“26″ not set-in stone, OverDrive challenged on access fees

April 7th, 2011 · by spolanka · 1 Comment

Two great articles in Library Journal yesterday.  The first article summarized the comments of Josh Marwell, president of sales at Harper Collins regarding the 26 check-out rule.  Marwell sat on a panel as part of “eBooks: Collections at the Crossroads,” a symposium organized by the Connecticut Library Consortium (#clctrendspotting, #clcebooks).

Clip from article:

“Is 26 set in stone? No. It’s our number for now, but we want to hear back. Immediately. Honestly, it doesn’t make sense that one size fits all. We consider it a work in progress. But this is the number that we have now,” he said.

“I invite you to test the water. Use it. Give us feedback. We’re in the water. We want to be here,” he said, noting that the company wants to sell ebooks to libraries and has been doing so for ten years. Marwell pointed out that HarperCollins has been hearing “quietly” from some librarians who are going to see how the new policy works for them.

“We try to be intelligent about our policy,” he said. “And when we landed on 26, the information that we had was that most books don’t circulate 26 times. In terms of the long tail, this particular number probably works for a different part of the collection. We realize it doesn’t work for the best sellers.”

The second article in LJ discusses the difficult negotiations between the State Library of Kansas and OverDrive.  According to the article, the new contract would raise administrative fees paid by members libraries significantly.  In one case, as much as 700%.

Clip from the article:

The Kansas State Library’s contract with OverDrive expires this December. In September 2010, the library’s director, Jo Budler, received an initial renewal proposal from OverDrive that would have raised the annual administrative fee from its current $10,800 to $25,000 in 2012, $50,000 in 2013, and $75,000 in 2014 and 2015, a 694 percent increase in just three years.”My own budget has been cut 26 percent and to expect that kind of increase is unreasonable. This is unsustainable pricing,” Budler told LJ, saying she refused to accept the proposal, which she called “astronomical.”

“This is just for the platform, no content. It means we won’t have any content money,” she said. The state paid $75,911 in 2010 for content.

OverDrive responded in the article, stating:

OverDrive spokesperson Dan Stasiewski told LJ that the increase in fees under the first proposal was necessitated by the ten-fold increase in circulation that Kansas’s digital collection has had since 2006, even as fees have remained flat.

“This utilizes additional hosting, bandwidth, network and support services,” he said, which OverDrive has been absorbing the cost of. “In the end that seven times increase [detailed below] is coming down to around $200 a library in 2014,” he said.

Categories: Business Models/Pricing,Conferences/Events,Interfaces/Platforms,Library News,Public Libraries,Publishing,Vendor News

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1 response so far ↓

  • 1 Marlene Harris // Apr 13, 2011 at 4:37 pm

    There are some serious questions to be answered regarding exactly what the platform fee is supposed to pay for, and what value libraries receive for that money.
    The entire universe has changed since 2006, there were no Kindles, no iPhones or iPads.
    In today’s market, what does that fee purchase? What services will it buy? Is it worth it? Can libraries afford it? If not, what are the alternatives?
    But using the future platform fee to cover past expenses will not justify the cost for any library– and it wouldn’t for a business, either.