Thursday, February 24, 2011

OverDrive and the Library eBook Convenience Paradox

The OverDrive iPad App, released just last week, is nice. Luckily, it's not TOO nice. Let me explain.

But first- a bit about OverDrive. OverDrive, the leading provider of ebooks in public libraries, has been battling some user experience issues. At last week's Tools of Change conference, librarian Katie Dunneback (@younglibrarian) went through the twenty-one steps a patron needs to take before they can read a library ePub book on their ebook reader. Kirk Biglione joked on Twitter that "it's actually easier to make an ePub file than it is to check one out of the library".

Once the initial configuration process is done, however, it's not so hard to start reading library stuff in the Overdrive App (actual name: "OverDrive Media Console"). I find Overdrive's discovery interface- which is a website and not part of the app- to be a bit mystifying. For my local library, which gets Overdrive books through the "ListenNJ" consortium, the main problem is finding an ebook I want to read that hasn't already been checked out.  The growing popularity of ebooks  is such that most of the ebooks are checked out, and since these use the "Pretend-It's-Print" model, I can't read them when someone else is doing so. Worse, the Overdrive website doesn't let me browse just the books that are available. Do people really exist who want to browse books that are checked out?

The browse interface also mixes up audio books with ebooks. I think most users want one or the other. It lets you sort by "creator" (Do real people know what a "creator" is?) but it doesn't provide a list of creators to browse. Granted, most library websites don't do much better, but isn't that why they still have stacks to wander?

Luckily, Overdrive also distributes public domain books from Project Gutenberg. These have the magical property that a new copy appears on my library's e-bookshelves as soon as one is checked out, like the milk cartons that get restocked from the rear in my grocer's refrigerator. If there were Creative-Commons licensed "unglued ebooks" in the library, they would behave the same way.

Although the public domain ebooks are a real godsend, the Overdrive website handles these clunkily, too. When I first searched for "Moby Dick" I found only a Penguin "enhanced" ebook version that was already checked out. I had to do a separate search in the Project Gutenberg section to discover the public domain Moby Dick that's always available.

Star Wars: Fate of the Jedi: OmenThe OverDrive iPad app itself delivers a nice reading experience. There's a single app that works on both iPhone and iPad - if you already had the iPhone version, you just need to update it. It's not as slick as some e-bookstore apps, but pretty good for a first version. And the books are quite readable. I borrowed Christie Golden's Omen, a Star Wars novel. The reading experience is on par with the Kindle App; I particularly liked the positional indicators: OverDrive's "7 pages left in chapter" is much more helpful than the Kindle App's "Location 3013-3019 --- 44%". The best part of the process was I was sitting in a ski lodge 259 miles away from my library.

Despite the the website issues, this whole lending thing seems great all around. Library patrons like me get to read books from the library in our preferred environment. We're exposed, without risk, to a variety of books we might not have considered acquiring on our own. And apart from feeling obligated to support our library when the friends group asks for money or raising our voices when the municipal budget gets cut, it doesn't cost us anything.

So what's the problem? Why am I going around showing demand curves and mathematical inequalities, claiming that lending ebooks doesn't create economic value like it's some mathematical proof or something?

In doing that, I'm guilty of some oversimplification. So now I'm going to show you yet another demand curve and recomplexify everything for you.

Remember print books? Let's review the book industry's method of squeezing every last dollar out of a book's demand curve. It's done by segmenting the market. When a hot new book comes out, it's a hard-cover that costs maybe $30. The people who buy the book are those that value it the most and the truly impatient. If the book is successful as a hard cover, then maybe a year later it comes out as a softcover priced at $12.95. A whole new wave of purchasers buy and read the book. The hardcover and softcover markets are segmented because they attract a different audience. Consumers perceive this as fair because the softcover feels like an inferior product, even though the manufacturing cost differences are quite small.

Consumers who don't even want to pay for a softcover are served by libraries and used book stores. Although it doesn't cost anything to borrow a library book, you may have to wait for it to be available, you have to get yourself to the library, and when you're finished with it, you have to take it back. Instead of the cover price, you pay the price of time and inconvenience.

Another form of market segmentation is accomplished by splitting regional rights. A book might be priced lower in India than in the US (and higher in the UK) because consumers in each country have somewhat different expectations as to what a book should cost.

Market segmentation is harder to achieve with ebooks. You can't put a hard cover on an ebook, and price differences are harder to sustain across national boundaries when the commodity is purely digital. A publisher can drop the price of an ebook with time after publication, but this can be hard to do because of supply chain issues, author royalty contracts, and consumer perceptions of value.

The library ebook distribution channel presents another opportunity for market segmentation. Libraries "buy" the ebooks, resulting in revenue for rights holders. Consumers can read the books without paying for them, but they have to be willing to put up with 21 step configurations and account IDs, and face the possibility that a book might not be available right away and may have a long lending queue. At least with ebooks, there's not the inconvenience of going to the library again to return the book at the end of the lending period!

But imagine if the Overdrive website made it as easy to find and borrow a book  as Amazon's makes it to get a Kindle Edition. Imagine that you didn't need an Adobe ID separate from your library card number. What would happen to the inconvenience barrier that allows publishers to still capture the high end of the price curve at full price? It seems clear to me that without the inconvenience barrier, publishers would quickly remove their desirable content from library lending programs to protect their retail sales.

So here's the paradox: libraries can only be successful at ebook lending if they do a bad job of it.

While I don't think it's tenable over the long term for libraries to specialize in inconvenience, I still think it's very important for libraries to be offering ebooks through services such as Overdrive. Even if the lending models of today turn out to be transitional, they help everyone involved become comfortable with library ebooks. Once the library ebook experience becomes embedded in our everyday lives, readers, publishers, authors and librarians will be able to recognize the novel digital distribution models that benefit everyone.

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11 comments:

  1. A few misc. points

    - Here in the UK we actually have legislation that says a person lending an ebook from a library has to actually go to the library to get it, publishers have so far though not used this on overdrive

    - ebook lending is crap, it disappears when your loan is up, you can't leave it festering at your leisure and pay the fine when you're done ;)

    - I've heard things about overdrive like you can only take so many books out at once, but you can't return early to exchange a book?

    - It looks roughly as though it is the same cost to buy a paperback as make a book available on overdrive for a library's public, although I'm told it gets cheaper the more books a library has on overdrive -- essentially though ebooks at your public library may serve, e.g., the purpose of making a best seller available while it is in fashion, but not for the purpose of a comprehensive collection

    - Haven't heard anything of Google's book scanning enterprise recently! (Libraries do not need to duplicate, so may have to respond to this.)

    - A bit of tough love I think may be needed to be used on publishers, for the good of Humanity; if they can't work the business model out for libraries to continue, then the government is going to have to do this (my opinion, probably won't ever happen though ;)

    - The reason I don't use overdrive yet is 'cos I'm too stressed to figure out how to login (can we have some library courses please?) and I doubt given they only have a few books and for best selling stuff there will be anything I could use or might catch my interest otherwise

    - ebooks I think are somewhat a red herring to an extent until the benefits can be realised - instant access, at any time, from anywhere, using technology that is widespread, to the World's literature - all of it, without exception, and at 20% of the cost of the paper book (if librarians need to they should go back to the grindstone and remind everyone why this is important; there is no reason that publishers cannot figure out the business plan necessary, so no excuses there - if the economics no longer serve the age we are in, then things change)

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  2. Excellent post.

    For what it's worth, I'd say "libraries can only be successful at LENDING if they do a bad job of it" has always been true—and this isn't bad!

    What do I mean? Well, public libraries have always been less convenient than plucking a book of your shelf at home--and not having to return it. And libraries have always been less convenient when it comes to getting a bestseller; bookstores generally don't run out of copies of a new book, but libraries often do. This state of affairs has ensured the continued existence of libraries. If libraries had infinite copies of books (without paying for infinite copies), could get them to your home in thirty seconds flat, and didn't require you to return them, people would stop buying books entirely, publishing would collapse—and then laws would be rewritten to stop it!

    What do public libraries really provide? What is their core service? As I see it they provide NOT convenience, but a certain basic level of availability. That value is low enough that it doesn't kill publishing, or produce laws restraining libraries. And it's high enough that everyone in their service area can experience a world of information and entertainment, provided they're willing to suffer some inconvenience to get it.

    Ebooks set that sitaution awobble. They make book buying easier. They get rid of the space problem. And patrons expect libraries to deliver free ebooks to them at home as easily as buying it online. As one of your blog commentors said in response to the British publishers' decision to require library visits, "An electronic library that you have to physically visit in order to see the books is the dumbest kind of dumb."

    Well, long live dumb. And long live inconvenience. Libraries change lives. They change it because of what they offer--the limitless possibilities they open up--not, ultimately, how convenient they are.

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  3. "the Overdrive website doesn't let me browse just the books that are available."

    Not so. Go to the Advanced Search screen, select "ePub" for the format, and check the box labeled "Only show titles with copies available."

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  4. Long live inconvenience, indeed. However, when the inconvenience renders the service unusable (or nearly so), that's a different story.

    For example, I can't deal with Overdrive's two week loan limit. I simply take longer to read most of the books I want to read. Furthermore, I often want to read current books, which will have holds on them, and be unavailable to re-check out once they expire. I'm sorry, I'll wait in queue for a new book, but I'm not going to read in fragmented two week increments. (And yes, I realize the same dilemma applies to current/bestselling print books in libraries, too..)

    So, this is why I got a Kindle instead of an Overdrive-compatible reader. I figured if I'm going to have to purchase most stuff I want to read anyway, I might as well go with the best device.

    Tolerating SOME inconvenience is what it's all about. But library ebook lending simply has to get better! There must be some sort of a balance we can strike here.

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  5. Sharon- there's no "Advanced Search" screen that I can find on the mobile version of the ListenNJ Overdrive site, which is what I get browsing with the iPad. It lets me browse only ePub, or by genre, but it won't let me browse ePub by genre.

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  6. And, in other news, OverDrive says that one of its publishing partners is requiring them to implement "checkout limits" on its books. I guess the iPad app really WAS too good. Librarian by Day has the story.

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  7. "Worse, the Overdrive website doesn't let me browse just the books that are available. Do people really exist who want to browse books that are checked out?"

    Have you used "advanced search"? It allows you to toggle show available books only.

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  8. So much going on here... a few comments:

    the publisher complaints about the Amazon $9.99 pricing for Kindle books doesn't have to do with what the publishers earn (Amazon eats any loss due to the lower price), but their fear that customers will begin to see $9.99 as the "right price" for a book, thus making it hard to sell books of any format for more than that. This is the same thing that Apple has done to the music market, where $.99 is now the accepted price for a "tune". What's upsetting the market isn't *just* that Amazon and Apple provide lots of product in a convenient format but that these companies are so much bigger and more profitable than the publishers that they can undercut industry prices and thus completely undermine the bottom-line that publishers live by, thus changing that industry from the outside.

    As for the role of libraries, libraries began as the archives of civilization's intellectual output, not as competitors for popular entertainment. US libraries didn't start carrying "popular" fiction (also known as "the devil's workshop") until well into the 1920's in the US. [1] Adding music (other than classical, of course), movies (other than serious documentaries) and -- *gasp* -- comic books have all been huge controversies. I am well aware that if libraries went back to the 19th century concept of monitors of "culture" they'd be about as popular as a dental instruments museum. Yet it's clear that they can't begin to compete with Amazon, Google, etc. Finding the right niche for them isn't easy, but they are still the only institutions that are committed to preservation and curation, not *just* customer popularity.

    [1] Recommended reading: Dee Garrison, Apostles of Culture.
    http://openlibrary.org/works/OL4640774W/Apostles_of_culture
    aka
    http://www.librarything.com/work/566676

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  9. You wrote:

    "Consumers who don't even want to pay for a softcover are served by libraries and used book stores."

    Let's not forget consumers who *can't* pay for a book of any kind.

    I don't take a back seat to anyone on arguing that publishers and content creators should be fairly compensated for their work, but excess friction (especially of the 'false scarcity variety Harper Collins is attempting to create) seems to ignore the needs of their customers...in this case the libraries and their patrons.

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  10. you could totally put a hard cover on an ebook. just have a physical media digital release. stick the epub and protections unto an extremely small memory stick and release it like a DS game, with a standardized memory type that all ereaders accept. with the rejection of the PSP go, it's obvious consumers value physical media, much like they value the hardness of the hardcover.

    @Don in capitalism, I don't think consumers without money are consumers, or customers at all.

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  11. OK, I retweeted it, but I still don't buy it. That is to say, I don't think the buying behavior of heavy readers is influenced by difficulty. I buy what I like, and I like what I've borrowed. The easier it is for me to borrow, the more I read, the more I read, the more I buy. Removing an easy loan won't make me buy.

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