Transcript Document

Untrammelled Access
What is the business models for E-books?
Lorraine Estelle
JISC Collections
ANKOS Annual Meeting 2011
JISC Collections
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Opportunity of digital age!
The digital age provides us with wonderful opportunities for providing
information to students and researchers: Opportunities for flexibility,
convenience and perhaps most important of all, enabling in minutes,
search results that would take years in the physical library
In order to realize these opportunities the library community would like to
license lots of e-books at an affordable price and with access terms that
are simple and easy to understand
However, despite this articulated demand from libraries, the landscape is
messy
There is confusion and even disagreement about the best business
models, and in some cases publishers will not make the e-books libraries
want available – or at least not at an affordable price
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national e-books observatory project
In 2007 JISC Collections undertook the e-books observatory project
(www.jiscebooksproject.org).
The purpose was to:
– understand (though deep log analysis ) how students and lecturers
use e-books
– analyse the impact of the free at the point of use e-books upon
publishers’ sales of print books
We licensed a collection of 36 e-books relevant to UK university students
in four discipline areas. This collection of e-books was made available to
almost every university in the UK, with unlimited concurrent use
This provided us with the opportunity to study the behaviours of students
across 150 institutions. 52,000 users of these e-books responded to our
online survey – we think the largest survey ever of this kind
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We found that:
 The use of text e-books appears to be based on convenience, enabling
students and staff to fit work and study more easily into their busy
lifestyles
 Almost a third of the pages viewed were viewed off campus and at all
hours of the day and night
A more recent study undertaken at the University of Liverpool, also
found that:
 “eBooks are overwhelming preferred in the areas that one would expect:
accessibility, availability, currency, and the ability to transfer the
information from the text. But where aesthetics are concerned, as in ease
and pleasure of reading, print books were clearly favoured”
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When studying the behaviours of users we found:
 E-books are used for quick fact extraction and brief viewing rather than
for continuous reading, they are being used as though they are
encyclopedias and dictionaries rather than extended continuous text
This was finding was supported by the more recent study at the
University of Liverpool:
 “… [users] browsed titles within a certain discipline, but the preferred
method for locating material was keyword search, the most direct and
efficient method for finding information on a given topic. These findings
support a key conclusion … a ‘database of chapter’s’ is a highly effective
means of acquiring content for a research institution.”
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So, in summary these two studies support the idea that:
 “What users like about e-books is that they can get to them whenever
they want to and from wherever they happen to be
 What users do with e-books is to treat them like a huge database of
information, which they mine for the facts needed to answer their
immediate questions
Does that sound rather like Google?
My 18 year old daughter says:
“I like Google, because you can type anything in and get an answer”
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I would argue that if publishers and libraries are to
be successful in the digital age, they must work
together to ensure that ‘paid for content’, is as
accessible and as readily available as the ‘free’
content found through a Google search
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To realize this vision, there are technical problems to be overcome:
 Authenticated access needs to become easier – currently it is often a
tedious barrier to ‘paid for content’
 All publishers all need to provide free MARC Records (or the next
generation of bibliographic records) to libraries and to expose metadata
to the search engines and knowledge bases
 Publisher platforms need to improve, to enable fast landing on the search
results. No-one in this day and age has the patience for 13 clicks to get
to page they are looking for
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However, without trivializing the good work that experts are doing in the
areas of authentication and resource discovery – the technical issues will
be overcome and are relatively easy in comparison to the issues around
sustainable business models
If publishing (as we know it) and libraries are to flourish and we are to
realize the opportunities provided by the digital age – finding a business
model that works is both essential an urgent
I was lucky to hear two inspirational speakers on the subject of business
models for E-books at the 2011 UKGS Conference in the UK
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The
BIG Deal!
Terry Bucknell the Electronic Resources Manager at the University of Liverpool
spoke up for the “Big Deal”(or bundled collection) for e-books
The idea of acquiring every book published in a year, by a particular publisher
seems odd, and I don’t think any library would do that for print books. The library
would rightly think that not every title published by that publisher would be relevant
for their users
However, Bucknell’s analysis of cost-per use of the Springer Collections in a ‘Big
Deal’ purchase model demonstrated it was good value, even though not all of the
titles in the bundle had been used
Bucknell then used the actual usage statistics for the Springer Collection to calculate
what the cost would have been, had the books been acquired using a Patron Driven
Acquisition model. The metrics he used indicate that the Patron Driven Acquisition
model would have cost much more – and that over time the ‘Big Deal’ model would
provide a lower cost per use
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The Patron Driven Acquisition Model
In contrast, Rick Anderson from the University of Utah argued that in the
digital age, libraries should not pay for any titles that are not used
He argued that in the print era, when books and articles were difficult to
find and expensive to distribute, it made sense for libraries to build large
and expensive, "just-in-time" collections
This collection building model transitioned to the electronic environment
with the "Big Deal"(for journals), forcing libraries to pay for material that
their users do not need or use
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With library budgets declining and an electronic environment that
enables resource discovery, the traditional collections building model
ceases to make sense
What makes more sense is to respond to users' needs and eliminate
waste, by acquiring only the material (books or articles) that they need
At the University of Utah, this policy extends not only to electronic
content, but also to print, where they have an Espresso Book Machine, to
produce print copies on demand
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Although they are taking opposing views on the ‘Big Deal’ versus ‘Patron
Driven Acquisition’ model, both are right in their way
In the digital world the Patron Driven Acquisition makes sense in term of
providing users with what they want – rather than buying a ‘bundle of
titles’ of which they may use 80%
However, the problem to be resolved is not only the business model –
but the price
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In the UK there is a famous brand of mustard
- the firm that make it once claimed that they
made their money from the mustard that
people waste, not the mustard people
actually eat
The e-book market is in a similar state. The
publisher needs to either sell more e-books
or increase the margin on a fewer number of
e-books sold
The first option can be easier because the
buyer gets a sense of getting value for their
money, even though some of the e-books
they buy end up being wasted
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Most Patron Driven Acquisition models work on the basis that a view (or
number of views) by users triggers the library purchase of the e-book.
For example, 12 single views, or I whole chapter view, or one cut and
paste, covert the title to a library acquisition
This leads to a number of problems for publisher and library alike:
 The publisher’s problem is that some books may get no views at all –
thus, those that do get acquired have a higher price in order to subsidize
the ones that don’t. (In fact this is the model that is used in the print
world)
 One way for the publisher to lessen this problem is to set a low threshold
for the number of views that trigger a library acquisition
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 The library’s problem is a lack of control over budget and a lack of the
predictability that comes with library led collections building
Indeed many experiments with the Patron Driven Acquisition model have
resulted in the library spending the annual allocated budget too quickly –
and having to put a stop to all e-book acquisition for the rest of the year
The Patron Driven Acquisition Model could work and could provide the
library user with access to the e-books they need, when they need them,
but the model needs to be calibrated
A method is required to allow the library to control and cap overall costs.
This will include control of titles by price limit, date of publication, subject
categories and classification, and the library needs to be able to apply
constraints when needed
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Mobile Technology
A further challenge to publishers and libraries is the mobile
device
Increasingly library users have Kindles, iPads and smart
phones
Users will expect to be able to access e-books on their
devices of choice – but how is this going to work?
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Schumpeter
The economist Schumpeter is
often quoted in respect of these
new technologies and the way
that economic development
arises out
of the destruction of some prior
economic order
There is good historic evidence
to support this theory in regard to
the book publishing business:
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In the early 19th century novels were always published in three volumes,
but most families could not afford the guinea-and-a-half (3.90 TRY),
these volumes cost to buy
In 1840, in the UK, Charles Edward Mudie seized the opportunity
provided by the new technologies of his day, rail, steamships and the
postal service, to distribute and sell books cheaply
He started a subscriptions scheme which meant his customers could loan
as many volumes as they liked for an annual fee for one guinea
(2.56 TRY)
He was so successful that enjoyed a near monopoly and could claim
huge discounts, (around 50%) from the publishers
(This monopoly was only finally challenged by a newer innovation: the single volume novel)
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Amazon is the Mudie of our day, taking advantage of the new
technologies of our time, mobile devices and the internet, to distribute
and sell e-books cheaply
Amazon.com is now selling more Kindle books than paperback books.
Since the beginning of the year, for every 100 paperback books Amazon
has sold, the company has sold 115 Kindle books. Additionally, during
this same time period the company has sold three times as many Kindle
books as hardcover books
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I am not surprised, I love my Kindle:
It is convenient and light, I can take it anywhere with me
I can buy books with “one-click” wherever and whenever I want
And the e-books are much cheaper than the print equivalents
The top selling e-book novel on Amazon costs £1.00 (2.47 TRY) in
e-book format as opposed to £9 (22.27TRY) in hardback or £8
(19.79 TRY) in paperback format.
The same is also true for textbooks, for example Abnormal and
Clinical Psychology: An Introductory Textbook is available in e-book
format at £17.37(43.TRY) as opposed to £35 (86.66 TRY) in print
format
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A Business to Consumer Model
So – we do have an e-book model that works – but it is a Business-toConsumer model
There is no place for the library in this business model
Indeed, in the UK in February 2011 HarperCollins has announced that
new eBook titles licensed to public libraries can only be circulated 26
times before the license expires
The development has led to much anger among librarians, who up until
now have been able to lend any e-books as often as they like – just as
they do with print copies
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The UK Publishers Association (PA) has just announced a clampdown,
informing [public] libraries they may have to stop allowing users to
download eBooks remotely and instead require them to come to the
library premises, just as they do to get traditional print books – arguably
defeating the object of the book
Richard Mollet, Chief Executive, the Publishers Association said:
“Ultimately, the activities of selling and lending have to be able to co-exist
with neither unduly harming the other. If e-book lending were
untrammelled (as some comments seem to propose) it would pose an
extremely potent threat to the retail market which in the long-term would
undermine the ability of authors, and the companies which invest in
them, to see a reward for their creativity.”
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The same issues apply in the world of academic libraries
In the UK the dominant business model for text books is the based on
student purchase
Publishers do not believe access (free at the point of use) via the library,
can co-exist or complement the traditional student-purchase model
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national e-books observatory project
As I mentioned earlier, the second objective of the e-books observatory
project was to analyse the impact of the free at the point of use e-books
upon publisher sales
We monitored the sales of the 36 e-books that were available to all the
students of the 150 institutions across the UK for the year of the project
We found that that there was no negative impact on sales
The publishers were sceptical, and still refuse to make many text books
available in e-format to libraries
Many libraries in the UK would like to provide e-books to their users in
formats which they could download onto mobile devices
Will publishers allow this now that they have the ability to sell direct to
students through Amazon with a ‘one click’ purchase?
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What is the business models for E-books?
So, in summary:
 Libraries face many challenges in providing the e-books their users
increasingly expect
 Libraries face even greater challenges in providing e-books to users on
the mobile devices which are becoming ubiquitous
 The market place is undecided – the Patron Driven Acquisition Model or
the Big Deal?
 New technologies make publishers nervous and so they restrict the
range and type of e-books that are available to libraries
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THE FUTURE
I very much hope that we can work
with publishers to provide our users
with the information they need via
the library. If this can be achieved
both libraries and publishers will
remain relevant to the new
generation of library users
I very much hope we do not have
libraries of the future where Kindles
and iPads are chained to the shelves
as volumes once were – and where
few users ever go because while
publishes and libraries were arguing
Google seized the moment and
“organised the world‘s information”...
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