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Simon & Schuster Joins ‘Big 6’ in Moving Ebooks Into Libraries
Posted On April 25, 2013
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On April 15, 2013, Simon & Schuster (S&S) became the last of the “Big Six” (now actually five with the merger of Random House and Penguin) publishers to dip their toes into the waters of ebook sales to libraries. The ebook publishing horizon is still very uncertain—from publishing through distribution—as companies work to test new business models in this rapidly changing arena; however, all of the major mass-market players are finally in the game. The recently announced S&S pilot deal involves only The New York Public Library, Queens Library, and Brooklyn Public Library, at least initially; but the trial offers some interesting twists and opportunities for libraries.

Publishers Versus Libraries

In what’s been described as an “ebook Tug of War” in the press, publishers are still trying to figure out their role—and that of libraries—in the new publishing ecosystem. So far, libraries have been on the receiving side of volley after volley of attacks and impossible contractual terms from publishers. “In their eyes,” according to a New York Times article, “borrowing an ebook from a library has been too easy. Worried that people will click to borrow an ebook from a library rather than click to buy it, almost all major publishers in the United States now block libraries’ access to the ebook form of either all of their titles or their most recently published ones.”

From the library trenches, led by the American Library Association (ALA) through its various divisions and its Digital Content & Libraries Working Group, librarians have been seeking common ground. Meetings with publishers have been one approach that may be bearing fruit. In January 2012, ALA officials met with Big Six representatives where, in the words of then-ALA President Molly Raphael, “[W]e explored possibilities for collaboration to conceptualize and develop business models and improve everyone’s understanding of how library ebook lending advances the marketability and availability of titles for all. Indeed, some distributors have library ebook lending pilots planned in the near future toward that end.”

Some of these informational efforts appear to be working as publishers—even beyond the Big Six—and now seem committed to test new models for distribution to libraries. However, many publishers, including Norton and Scholastic, remain on the sidelines preferring not to sell ebooks to libraries.

Moving to Active Engagement

Things are changing rapidly in this area, and contracts and pricing models are enough to confound the experts, let alone the novices in this area. Jo Budler, Kansas’ state librarian and champion of library rights in this area, maintains a Facebook page in which she tries to keep up with ebook terms. [See screenshot.] “Writing to publishers and complaining to each other about the publisher/library ebook conflict wasn’t enough,” Budler noted in a press statement. “We needed a (social media) platform of our own to come together with the public and really take a look at the content not available.” The page is liked by nearly 1,700 people.

However, ALA is taking actions that are more direct. Ebooks have spurred a move from a basically traditional passive stance to advocacy and sustained engagement with publishers and other key stakeholders pressing for access and change. Under the presidencies of both Molly Rafael and Maureen Sullivan, ALA has clearly stepped out of a rather conservative role to one that stresses active involvement and information campaigns with local groups, state-level, and national efforts to inform and sway public opinion. ALA has also established a blog and website to help librarians better prepare for assertive efforts to communicate their needs and that of their communities. “Working together,” says Sullivan, “I know that we can resolve the current impasse and ensure that ebooks are available to all library users in all our communities at a fair and affordable price.”

A year ago, then-president Rafael and other ALA officials met with key publishers; Rafael noted that “it was agreed that we—publishers, libraries, intermediaries, and others—operate in an ecosystem that is experiencing profound change. ... Much work remains to fully grasp the rapidly changing context of digital content and libraries and to converge on solutions that all key stakeholders can live with. We must find these solutions so that libraries can continue to provide the best possible service to their communities.”

Last week, Sullivan reported on new meetings with “a number of key players in the publishing ecosystem.” This included “substantive conversations” with publishers where “we did not agree on every point, but we left with avenues to consider and pursue.”

Sullivan added that, “once we are in the room with leaders in the publishing industry or related organizations, additional common areas of interest emerge. These lead to new opportunities for ALA and the library community.” One of these ideas is evident in the new S&S trial with selected New York public libraries.

Innovative S&S Terms

In announcing what they hope is a landmark agreement, which begins April 30, S&S president and CEO Carolyn Reidy explained that the company was “delighted to partner with these libraries, which have shown an extraordinary willingness to try innovative models with the potential to be a long-term solution for all involved. In making our full list available, we think we will get a better sense of lending patterns and patron behavior, and I am particularly eager to start seeing the actual data so that we can better understand this still-new phenomenon.”

Terms of the pilot program are that “the participating libraries can acquire any S&S ebook title at any time during the pilot’s one-year term, with each title usable for one year from the date of purchase. Each library can offer an unlimited number of checkouts during the one-year term for which it has purchased a copy; each copy may only be checked out by one user at a time.” All of S&S’s frontlist and backlist ebooks titles are included, “with new titles being made available simultaneous with their publication. As part of this pilot, The New York Public Library, Brooklyn Public Library, and Queens Library are offering patrons the option to purchase a copy of Simon & Schuster ebooks from within the libraries’ online portals. Since the libraries will receive a share of the proceeds from each sale, this new service offers patrons the opportunity to support their local libraries, particularly for popular new titles with long waiting lists. If successful, the program could be implemented with other library systems across the United States.”

S&S sees opportunities to better understand evolving markets. Reidy said, “[W]e have always recognized the important place of libraries in our communities. They play a vital role in fostering and encouraging reading in every strata of our society, and they help to create an audience for our books and authors.”

For Queens Library president and CEO Thomas W. Galante, “this bold new program is an important step in the right direction. It not only gives our customers access to some of the hottest titles; it also offers an innovation to allow patrons to purchase titles and support the library at the same time. It’s a win for everyone.”

Libraries involved in the pilot expressed strong interest in looking at new models and avenues connecting people and information. “This is a path breaking step that will ensure that as ebook readership grows, our citizens can enjoy access to books akin to what the library has always provided," explained New York Public Library president Tony Marx. "Publishers win by growing their audience and readers win with more ebooks to borrow.” And for libraries, this opens the door to new opportunities and roles.

Keeping Up With the Big 6

Because of their size and influence in the publishing arena, the Big 6 have been important to getting ebooks into libraries—here and abroad. With S&S giving libraries another opportunity, it is worth looking at the status of all Big 6 publishers’ arrangements with libraries.

HarperCollins initiated a 26-checkout limit per ebook copy in early 2011, with no time expirations on copies and allowing for libraries to acquire ebooks at the time of print publication. A year after this arrangement was implemented, Josh Marwell, Harper’s president of sales, noted that “we still think our decision was the right one because it fulfills our goal of continuing to make ebooks available to libraries at the same time speaking to our concern about how increasingly frictionless library borrowing could affect the emerging ebook ecosystem.”

In 2011, Penguin famously (or infamously) decided to stop selling new ebooks to libraries due to “concerns about the security of digital editions,” also ending its relationship with OverDrive and distribution to libraries via Kindle. On March 28, 2013, Penguin announced a trial scheme in which library ebook prices will be comparable to retail, with libraries needing to buy a new copy of each ebook annually—and regardless of the number of checkouts of any given title. However, titles will be available at the time of general release. Penguin’s announcement indicated that the company had been tracking ebook checkouts at libraries to make sure they are not cutting into paid book sales, finding that “the effect of library downloads on commercial revenues has been acceptable.”

So, the publisher was willing to try another trial: “Penguin is proud to make all of our ebooks available to library patrons,” Penguin vice president Tim McCall noted in the press release: “After careful examination of our pilot programs, we are ready to take the next step and offer what consumers and libraries have been asking for, thus fulfilling our mission to bring new writers to readers.” Other terms remain basically the same: Libraries are able to purchase titles at basically retail prices and can circulate each purchased copy to only one patron at a time for a period of 1 year; after this time, libraries would have to buy another copy.

A year ago, Random House moved to raise ebook prices to libraries by as much as 300%. Today, pricing to libraries average about three times the consumer pricing; however, titles are available at the time of print publication, and there is no limit on number of circulations or any additional, annual fees.

Hachette decided last fall to force libraries to pay an average of more than 200% more for their ebooks—and their offer would not include any “new” titles, just a backlist of ebooks generally published before April 2010. The move “stunned” ALA’s president, who noted that “libraries must have the ability to purchase a wide range of digital content at a fair price so that all readers have full access to our world’s creative and cultural resources, especially the many millions who depend on libraries as their only source of reading material.”

Macmillan, through its Palgrave subsidiary, makes some ebook titles available to academic and professional markets. In January 2013, the company announced it would offer popular ebook titles, limited to 1,200 older titles from the Minotaur Books mystery and crime fiction series, through distributors to largely public libraries, which will be able to lend out the ebooks for 2 years or 52 times, whichever comes first, before needing to buy a new copy. Initial reports said the average ebook price would be $25. This will work in a modified agency model, working with multiple distributors, including Axis 360, OverDrive, and the 3M Cloud Library in largely public library markets. Others report that Macmillan will offer a pay-for-perpetual-use option as well.

Distribution and platforms remain an issue as some publishers continue to support some vendors and not others. Individual publishers and vendors like OverDrive, ebrary, and EBSCO Publishing, offer platforms that are not interchangeable or particularly user-friendly. Publishers, still working out preferred distribution, often make their publications available through some vendors while ignoring other potential outlets. Penguin’s ebooks offered to libraries, for example, are not available for Kindle users, since Baker & Taylor and 3M do not support that format. Getting major publishers onboard with some level of commitment to the library marketplace is a major step, but clearly, there is much work yet to be done.

A Future of Better Possibilities

“It is not only pricing which is hindering access to downloadable ebooks through libraries,” Budler says. “[I]t is also the refusal of some of the publishers to sell or lease copies to libraries. For some reason publishers believe that if a person can get an ebook from the library, no one will ever buy that title. It has never happened like that with print or books on CD or books on tape. I am probably a perfect example of this when it comes to knitting books. Every single knitting book I have bought in the past few years (and there have been dozens of them!), I bought after checking it out of the public library. They were NOT available in any bookstore; I discovered them at the library and the sale was made!”

Just last December, bloggers were celebrating the back-door arrangement that, in effect, forced S&S to make an ebook available to libraries. That back door was the agreement between the Iowa Center for the Book and publishers that whichever book is selected for the All Iowa Reads program is then made available to libraries to encourage reading. At that time, S&S’s director of marketing noted that, “[W]e are in a little bit of limbo about having the ebook available in libraries. This is not our policy as a general rule, but ...” From that awkward moment to today’s pilot, S&S has clearly taken a major step in the right direction.

Actively engaging in substantive conversations is a major step from the intransigence that has marked publisher/library relationships on ebooks to date. Sullivan believes we have reached an important milestone that will allow for more synergistic sharing: “Once we are in the room with leaders in the publishing industry or related organizations, additional common areas of interest emerge. These lead to new opportunities for ALA and the library community.” Clearly this effort on the part of ALA officials shows the organization more willing to take assertive, decisive steps to support their members and their constituents.

Industry insider, Mike Shatzkin, notes that most publishers are troubled by the idea that “if it were just as easy to get ebooks from libraries as it is from retailers, over time more and more customers would migrate to the libraries. But, the more I think about it, the less I accept the notion that total withdrawal from the library market is necessary to create a clear advantage for the retailer as a destination for ebook readers. In fact, it is possible that putting ebooks into libraries, in the right ways, could increase sales at retail. And the only way for publishers to find that out is to do some controlled experimentation in that marketplace.”

Thankfully, we are finally at the point in which we can begin to collaborate with publishing partners on programs to create workable solutions and opportunities for readers and libraries—and a better business model for publishers themselves in the new 21st-century publishing ecosystem. 

Nancy K. Herther is a research consultant and writer who recently retired from a 30-year career in academic libraries.

Email Nancy K. Herther

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