or, The Hitchhiker’s Guide to Fear and Loathing at a Public Library Reference Desk

A Little Rant on the Current State of Ebooks

   March 10th, 2011

Rant = Open Mouth Insert FootI haven't been following the #hcod ebook topic as closely as I should be. But, my post earlier this week, a couple conversations I've had, and the ABC article with quotes from Kate, has prompted me to spell out what it is I don't like about what HarperCollins is doing - forgive me if someone else has already, and more succinctly, made these points.

I don't like a 26 checkout limit
The logic is that 26 checkouts is basically a year life span on a book, many books never get checked out 26 times anyway, and if a library does have to buy another copy after that, it'll be at a discounted "paperback" price. I dislike this because

  • 26 is pointless and arbitrary
  • if HarperCollins is allowed to set a 26 checkout limit now, what's to stop them a year from now saying, "according to our records, most ebooks only get checked out fewer than 13 times anyway, so we're lowering the limit from 26 to 13"
  • this kind of limit does not at all address the real threat to ebook sales - piracy. So far, attempts to fight piracy using DRM have succeeded in nothing but making digital content more difficult for honest people to use, and applying this kind of limit continues that tradition. DRM is a different conversation
  • in HarperCollins' Open Letter to Librarians, they say

    Selling e-books to libraries in perpetuity, if left unchanged, would undermine the emerging e-book eco-system...and in the end lead to a decrease in book sales and royalties paid to authors...

    The "in perpetuity" argument doesn't hold water because

    • no matter what, eventually demand for a book will fall off - regardless of whether a library has access to it or not. However, if a book stays in the library past peak demand, there remains the possibility of someone stumbling across it, enjoying it, and then seeking out additional books by that author. Self-destructing ebooks remove any chance for those future potential sales
    • new books are always coming out, so people are always making new purchases - this is where profits are made, and this is entirely unrelated to whether or not older books self-destruct

But really, it's not about a checkout limit at all
To me, it's not about the 26 checkouts - it's about owning something after you purchase it.

So far, all talk of ebooks has been about "buying" them, which implies ownership. Hence the huge uproar when Amazon deleted copies of 1984 that people had purchased, as those customers realized they had no ownership over the stuff they paid for.

And when we started buying downloadable audiobooks through Overdrive, it was always my understanding that anything we buy through them is ours, and if we leave Overdrive we can take it with us. That is what we've come to expect, because that is what we've been told - now HarperCollins is trying to change that. Taking away that right - ownership - is something I definitely see as worth fighting.

Libraries don't need to own everything we offer
Although I prefer outright ownership (like all the other books, CDs, DVDs, etc that we purchase), that isn't the only model we work with - all of our databases are just licensed, for instance.

If publishers want ebooks to be the same way - something we just pay for access to, but don't actually own - then fine, but they need to structure the market and mindset that way. They could sell licenses to access their "ebook catalog" and let people download them at will, just like database articles. Or, structure a model in which patrons get to browse the entire catalog and libraries pay per download, instead of "purchasing" titles up front and adding just those to our "library." There is definitely a license model that can work, but what HarperCollins came up with is not it.

So what ebook model will work?
One possibility I see with potential is the app store model. Smartphone apps are basically commodities, and sell very cheaply in huge numbers. Apps might only cost $0.99, but developers still can earn hundreds of thousands of dollars on them.

Ebooks could be sold the same way - instead of selling a few at $25 or more, selling a lot at a low price generates more revenue.

That price is also probably more in line with the actual cost of production, and is justified when you remove all the marketing the publishing industry does, and instead rely on the same kind of marketing that makes apps successful - good products thrive on word-of-mouth, and consumers seek out the niches they want. Lower ebook production cost should lead to more and varied ebooks, which fill more niches of peoples' interests, which means more opportunity for more authors to sell more books, thus higher sales.

What's holding up the progress?
I think core problem is that the shift from print to ebooks is a shift that doesn't translate well to the publishing industry's established sales channels and marketing programs. I'm not remotely an expert on the publishing industry, but it seems like they have a huge infrastructure in place to sell print books, and don't want to change. It's the same reason why energy companies have been so reluctant to explore alternative energy sources - they're comfortable with the infrastructure they have, so they defend it. It's more efficient for big businesses to be massive monocultures, rather than diddle with a variety of small and diverse avenues.

The publishing business model needs to be molded around how ebooks work, rather than try to fit the ebook peg into their existing print sales and marketing channel hole. Until they work that out, there will always be problems.

A prime example of this is another quote from in HarperCollins' Open Letter to Librarians:

If a library decides to repurchase an e-book later in the book's life, the price will be significantly lower as it will be pegged to a paperback price...

In the world of ebooks, there is no analogy to hardback and paperback - it's an ebook from day one forward, period. The fact that HarperCollins is still clinging to the old way of thinking about initial and secondary pricing structures - what they're familiar with - shows that they're not actually in a position to generate a new sustainable model.

To boycott or not to boycott
I support a boycott of HarperCollins because I disagree with their policy. I understand they are a business, and the only way to get a business' attention is to impact their bottom line - or, to vilify them in the public spotlight.

The catch is, I don't think libraries actually have as much purchasing power as people think - so the "attack the bottom line" approach might actually backfire if all libraries boycott them and their sales aren't really impacted.

But the more uproar we cause with this, the more it will be in the news, and the greater awareness the public will have about the shifting sands of ebook policy - not only in regards to libraries, but also the nature of ebooks overall.

Hopefully, it will highlight to people that they don't own the ebooks they buy either - which, I think, gives them less incentive to buy them at all, which in turn gives them more incentive to use library ebooks. This is where a significant drop in sales will occur - when people don't see the inflated price publishers are trying to charge for ebooks as a good enough value for something they are merely renting.

Which, of course, is why libraries need to have a place at the table while this ebook eco-system emerges. We do have a role to play, because the success or failure of ebooks in libraries depends on the buying preferences of our patrons. We must speak up, and cannot just roll over and let publishers dictate whatever policies that maximize their immediate profits to the exclusion of all else.

The future of small potatoes
Right now, ebooks are just a fraction of what libraries do. Granted, that is largely due to how difficult ebooks are to use, but still - it is an ever-growing area. And undoubtedly, digital and wireless are how services will be delivered in the future. The opportunity for libraries is to leverage our role as a pooled community resource, to purchase and make available those things patrons either can't or won't get on their own, and then deliver it in a way that suits them. That is the model we need to insist on.

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7 Responses to “A Little Rant on the Current State of Ebooks”

  1. Chris Says:

    First, I believe that everybody not in the Publishing business believes that Harper Collins is in the wrong. They are being ridiculous.

    I’m with you on the 99¢ price point, or even a little more for a new release ($1.50 / $2). Or base it on the number of words in the book. So are many authors. Amanda Hocking was recently in the news for making a killing on selling her self published books at Amazon for 99¢ a piece, and has 7 of the top 100 books on their Top 100 Paid stats. (As of 8-Mar-2011 anyway.) 26 of the spots are from Indie authors. Published author Joe Konrath has also been selling his latest for 99¢ and has a great interview with the current #1 Bestseller regarding his strategy.

    As a buyer, I balk at eBooks costing the same or more than their paperback or hardcover price. I imagine libraries do as well, especially knowing that it will be taken away from them after 26 loans. However, I’ve bought 10s of books on Amazon in the last 2 years at 99¢ with the thought that even if I don’t read them or read them right away, I’m not going to go bankrupt. Plus I might then find an author I enjoy and buy more of their books, which is precisely how I stumbled upon Konrath.

    Sorry for diverging from your original H-C topic, but I think you nailed the 99¢ price point discussion.

    Anyway, here are some relevant links

    Amazon Best Sellers:

    Amanda Hocking:

    Joe Konrath interview with John Locke

  2. Chris Says:

    And on a lighter note, at least one library is *celebrating* eBooks!


  3. Roberta Says:

    the limit annoyed me because it was so low. The *average* circ of our print collection is more than 20 times. If we have an item, effectively, for less than two years, that means we cannot build any depth to our ebook collection. No library’s budget permits them to replace any or all titles every two years. And because there is no interlibrary loan equivalent for ebooks, we can’t borrow any title we don’t own from anyone else either.

    I was happy to see an ereader roundup in Entertainment Weekly last week that commented specifically on the ability to borrow library books for each device. That was excellent PR for us!

  4. Chris Says:

    Roberta, I will admit that is one portion of my Kindle that I am unimpressed with. I would love to get eBooks for my Kindle from the library. I do not understand while the market leader in eBook hardware is shut out from lending.

  5. Brian Herzog Says:

    @Chris: Go to Hellman explains why the $0.99 ebook won’t happen. Publishers are middlemen, and only profit when it’s not easy for the actual producer (author) to address the consumer (reader) directly.

  6. Anne Says:

    The 26 check-out limit is oh-so conveniently one year’s worth of two-week checkouts. If libraries had to buy replacement copies of books every year, we’d be ridiculously hamstrung in providing a decent collection to our patrons.

    I think it’s total wank, and as you’ve stated here publishers need to rethink their pricing models. I like your idea of access to an entire library, and then fee per download. I’d rather offer our patrons a wider catalog of titles to choose from, than be limited to just the most popular titles available.

  7. Gamer Librarian Says:

    Chris, the “eBook hardware” SHUT ITSELF out from ebook lending. Ebooks are lent as EPUB files, which is a industry standard file format. Every ebook reader can open an EPUB file, with one and only one exception : The Kindle.

    If you want ebooks on your Kindle, it is Amazon you need to speak to. Good luck with that – Amazon appears to be using a proprietary ebook file format so that you and your ebook collection are tied to them for life, thus giving Amazon a monopoly on ebooks.