Monday, February 28, 2011

Why HarperCollins decision to limit their ebook lending will not help their ebook sales

HarperCollins announced last week that new titles licensed from library ebook vendors will be able to circulate only 26 times before the license expires. This is the first time a publisher is restricting the use of e-books in libraries - so far, as the NYT explained yesterday, libraries that have paid for the privilege of making a publisher’s e-books available for borrowing have typically been granted the right to lend an e-book an unlimited number of times. What it means for many libraries.

HarperCollins explained in a statement they " believe this change balances the value libraries get from our titles with the need to protect our authors and ensure a presence in public libraries and the communities they serve for years to come."

HarperCollins clearly wants to limit sure ebook lending so it won't jeopardize its ebook sales, but are they taking the right step? At least from a business point of view, I believe the answer is No.

HarperCollins are definitely right that it's much easier to borrow an ebook than a paper book - you don't even have to go to the library. Many times you can just go to your library's website and get the requested ebook in a minute or two without leaving your chair for a second. This convenience is observed by HarperCollins as a threat to their ebook business - if it's so easy, wouldn't a growing number of people choose to do it instead of buying the ebook?

The answer is probably Yes, but the problem of HaperCollins is that they can't stop it by limiting the number of times libraries can loan their ebooks.

Why? Because libraries are not the only ones lending ebooks. With both the Nook and the Kindle providing the option to borrow and lend ebooks for two weeks, we see a growing number of websites that provide convenient platform for readers to exchange ebooks. Today you have websites such as, Books for My Kindle, Books for My Nook and (not operating yet), where you can borrow and lend ebooks easily and for free.

Now, I'm not sure if HarperCollins' restrictions will apply also to individual lending, but even if this is the case, with a growing number of exchange platforms and users, these restrictions will become meaningless. You can stop tens of thousands of libraries, but you can't stop millions of ebook readers that would like to borrow and lend books to each other.

The bottom line is that HarperCollins not only made libraries rightfully angry, but to my opinion also made a poor decision from a business point of view. If they want to increase their ebook sales, they need to look for real creative marketing ideas and forget about limiting the lending options of their ebooks.

Raz @ Eco-Libris

Eco-Libris: Promoting sustainable reading!