A report from the Connecticut Department of Consumer Protection on the state of the library e-book market has recommended no legislative initiatives at this time, instead advocating for a “wait and see” approach.
“A straightforward mechanism for increasing the availability of electronic books to users of public libraries would be the passage of a law mandating the terms and conditions that publishers must abide by when dealing with libraries,” the report acknowledges. “The Department, however, does not recommend pursuing this path at this time.”
Instead, the report offers three recommendations “aimed at closely observing the market to determine whether and when government intervention may be the best solution and, in the interim, arming libraries with tools and resources that would enhance their opportunities for obtaining e-books.”
Specifically, it recommends that the legislature consider three options for approaching the library e-book issue: Investing in a “state-run e-book distribution platform” that could provide Connecticut libraries with greater flexibility in acquiring and managing their e-content; increasing funds to libraries to cover the expenses of maintaining an adequate e-book collection; or doing nothing at all, and instead watching how current trends play out “without governmental intervention.”
The report was initiated after Connecticut Governor Dannel Malloy signed into law Special Act 13-10, which provided for a study “regarding the availability of electronic books to users of public libraries in this state.” In conducting its study, the Department “sought input from a wide range of entities involved in the electronic-book (“e-book”) market, including libraries, publishers and distributors.”
The report captures the major ups and downs of the library e-book market in recent years. And while it concludes that recent events indicate “that the market is moving in a positive direction,” it acknowledges ongoing concerns, noting that “two areas remain dismal: price and ownership.” In particular, it notes that since e-books are licensed access products, any potential state legislation would be tricky to harmonize with federal copyright laws.
It also acknowledged that the library e-book market involves “electronic distributors,” which adds a layer of cost for libraries. “In Connecticut, for example, libraries pay tens of thousands of dollars each year for distributor services,” the report noted. “Due to the cost of acquiring e-books and maintaining a relationship with one or more distributors, an increasing percent of library budgets will need to be dedicated to e-content.”
Notably, Connecticut was one of the first states to launch an e-book antitrust investigation just months after five major publishers switched to the agency model in 2010—that investigation ultimately became part of the Apple litigation. Connecticut consumers are set to receive a portion of the $166 million in publisher settlement monies from that case, and also stand to grab a chunk of the potential $840 million in damages from Apple, now being litigated in the state and consumer class action phase of the case.
In the case of library e-books, however, the state has apparently found some restraint. “An advantage to taking a wait and see approach is that it allows the market an opportunity to work,” the report concluded. “As a general rule, consumers are best served by a well-working market. And, there are legitimate reasons to conclude that the market may soon reach a balance that results in an appropriate level of e-book availability at public libraries.”