barely scratched the surface.

Marwell explains that HarperCollins is “committed to libraries” but concerned that unlimited library e-book lending could “undermine the emerging e-book eco-system, 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.”

He points out that twenty-six circulations at two weeks per lend would cover a year’s worth of lending high-demand titles, and longer for less popular back-catalog titles, and as with e-book retail sales, prices for older e-books will decline to the paperback price point. “Our hope is to make the cost per circulation for e-books less than that of the corresponding physical book. In fact, the digital list price is generally 20% lower than the print version, and sold to distributors at a discount.”

It seems unlikely librarians and their partisans will find this explanation terribly reassuring. On the other hand, by replicating a lot of purchasable e-books’ advantages (the instant gratification and portability, no need to remember to return it to the library in person), library lending could very well prevent at least some sales that otherwise would have happened for e-books people only want to read once.

It remains to be seen how well this policy change is going to work out for HarperCollins, and whether the incipient boycott will change its mind. (Most boycotts don’t amount to much since the number of people boycotting is usually a fairly insignificant fraction of the overall customer base.)

The publisher also issued a short statement: "HarperCollins is committed to the library channel. We believe this change balances the value libraries get from our titles with the need to protect our authors and ensure a presence in public libraries and the communities they serve for years to come."

What presence? The presence that budget-crunched libraries can’t afford to purchase again once they’re loaned out 26 times? Great move, HC!

Of course, the idea is that printed books wear out after a certain number of lendings (30-35, says this librarian). And since the publishing industry never tires of thinking up ways to make e-books act more like print, this sort of thing probably should have been expected sooner or later. Needless to say, librarians and their partisans are upset, and a Twitter protest is going on under the hashtag #hcod.

It’s unclear whether, like agency pricing, this practice is going to spread to the other publishers. I wonder if any of them will realize just how bad this is making HarperCollins look. I mean, come on, libraries are having enough budget trouble already, and it’s not like you’re going to make a huge amount of money off of them in any case. And they expose people to your books who might decide they like them enough to buy them in another form. Do you really want to go this way, HarperCollins? Seriously?

(Found via ReadWriteWeb.)

From the press release:

Libraries and schools worldwide were at the forefront of the eBook boom in 2010, as patrons and students downloaded millions of digital books for iPhone®, Android™, Sony® Reader, NOOK™, and personal computers. More than one million new users signed on to access free eBooks, audiobooks, and more from ‘Virtual Branch’ websites last year, resulting in a 200 percent increase in eBook checkouts and a 52 percent increase in audiobook checkouts over 2009. To find eBooks, audiobooks, music, and video titles from a library near you, visit http://search.overdrive.com.

Key statistics for library eBooks, audiobooks, and more from OverDrive-powered digital catalogs include:

• 718 million book and title catalog pages viewed
• 15 million digital titles checked out
• 6.6 billion minutes of spoken word audio downloaded
• 400,000 copyrighted eBook, audiobook, music, and video titles available to libraries

Library users are able to download eBooks over the air directly to their iPhone®, iPod touch®, and Android™ tablet or phone, in addition to downloads for PC, Mac®, and popular eBook readers. The free OverDrive Media Console apps launched with EPUB eBook support in December 2010 and helped drive new records for library mobile checkouts. OverDrive will release an optimized iPad™ app with eBook support, as well as BlackBerry®, with other platforms in development.

“The Girl with the Dragon Tattoo” was the most downloaded adult fiction eBook and audiobook of the year, as Stieg Larsson’s Millennium Trilogy enthralled library customers in 2010. On the adult nonfiction side, Elizabeth Gilbert’s “Eat, Pray, Love” topped the eBook and audiobook charts. Titles from Kathryn Stockett, Malcolm Gladwell, and Chelsea Handler were also among the most downloaded books from the library in 2010. The top five titles in each adult category include:

Most Downloaded Adult Fiction eBooks from the Library (2010)

1.     “The Girl with the Dragon Tattoo,” Stieg Larsson, Knopf Doubleday Publishing Group

2.     “The Help,” Kathryn Stockett, Penguin USA, Inc.

3.     “The Girl Who Played with Fire,” Stieg Larsson, Knopf Doubleday Publishing Group

4.     “The Girl Who Kicked the Hornet’s Nest,” Stieg Larsson, Knopf Doubleday Publishing Group

5.     “The Lost Symbol,” Dan Brown, Knopf Doubleday Publishing Group

Most Downloaded Adult Nonfiction eBooks from the Library (2010)

1.     “Eat, Pray, Love,” Elizabeth Gilbert, Penguin Group USA, Inc.

2.     “Sh*t My Dad Says,” Justin Halpern, HarperCollins

3.     “Outliers,” Malcolm Gladwell, Little, Brown and Company

4.     “SuperFreakonomics,” Steven D. Levitt & Stephen J. Dubner, HarperCollins

5.     “Chelsea Chelsea Bang Bang,” Chelsea Handler, Grand Central Publishing

Most Downloaded Adult Fiction Audiobooks from the Library (2010)

1.     “The Girl with the Dragon Tattoo,” Stieg Larsson, Books on Tape

2.     “The Help,” Kathryn Stockett, Books on Tape

3.     “The Girl Who Played with Fire,” Stieg Larsson, Books on Tape

4.     “The Lost Symbol,” Dan Brown, Books on Tape

5.     “The Girl Who Kicked the Hornet’s Nest,” Stieg Larsson, Books on Tape

Most Downloaded Adult Nonfiction Audiobooks from the Library (2010)

1.     “Eat, Pray, Love,” Elizabeth Gilbert, Books on Tape

2.     “Blink,” Malcolm Gladwell, Hachette Audio

3.     “Outliers,” Malcolm Gladwell, Hachette Audio

4.     “Three Cups of Tea,” Greg Mortenson, Tantor Media

5.     “The Tipping Point,” Malcolm Gladwell, Hachette Audio

Monthly ‘Most Downloaded Books from the Library’ lists are also published at http://overdrive.com/mostdownloaded.

If you need any evidence of the popularity of eBooks in the library, all you need to do is look at what happened over the past week. Despite some issues caused by a surge in activity, traffic, checkouts, and new user registration records were smashed over the Christmas holiday–all thanks to eBooks.

For the first time ever, eBooks out-circulated audiobooks at libraries’ ‘Virtual Branch’ websites. Audiobooks are still very popular and increasing in circulation, but this momentum for eBook downloads shows that the format has gone mainstream at libraries.

Library eBook circulation has steadily grown over the past month, starting on Nov. 26, the day after the US Thanksgiving holiday. (Like Christmas, many people had new devices, thanks to Black Friday deals, plus they had time to use them.)

To show you what happened in one month, we’ve compared usage from Nov. 26-28 (around US Thanksgiving) to Dec. 25-27 (around Christmas).

eBook checkouts increased a staggering 93%
Visits to ‘Virtual Branch’ websites were up 60%
Pageviews were up nearly 70%

Needless to say, Christmas and the days following were the three biggest for library downloads ever. As a whole, 2010 was even more impressive. We’ll have the full stats for 2010 coming next week, so stay tuned.