Breaking Vendor Lock-In: How One Library Migrated to Freedom

Oak Ridge Public Library was locked into a $125K annual ebook contract with punishing terms. Switching costs were prohibitive. Patent penalties for early exit were high. The vendor knew they had the library trapped. But through strategic negotiation, alternative sourcing, and 18 months of focused effort, Oak Ridge broke free, reduced costs by 40%, improved patron access, and proved that vendor lock-in can be broken. Here's how they did it and what you can learn.

The Situation: Trapped

Oak Ridge Public Library (fictional, but based on real institutions) is a mid-sized library in the Southeast serving a population of 75,000. Like most libraries, they'd been using OverDrive for ebook lending for eight years. What started as a smart decision in 2016 (OverDrive was the dominant vendor and patron adoption of ebooks was growing) had become a trap.

The Numbers

$125,000 annual ebook licensing cost to OverDrive

50,000 patron ebook checkouts per year

$2.50 cost per checkout

8 months to migrate from another vendor (estimated by OverDrive)

$85,000 early exit penalty

Oak Ridge's director saw the problem clearly: they were overpaying, patrons were experiencing long hold queues, and they were completely dependent on a single vendor with increasing pricing. But when she asked OverDrive about alternatives, they explained that early exit would cost $85,000 (one-third of their annual contract). The contract ran through 2025. Any switch was economically impossible.

The Trigger for Change

In 2024, OverDrive informed Oak Ridge that their renewal rate would increase from $125K to $139K, an 11% increase. The vendor justified this by citing "market rate increases" and "platform enhancements." Oak Ridge had no negotiating power. They either paid or lost service.

This was the moment everything changed.

Phase 1: Research and Strategy (Months 1-3)

Month 1: Documenting the Problem

Oak Ridge's head of digital collections started building a business case for change. She gathered data:

OverDrive cost per checkout: $2.50
Peer libraries' costs per checkout: $1.80-$2.10 (from conversations with state library group)
Average wait list length: 3-5 weeks for popular titles
Circulation data showing 60% of ebook demand was unmet (patrons gave up waiting)
Vendor contract terms: locked in with no flexible exit options

She presented this data to her director. The message was clear: "We\'re paying premium prices for a service that\'s not meeting patron demand."

Month 2: Exploring Alternatives

The team researched every viable alternative:

Hoopla: Metered pricing (~$1.50 per checkout) but less collection breadth
Multiple smaller vendors: Scribd, Smashwords, each with limited collections
Open Library (Internet Archive): Free-to-participate CDL model, but requires building collection
Publisher direct: Some publishers selling directly to libraries (Tor, Hachette), expensive but with ownership options
Consortium purchasing: Joining a state or regional purchasing coalition for better rates

The winning strategy: a hybrid approach combining Hoopla (metered, cheaper), Open Library (building long-term collection), and publisher direct relationships (ownership).

Month 3: Board and Director Alignment

Oak Ridge's director presented the business case to the board: "We can reduce annual ebook costs from $139K to $85K while improving patron access. The migration will take 18 months and cost $40K. The payback period is one year."

Board decision: Approved the migration plan.

Key lesson: You need board-level commitment to break vendor lock-in. Vendor contracts are expensive to break. Your board needs to understand this is an investment in long-term savings and autonomy.

Phase 2: Negotiation Attempt (Months 4-6)

The Negotiation

Before committing to migration, Oak Ridge tried to renegotiate with OverDrive. They told OverDrive they were planning to switch to reduce costs. Their negotiating position:

"We\'re paying $139K annually for a service that peer libraries use at $1.80 per checkout. We need your renewal at $105K or we\'re migrating."
"We've been a loyal customer for 8 years. We want to stay with you at a fair price."
"Show us the justification for an 11% increase when our usage is flat."

OverDrive\'s response: "That\'s our standard market rate. Take it or leave it."

This was the pivot moment. OverDrive had negotiated themselves out of the contract.

The Cost of Exit

Oak Ridge requested the early termination clause. OverDrive's cost: $85,000. Expensive, but the math worked:

$85,000 early exit fee (Year 1)
$85,000 new ebook budget (Hoopla + Open Library, Year 1)
Total Year 1 cost: $170,000
Compared to: $139,000 to OverDrive + additional platform investment = $160,000

The cost was roughly equivalent, but Year 2 saved $54K (no exit fee), and every subsequent year saved $54K.

Calculate the true break-even: Sometimes the cost to exit vendor lock-in is worth it when you factor in future savings and improved bargaining power.

Phase 3: Migration (Months 7-18)

Month 7-9: Building the New Collection

While OverDrive continued serving patrons, Oak Ridge invested in three new platforms:

Hoopla (metered, per-use pricing): Instant access, no holds, covers popular fiction and nonfiction. Cost: variable, average $40K/year based on prior usage estimates.
Open Library (CDL via Internet Archive): Oak Ridge digitized 500 titles from their existing collection and contributed to Open Library. Free participation. 18-month digitization project, cost: $15K (staff time + scanning contractor).
Publisher direct relationships: Negotiated directly with Tor Books, Hachette, and independent publishers for perpetual access licenses. Cost: $20K upfront for 200 titles with ownership.

Month 10-15: Running in Parallel

Oak Ridge kept OverDrive running while patrons accessed new content through Hoopla and Open Library. Patrons experienced:

Instant access to popular titles through Hoopla (no holds)
No-DRM access to classic titles and backlist books through Open Library
Permanent ownership of specific titles purchased directly from publishers
Continued access to OverDrive titles they knew during transition

Staff created guides on how to access content from each platform. Patrons quickly learned the differences and appreciated the expanded options.

Month 16-18: Final Migration

As the OverDrive contract approached renewal in June 2026, Oak Ridge gave formal notice of non-renewal and paid the $85,000 exit fee. They deactivated their OverDrive account on June 30, 2026.

Total migration time: 18 months. Total transition cost: $115,000 (exit fee + new platform investment). Expected payback: 2 years in reduced licensing costs.

The Results (6 Months Post-Migration)

Metric	OverDrive (Before)	New Model (After)	Improvement
Annual licensing cost	$139,000	$85,000	-39% ($54K saved)
Cost per checkout	$2.78	$1.70	-39%
Annual ebook checkouts	50,000	68,000	+36%
Average wait time for popular titles	4 weeks	0 days (instant via Hoopla)	Eliminated
Platform dependence	100% on OverDrive	Distributed across 3 vendors + owned content	Reduced risk
Vendor lock-in risk	High (85K penalty to leave)	Low (can shift budget allocation dynamically)	Greatly reduced

What Surprised Oak Ridge

Patron adoption was faster than expected. Within 3 months, 40% of ebook checkouts came from Hoopla and Open Library combined.
Hoopla's metered model actually worked better. Instead of holding books, patrons could get instant access. This reduced frustration and increased usage.
Open Library became a community asset. Patrons liked knowing they were accessing books their library owned perpetually.
Staff became better at vendor evaluation. By managing three platforms, librarians understood vendor strengths and weaknesses deeply.
Costs were more controllable. Oak Ridge could adjust Hoopla spending month-to-month based on budget needs, something impossible with OverDrive's fixed annual commitment.

Critical Success Factors

What Made This Work

Board-level commitment. Oak Ridge's board understood this was an investment with measurable ROI. They approved the upfront cost.
Data-driven case. Oak Ridge documented every problem: cost per checkout, wait times, unmet demand. This made the business case undeniable.
Patience. Migration took 18 months, not 3. Oak Ridge allowed time for staff and patrons to adapt.
Parallel operation. Running OverDrive and new platforms simultaneously meant zero disruption to patrons.
Staff investment. Oak Ridge trained staff on three platforms and created clear patron guides. Support matters.
Hybrid approach. Oak Ridge didn't put all eggs in one basket. Hoopla for instant access, Open Library for permanence, publishers for control.

The Lessons for Your Library

1. Vendor lock-in CAN be broken if the math works. Yes, early exit fees are expensive. But sometimes they're worth it for long-term savings and autonomy.

2. Build your case with data. Vendors will resist change. They'll claim their rates are "industry standard." Data from peer institutions proves otherwise. Collect this data before negotiating.

3. Hybrid approaches reduce risk. Oak Ridge didn't rely on a single replacement vendor. Combining Hoopla (flexible pricing), Open Library (permanence), and direct publisher relationships (ownership) created redundancy and control.

4. Get board commitment for upfront investment. Oak Ridge spent $115K to migrate (exit fee + new platform investment). This required board approval and trust. Without it, the migration wouldn't have happened.

5. Parallel operation smooths transition. Keeping OverDrive running while launching new platforms meant patrons experienced zero disruption. They gradually discovered new options at their own pace.

6. Timeline matters. 18 months is long. But trying to migrate in 3 months would have been chaos. Give yourself time.

7. The real savings come in Year 2 and beyond. Year 1 is expensive (exit fee + new platform investment). Year 2+ is where you save money. Make sure your board understands this timeline.

Is This Right for Your Library?

Ask These Questions

What's your current annual ebook cost?
What's your cost per checkout? (Annual cost ÷ annual checkouts)
Does your contract have an early exit clause? What's the penalty?
Does your contract allow the early exit to be paid over time, or is it a lump sum?
What would your new costs be using alternatives (Hoopla, Open Library, publishers)?
What's your break-even timeline? (Exit fee ÷ annual savings)
Does your board have appetite for upfront investment in this migration?

When Migration Makes Sense

Annual cost per checkout >$2.50 (you're overpaying)
Early exit fee <2 years of savings (break-even is achievable)
Board is willing to invest upfront
You have staff capacity for 18-month project
Patron satisfaction is low due to waitlists or platform limitations

When Migration Doesn't Make Sense

You already have reasonable pricing and patron satisfaction
Exit fee is very high with no reasonable break-even
You lack board support or staff capacity
Your contract is expiring soon anyway (renegotiate instead)

Starting Your Own Migration

If your library is ready to break free from vendor lock-in, here's your roadmap:

Document your current situation. Cost per checkout, wait times, unmet demand, contract terms.
Research alternatives. Get pricing from Hoopla, Internet Archive, publishers, and other vendors.
Calculate break-even. Exit fee ÷ annual savings = years to payback.
Get board commitment. Present the business case and timeline.
Negotiate with current vendor. Maybe they'll lower prices to keep you. If not, move forward.
Plan parallel operation. Keep current service while launching new platforms.
Implement over 18 months. Don't rush. Staff and patrons need time to adapt.
Celebrate the savings. In Year 2, you'll have the budget you saved to invest elsewhere.

Remember: Oak Ridge proved that breaking vendor lock-in is possible. It\'s not easy, but it\'s achievable if you have data, board support, and patience. Your library can do this too.