Macmillan Publishers is now changing the terms on which it sells digital content to libraries.
Macmillan CEO John Sargent sent out a memo (addressed to authors, illustrators, and agents), that starting on Nov. 1, 2019, Macmillan will begin a two month embargo on all e-books to public libraries.
Under the publisher’s new digital terms of sale for libraries, they will now be allowed to purchase only one perpetual access e-book during the first eight weeks of publication for each new Macmillan release, at half price ($30).
Additional copies will then be available at full price (generally $60 for new releases) after the eight-week window has passed. All other terms remain the same: e-book licenses will continue to be metered for two years or 52 lends, whichever comes first, on a one copy/one user model.
“It seems that given a choice between a purchase of an e-book for $12.99 or a frictionless lend for free, the American e-book reader is starting to lean heavily toward free,” Sargent wrote. “Our new terms are designed to protect the value of your books during their first format publication. But they also ensure that the mission of libraries is supported.”
MORE: PHOTOS: More than 2K UD freshmen move in
He said that Macmillan has growing fears that library lending is cannibalizing sales. Sargent noted that the growth in e-book lends through libraries has been remarkable.
For Macmillan, 45% of the e-book reads in the US are now being borrowed for free from libraries, according to the company’s research.
The average revenue we get from those library reads (after the wholesaler share) is well under $2 and dropping, according to Sargent.
“The increase in library e-book reading is driven by a number of factors: a seamless delivery of e-books to reading devices and apps (there is no friction in e-lending, particularly compared to physical book lending), the active marketing by various parties to turn purchasers into borrowers, and apps that support lending across libraries regardless of residence (including borrowing from libraries in different states and countries), to name a few,” Sargent explained.
Libraries see it differently and believe lending helps the industry
Executive Director of the Dayton Metro Library Tim Kambitsch said the e-book and e-audiobook issue has been brewing for a while, but has accelerated substantially in the past few months with Macmillan announcing its plans to institute a two-month embargo.
Kambitsch said the letter to publishers and authors sent by Sargent is short on facts, and despite the claim about communicating with the library community, their (publishers) actions were unilateral.
“The library community has not had meaningful conversations with them and they have failed to provide data to support their claims,” he said. “Their decision to limit one copy during the embargo period for all libraries is a good illustration of them acting in a vacuum.”
He posed an interesting question: “Who sees as fair or logical a policy that allows one copy for the little library in West Milton Ohio, one copy for all 460,000 residents in the Dayton Metro Library service area, and one copy for the millions served by the New York Public Library? They seem particularly deaf to arguments about equity.”
MORE: How will Foundation funds for Dayton shooting victims, survivors be distributed?
He said Macmillan’s letter irked a lot of librarians in that it implied that libraries were taking money out of the pockets of authors.
“I want to underscore that libraries, authors and publishers need each other. We are a huge recommendation engine for authors,” Kambitsch said. “Our collections are filled with little know authors who get exposure from people browsing their shelves. We offer titles that will never be seen in the chain bookstores. Libraries are a huge market for publishers and a huge part of publisher profits.
Kristi Hale, director of the Wright Memorial Public Library in Oakwood, explained that multiple publishers have recently changed their digital content sales model for libraries that will result in soaring costs and delayed access to new titles for library patrons.
“Wright Library’s e-book and e-audiobook usage has skyrocketed. Wright Library circulated 30,000 e-books and 18,000 e-audiobooks in 2018, and we are showing a 25% increase this year,” Hale said. “These publisher changes are going to limit our ability to provide our patrons with the information and content they want and expect.”
MORE: Dayton United to promote community healing and raise funds through music, shopping, brunch and more
What happens now?
Karl Colón, executive director of the Greene County Public Library and member of the Ohio Library Council Government Relations Committee, which analyzes legislative issues affecting the state’s library operations, says that Greene County is part of a digital download buying cooperative with other libraries.
“We will actually be meeting to discuss this and talk about how we can work cooperatively across the state and with the American Library Association to address these publishers issues,” he said. “Tim Kambitsch has come out and addressed these issues and he’s right. It affects us a little differently because we are part of this large buying cooperative, but those issues will come home to us.”
Colón said he understands that publishers need to make money, but said the system needs to ensure public access.
“The very nature of the copyright act was created to ensure access to intellectual ideas and material,” he said. “What we have to do is to make sure that are publishers are getting taken care of responsibly, but in a way that guarantees the public’s right of access.”
MORE: Two fine exports from Yellow Springs are coming to downtown Dayton, for 1 night only
Michelle Francis, executive director of the Ohio Library Council, said she would like to see all five of the major publishers, (Penguin Random House, Simon & Shuster, Macmillan, Hatchette Group, Harper Collins) as well as their subsididaries work with libraries in order to guarantee access for patrons to material, while also making sure there is fair compensation received by the publishers.
“Sometimes the publishers are charging three or four times what the actual cost is for some of the material,” she said. “Libraries are willing to pay a fair price for access in order to provide access for patrons. Ohioans pay us tax dollars to allow them access to information.”
Francis said that she is hopeful things will get resolved, but is not optimistic they will get settled right away.
“Ohio libraries have the highest use per capita in the nation not just for just downloads and materials streamed - it’s actually the totality of all services. Last year alone, Ohioans borrowed physical items (books and other items) and downloaded and streamed materials approximately 195 million times for all materials. Of that, 22.7 million was from eBooks and eAudiobooks.”
Steve Potash, the president and CEO of OverDrive, which is an international company based in Ohio that helps public libraries deliver digital content to patrons said access is “essential.”
“We believe access to digital content at affordable prices and terms is essential to the continued growth of library usage, which benefits all parties including authors, publishers, and the library community,” Potash posted on his blog.
MORE: Dayton shooter had mental healthcare receipts with him when shot to death