From the outset – or at least since the invention of the Kindle and the iPad – the e-book has been disrupting the lives of librarians and publishers. Why? From our research into the role of the e-book in Sweden we find a lack of a rational response to this new medium on both sides.
Everywhere, the e-book accounts for only a small proportion of total loans from public libraries – in Sweden it is about 2% – and yet the loan charges in Sweden result in budgetary problems for libraries. Any rational person would ask, What is the cost/benefit relationship for the expenditure? But librarians are driven by an ideology that says that, if a medium exists, it must be made available – and this ideology is now enshrined the Swedish library law. Neither law, nor government, however, say anything about where the money comes from to pay for the service.
For public libraries in Sweden, the question needs to be asked: are the benefits to society (i.e., those persons in the community who account for that 2% of loans) worth the budgetary costs and uncertainty. We doubt if any commercial organization would get into business on this basis.
The publishers are disrupted in a different way: their raison d’être is the publication of printed books. They know their market for such products and their entire business is founded on the printed book. A printed book is priced to recover the costs of production, distribution and author’s royalties. Consequently, the e-book is, for the most part, a by-product of the printed version – interactive, enhanced books have so far failed to make much of an impression on the market.
As a by-product, the cost of producing an e-version of the latest novel is negligible, by comparison with the costs already incurred in the production of the printed version. However, to sell the e-book at a price that would recover its specific costs of production would, they fear, cut into the sales of the printed version, from which their profits are derived. We have seen what happens when publishers raise the price of e-books on Amazon: their sales fall and the commentators seize on this as evidence that the e-book is in decline, when it is the publishers’ income from the product that is in decline.
We come to the conclusion that the publishers of printed books are not really interested in e-books: they have made little or no attempt to create a market for the product and, instead, have done everything to inhibit the growth of the market. Their fear is that self-publication could seriously eat into their profits and getting into the e-book market is little more than a defensive posture. Rationally, publishers should take a look at the market and the ratio of print sales to e-sales, and conclude that they have no role to play – unless they want to stimulate demand for e-books to the point at which they can benefit equally from print sales and e-sales. Like libraries, they need to consider whether the production of e-books is in their economic interest. Perhaps they are already doing so, as one commentator notes;
“The latest AAP report seems to show that major publishers are also working to kill off the eBook [as they have worked to kill off the digital editions of magazines]. This will be harder to accomplish because while the big name publishers control an impressive share of the print book market, their hold on the digital book market is less firm thanks to Amazon and self-publishing”. (Hebbard, 2016).
The situation is not helped by legal matters, which seem to be entirely confusing as the legal e-book status is quite undefined and oscilates between a computer file, a service, and a book as such. This concerns first of all the VAT issue that not only negatively affects practically all the actors in the field, but also helps the smartest to derive benefits by wriggling among different VAT rates in different countries. There are other possibilities of manipulation related to the same vagueness in calculating the authors’ royalties or other taxes.
The European Court of Justice is currently sitting over a case that deals with the question of “should lending of e-books be governed by the same rules as the lending of ‘classic’ printed books?” (Lovells, 2016). It is not a joke, as it is connected with the library lending a new copy of a book by creating a copy of the file on the reading device of a user, though the problem is far from new and has been encountered by digital journals and articles, and which clearly differs from lending the physical copy of a book to a user. The crazy thing is that a positive decision for libraries might lead to lending an e-book to one person at a time without the possibility of lending it to anyone else until it is returned by the previous reader, just as a traditional printed book.
Thus, having in our hands a dream product to promote reading and distribute information for all, we are going to kill it at root by treating it as an old product with all the limitations, instead of looking for innovative legal and business models that could satisfy all the actors. But it is a difficult job to make our brains work in unusual ways.
The most rational actors are individual authors and users (as long as they do not act as a group or corpus), though each one may see different benefits. They are looking for the solutions that help to reach their goals and satisfy their interests best, either by self-publishing or sticking to big publishers, reading for free and/or crowdsourcing an interesting book project or buying expensive hardbacks and enjoying the smell of new print.
Elena Maceviciute and Tom Wilson
Hebbard, D.B. (2016, August 1). Publishers (and vendors) killed off the digital edition, now they are working on eBooks, too. Talking New Media.
Lovells, H. (2016, July 6). Advocate General comments on lending e-books. Global Media and Communication Watch: blog.