Amazon Patent Digital 'Used' MarketPlace

The first sale doctrine which currently restricts the resale of digital files and in doing so obviates the second hand market, has always been suspect and now looks like its about to be tested even further by another piece of the evolving Amazon jigsaw.  

The abstract below is from a US patent filed by Amazon in May 2009 and just granted in January 2013.

Abstract

An electronic marketplace for used digital objects is disclosed. Digital objects including e-books, audio, video, computer applications, etc., purchased from an original vendor by a user are stored in a user's personalized data store. Content in a personalized data store may be accessible to the user via transfer such as moving, streaming, or download. When the user no longer desires to retain the right to access the now-used digital content, the user may move the used digital content to another user's personalized data store when permissible and the used digital content is deleted from the originating user's personalized data store. When a digital object exceeds a threshold number of moves or downloads, the ability to move may be deemed impermissible and suspended or terminated. Additionally or alternatively, a collection of objects may be assembled from individual digital objects stored in the personalized data stores of different users, and moved to a user's personalized data store.

What does it mean to ‘used’ digital media such as music and ebooks is not clear today. We still have legal rulings to be declared in the ReDigi US case and we have the same company declaring its intent to come to Europe to resell digital music this year. Now we have Amazon holding a patent, which like ‘one click’ could restrict others whilst opening up a market that has been threatened for so long, yet ignored by so many.

Not all patents convert and many sit in drawers. Amazon’s intent today is unclear and whether this was just to cover their lending programme, or is intended to cover full resale’s. Today their contracts restrict players such as ReDigi from using their files , but does this mean that they have been planning a further extension to their ‘walled garden’ all along?

Can this patent be used against others such as Redigi, or be used by them to support resales?

How will this piece of the Amazon jigsaw fit with the other significant pieces such as; Prime, FreeTime, Autorip, Lending, KDP etc?

The one thing that is very clear is that one company is building a jigsaw and can envisage the picture whilst others are merely tinkering with the individual pieces and the edges.

US patent detail

Digital Library Fallout Continues

The above poster comes from Sarah Houghton, who is the Acting Director for the San Rafael Public Library, Calofornia and writes a blog Librarian in Black. In frustration to the current non supply of some major publisher's ebook titles, Houghton had posted the notice on her library wall.

Yesterday, Penguin added fuel to the debate when it announced that they have effectively shutting down their ebook relationship with the major digital public library service provider, Overdrive. We find ourselves now asking many questions about the state of digital public library support from publishers and the thorny issue of the ebook rent and loan business models.

Why are some refusing to allow public libraries to loan out their ebooks which are freely available to buy in the market? Why has Penguin withdrawn its ebooks from the Overdrive digital library service? Why has a prominent group of major publishers refused to supply ebooks to public libraries? Why did HarperCollins previously invent a rule that said ebooks wear out after the same number of loans as their physical counterparts and must be bought again? Why are some insisting that library lending has to be done physically in the library and not over the networks?

If we look at the public library we see the friction many predicted between publishers and the libraries over digital content. You can wrap it up many ways, but at the heart lies commerce and the challenges of download to buy versus loan for free. If libraries seize the opportunity to loan ebooks and appeal to a wider and larger audience they could undermine today’s revenue streams. If they don’t seize the digital opportunity and remain wedded in the physical world they could spiral into obsolescence.

Some would suggest that libraries charge for ebook rentals and also sell downloads, but does this work against their public principles. Some would ask why publishers aren’t renting books out direct themselves and why we are still wedded to the ‘ownership’ model in a virtual world? If there were to be a significant shift in market demand, do publishers have rental models that would hold water?

Some like Bloomsbury Online are quietly forging library relationships and moving forward, whilst others appear to be standing firm behind the barricades and not moving.

The Overdrive service is not new and it is the dominant provider to public libraries today, not just in the US, but increasingly in many countries. The libraries like the retailers have left it to third parties to invest and provide the common platform and repository. Was this wise, – probably not? Was it inevitable given the funding, – probably? However, we are were we are and it isn’t going to change for some time.

The tragedy is that these battles are being fought in public at a time when we all try to help reposition the public library in the face of disruptive change, spending cuts and even closures. It would appear to be more about reacting to change, not from a collective, but a singular perspective.

Some of our other recent posts on this subject:
Can eBooks meet the Changing Social Demand? Nov 28th 2011
Whose going to capture the various library worlds? June 20th 2011
Amazon Takes Another Step to Join the Publishing Pieces May 5th 2011
Amazon Overdrive Potentially Lock Up Libraries April 20th 2011
Freeing eLibraries to Compete? March 15th 2011
Digital Library Madness: 26 and You Are Out February 27th 2011
'Public Libraries: Back to the Future'. Brave New World December 2010

Can You Define Tomorrow's Digital Library?

Today we have two separate but interlinked news articles on libraries. Declining spend, visits, issues, stock, staff numbers would all send out alarm bells to most businesses let alone libraries today and the news that the biggest industry player has now launched its own ebook lending library would certainly heighten the alarm bells.

It’s just under a year since we wrote an article ‘Public Libraries: Back to the Future’. The article was about the history of the public library and changes that it now faces in the 21st century. This article was different to the many others we have written, in that it focused on the changes that libraries have gone through both in their funding and their membership and its concluding comments questioned why tomorrow should be the same as today and remain unanswered :

Many would go on blindly demanding on the universal right to 'free' and that the funding by public funds must be a given. However, some would now suggest that this needs to be seriously questioned if we are to avoid the questionable digital position adopted by the UK PA over electronic access, the handing over of public assets to Google and the potential challenges of digital subscription/circulation libraries outside of the public control. Could Amazon or Google Editions become the new digital subscription / circulation library?

First, despite the high profile activity to save UK public libraries, we have a report from the UK Chartered Institute of Public Finance and Accountancy (CIPFA) that states a 2.3% drop in spending across the service of from £1.19bn to £1.16bn. Book acquisition drops included; adult non-fiction, down 13.7% to 2.36m, Adult fiction down 7.4% to 4.58m, children's fiction down 7% to 2.92m and children's non-fiction down 5% to 659,000. The total book stock held by libraries also dropped from 99.2m to 98.3m and the number of libraries also dropped from 4,612 to 4,579. The decline also hit the number of overall visits to libraries which dropped 2.3% to 314.5m and book issued, down 2.9% to 300.2m and even the number of web visits to libraries, which had risen sharply over the previous four years, dropped from 120.4m to 114.8m.

The CIPFA report also stated that the total number of volunteers in UK libraries had risen by 22.3% to 21,462 people whilst the number of library staff had dropped by 4.3% to 23,681 over the same period.

As we face the digital challenge with declining spend, visits, issues, stock, staff numbers we have to ask whether public libraries as we know them today are sustainable.

Secondly, we have the launch of Amazon’s Kindle Owners' Lending Library, which allows ebooks to be borrowed by US Prime members and read on all Kindle E Ink and Fire devices. Prime began as a membership offer for package-shipping benefits and costs $79 per annum and has now added video-streaming with some 13,000 movies and TV shows to members as well as ebook lending. Prime members will only be able to borrow one book out at a time for up to a month and any Notes, highlights and bookmarks made will be saved even when they return the book. When they want to borrow a new book the old book is effectively removed.

In September Amazon entered in agreement with Overdrive to make Kindle titles available to libraries and already libraries claim that the impact of this has been significant in the US.

Amazon claims that Kindle Owners' Lending Library will offer "thousands of books to borrow", but today these will exclude titles from the major trade houses, who have refused to join. Amazon appears to have reached a fixed fee agreement with other publishers and is claimed in some cases to be purchasing a title each time it is borrowed by a reader. Some would suggest that to grow the service in the short term Amazon doesn’t need the major Trade Houses and if like everything else they have pioneered they get it right the major Trade House will need them or an alternative in the long term.

Libraries serve communities and promote reading, learning and have been at the heart of society over the years. However as public libraries come under increasing fiscal squeeze their current business model may also come under increasing pressure.

CIPFA Press Release and report
Amazon Owners' Lending Library
'Amazon Overdrive potentially lock up libraries', Brave New World April 2011
'Freeing eLibraries to Compete', Brave New World March 2011
'Public Libraries: Back to the Future'. Brave New World December 2010

KOBO Has To Follow?

We have still to address ebooks for free from your armchair via your public library versus ebooks to buy, or licence from the internet. The challenge is real and continues to demonstrate that digital is different.

We saw Barnes and Noble and Amazon open up their respective doors to book lending and although this is still on a small scale. We have seen Amazon forging a relationship with Overdrive and providing ebooks alongside Overdrive into libraries. It is also easy to envisage that together with Google’s cloud approach books on demand, for individual rental or subscription may not too is not far away and it is easy to see Apple ticking all the boxes. It is also easy to envisage this being the way to create effective reselling or licensing of used ebooks.

Now we read that the other albeit smaller aggregator Kobo, has also an eBook lending program planned this year! Although Kobo has not divulged all of their plans for lending program it is defiantly coming and probably a must if they are to keep up with the bigger competition.

The challenge for all these new initiatives is to get Publishers to agree to it and although the bigger ones may be cautious and slow to adopt, independents are more likely to adopt a more adventurous and early adopter approach.

In order for Kobo to be on par with the biggest companies in the e-reader and ebook market, they have to implement ebook lending and also a self-publishing program.

Amazon Overdrive Potentially Lock Up Libraries

It’s ironic the day after we wrote about Amazon joining the dots they take another stride and connect some more.

Today Amazon has announced Kindle Library Lending, that will allow Kindle customers to borrow Kindle books from over 11,000 libraries in the US. Kindle Library Lending will be available for all Kindle devices and free Kindle reading apps. To achieve this monumental step Amazon has aligned itself with Overdrive who have successfully built a business opening up the public libraries to ebooks and now have gone past the US and into Europe.

Today we only know what is in press releases and therefore there is potentially huge opportunity to speculate wrongly on what might be. The one thing that is certain it is a huge wake up call for all bookstores, libraries, publisher and authors. Amazon has once again invented the surprise.

The question we would have today are:

1. Is the Overdrive/ Amazon deal exclusive and what are the terms of any exclusivity as that could others from merely following the party?
2. Is there an intent from Amazon to acquire Overdrive, circumvent it later, or keep it as a partner. It would make a great deal of sense to use Overdrive as sales force into libraries?
3. What will this mean to sales as both Overdrive and Amazon as both straddle the buy and lend markets and Amazon clients now have a clear added value of choice and an opportunity to lend first?
4. Library esupply will become harder for the competitors and Kindle is a massive plus for libraries so what can competitors seriously do?
5. Does this new blurring of lend and buy now offer the libraries the opportunity to become resellers and cash in on this through an affiliate back door?

Some ask how it could work? We see the answer as being fairly simple. The libraries and Overdrive already have the system interfaces to manage membership authorisation and communicate loans etc. All Overdrive has to be able to do is present the titles available via Amazon. When it receives a loan request, it merely fires this off to Amazon to pack and dispatch in real time and conform successful receipt. They may do it differently, but it looks simple to us and probably a no brainer to them!

So we may not like eink, but Amazon have extended this to a platform offer and now are stepping up their consumer awareness. Look in the newspapers and watch TV, they are building a brand and brand awareness and now offer library lending.

The only uncertainty today may be Google, but what’s new

Library Budget Cuts And Challenges Are Global

In the US library budgets are being slashed. New York Gov. David Paterson has proposed a budget reduction in state aid to libraries of $2.5 million, or 2.9%, cut from exiting levels. This would represent an $18 million, or 17.6% reduction in the past three years and the fifth time state spending for public libraries has been cut in that time. Queens and Brooklyn library systems have informed some 620 employees that their jobs are in jeopardy, Hemet City, California closing the $14 million library building. Newton County Library, Atlanta will be closed on Mondays effective with the library budget already slashed by $280K, and facing further cuts of $100K in the next year. The Seattle Public Library system have taken a different closure strategy and plan to save some $650K by closing down from August 30th through to September 6th . This is just one of the measures the Library is implementing to achieve $3 million in cuts for 2010. Dallas central library plans to cut its hours from 44 to 24 per week, closing Monday through Wednesday. These cuts would eliminate the equivalent of 96 full time positions. Branch library hours could also be cut from 40 to 20 hours per week, eliminating a further 88 full time positions. Dallas City library system budget last year was $28 million, is currently $22 million and could go to as low as $13 million next year.

In the UK austerity demands cuts and it was inevitable that the UK Department for Culture, Media and Sport would have to suffer. It was also a given that the ‘Hotch Potch’ of vision created at the 11th hour by Margaret Hodge's Public Library Modernisation Review would be high on the list of soft targets. Free internet access in all libraries and the promotion of library membership as an entitlement from birth has been abandoned. The extension of the Public Lending Right to non-print format books has been suspended and there is also the question of the cut back of the fund itself.

Libraries are a cornerstone of our society and learning but are often the first to feel the axe as funding becomes tough. The question must be not just about their funding but about there role moving forward. If they are to go digital what is their relationship with the retail market and how do we square free to loan versus buy to own? If they have access to digital files is that through a third party service ,where they actually don’t own them, but merely serve them up on demand? You need local branches in an internet world?

The debate rages around the globe and in every form of library but is the thinking fresh? Are the same old comities trying to find the answers that suit them? Who is really tackling the challenge of conflict that the digital models and services present?

Digital LibraryWorld: Virtual Library in Surrey

Surrey County Council in the UK are proposing to allow library members to download ebooks and audio books to their personal computers, laptops or other devices.

Its ironic that this is happening the week we wrote about Digital LibraryWorld but today we also received an invitation to tender for a national network across a large European state.

Surrey council claims that it is currently in talks to make the service available across all 53 public libraries across the county. It will not be the first nor will it be the last. It aims to encourage people to read more through the service which will include best seller fiction and a range of non-fiction. The question we raised this week remain unanswered whilst this programme and others roll forward with little or no debate and assessment of the implications.

Bibliothèques

We have previously questioned the role of public libraries in the age of the digital download. Our question is not so much on their validity or funding, but more on their role and market competitive position with respect to digital product, its retail and consumer. In this digital age when anyone is merely a click away from anything, from anywhere, where people go to get it? In this new world are the winners and losers determined not by the content but the cost and ease of access?

If a library lends out digital books for free, or even at a subsidised level, why would the consumer want to buy it? ‘Rent to read’ is probably the most logically digital book model and as broadband and devices become more permanently connected then so does the switch from download to online. The Internet has exploded the ability for anyone to sell or distribute anything to anyone without having the inventory or the pick and pack operation. So if everyone has access to anything at anytime, the choice is down to where you go to get it.

So do libraries just become museums where people go to see vast shelves of paper books, old tomes that would never be found on the high street, or do they engage more with digital content and become community centres of learning, information and culture? Should their be a UK, European or global digital library consortia, or is it now called Google?

What do they charge and how are they funded? If they are already funded by the public, why would the public want to pay again? If the material is free why would anyone want to go anywhere else? A library service such as the Danish eBog service are showing how digital books can be integrated in the public library system, but is this vision shared by others or merely local.

Last week ‘Publishers Lunch’ reported on the ‘Big Library Cuts in Philadelphia.’

‘As municipalities across the country face large gaps in their budget, Philadelphia is taking "drastic new steps" to face the "economic storm" that include closing 11 of the 54 branch libraries that comprise the Free Library of Philadelphia. Three other branches will have Sunday hours eliminated. Mayor Michael Nutter said the branches were chosen "after careful review of building conditions, utilization and distance to other libraries in the Free Library system." Cutting 220 jobs throughout the city government, approximately one third of those layoffs will come from the library staff.’

We have previously reported on the skipping and burning of unwanted books by UK libraries. A situation that can only increase as their physical space and funding diminishes.