February 10, 2012

Penguin U.S. abruptly stops selling ebooks to libraries


Protest art from a librarian at notallbits.wordpress.com

In a stunning development, Penguin has abruptly “stopped selling e-books to libraries,” according to an Associated Press wire story. As the report further explains, “Penguin announced Thursday it would stop selling e-books to libraries through OverDrive Inc., a Cleveland-based digital distributor and major supplier for the library market. ”

In November, Penguin had pulled its ebooks from Overdrive in an apparent slap at Amazon, which was getting Penguin ebooks from Overdrive for unauthorized use by the  Kindle Lending Library. (See the earlier MobyLives report.)

This time, though, the action seems aimed at frustration with libraries, with strangely arrogant timing: the announcement comes exactly one week after Random House delighted librarians across the country by announcing it would sell books to libraries with no restrictions on the amount of times they could be circulated (see the earlier MobyLives report) … and just days after a delegation from the American Library Association (ALA) visited Big Six executives in an attempt to negotiate a similar model industry-wide.

In a report about those meetings filed just two days ago on the ALA website, ALA President Molly Raphael says, “we reaffirmed our mutual desire to bring authors and readers together. Indeed, publishers and libraries enjoy a long history of productive relationships toward this end. There was ready acknowledgment of the key role that libraries and publishers play in society. And there was a desire for a mutually beneficial way forward for library e-book lending.”

Apparently, that desire was not as “mutual” as she thought.

A detailed report by Michael Kelly for Library Journal  notes that in the talks with the ALA, some publishers worried  …

… that if library loans become too “frictionless,” in other words, do not involve a physical trip to the library to borrow and return a book, that it will eat into their sales.

The desire to increase this friction may lead the recalcitrant publishers to demand a business model in which they will only make their ebooks available to public libraries if they are used in the library or if a patron is required to bring their device to the library and load the title onto the device in the library, then bring it home.

Kelly notes that both Overdrive and Penguin claim to be in negotiations on a new contract, “But since the company does not have a contract with 3M, the still fledgling but growing competitor to OverDrive, the practical effect of the decision will be to shut down public library access to additional Penguin ebook titles (not physical titles) for the immediate future.”

That means four out of the Big Six publishers — Simon & Schuster, Macmillan, Hachette, and now Penguin — have made their ebooks unavailable to libraries. HarperCollins makes its books available, but in a deal that restricts each ebook to 26 circulations — a deal that has been angrily criticized by librarians. Only Random House, with its own announcement last week, allows libraries unrestricted circulation of its ebooks.


Dennis Johnson is the founder of MobyLives, and the co-founder and co-publisher of Melville House.