OC-006·Overdue Conversation
The Cost of Ebooks: An Interactive Breakdown
Move the sliders and see what your library actually pays to lend a digital book. An interactive companion to Follow the Dollar, with every number sourced.
This is the same argument as Follow the Dollar, but you can poke at it. Everything here uses real, cited figures; the two calculators let you swap in your own. If you'd rather read the story straight through, start with that piece. If you want to hand a board member something they can play with, this is the page.
OverDrive circulation rose from 430M (2020) to 820M (2025). Libraries own none of it outright: every title is a license that expires.
Three players, one dinner party
The clearest way to explain who does what:
Demand went up. Ownership stayed at zero.
Digital borrowing has climbed every year since the pandemic. None of that spending buys a permanent copy.
Digital circulation, 2020–2025
OverDrive checkouts worldwide (ebooks, audiobooks, magazines), in millions.
Seattle Public Library
Case file · 2023–24
Britney Spears' The Woman in Me cost about $18 a physical copy but $64.99 per ebook license. Seattle spent roughly $35,000 on digital copies of that one title versus $2,500 in print. In 2023, 62% of its digital-book budget went just to buying extra copies for hold lists. It has since cut max digital holds from 25 to 10.
Spokane Public Library
Case file · since 2012
Spokane has spent $3.3M to buy or lease about 87,000 digital copies since 2012. Because licenses expire, only about 42,000 are still lendable, roughly half gone. OverDrive content now eats more than a third of its $1.5M annual materials budget.
Source: Inlander.
Do the unit math yourself
A print book is bought once and circulates for years. An ebook license is bought again and again, and its cost is spread over a capped number of checkouts. Move the sliders to compare the cost per checkout.
At these settings the library license costs about $52.50 (roughly 3.5× retail).
Markup per checkout: +648%
Assumptions: a print book lasts 50+ circulations (a common industry benchmark), and a library license runs about 3.5× retail. Both are illustrative; real prices vary by title and publisher. See the publisher table below for actual figures.
The markup, publisher by publisher
Here is what a single digital copy of a typical frontlist bestseller runs, next to the consumer price. These are representative figures; they vary by title and shift over time (track them at ReadersFirst).
Where does a $55 license go?
The split isn't publicly disclosed. OverDrive is private and reports nothing. This is reconstructed from author-earnings data and typical Big Five terms; OverDrive's actual cut isn't disclosed, and partial data puts its effective take in the 30 to 55% range.
Ebook license
And the terms are OverDrive's to set. Its current Public Library Access Agreement lets it reprice the platform fee at will (§3.2), charge a fee to move content out (§3.3), and add or remove catalog titles at any time (§2.2). What the library signs is a "non-assignable, non-transferable, limited license," not a purchase.
The bargaining gap
Annual revenue, in billions. Libraries are a rounding error to the publishers they negotiate against, one library at a time.
Big Five figure: sum of most-recent reported revenues (Penguin Random House ~$4.9B, HarperCollins ~$1.9B, Hachette Livre ~$3B worldwide, Macmillan and Simon & Schuster ~$1B each; the last two are privately held and don't report standalone). Library e-materials: ~$449M, the FY2019 IMLS Public Libraries Survey total and about 31% of collection spending; IMLS hasn't published a newer national total.
Price isn't the only lever. There's a sharper move sometimes called digital redlining: publishers don't just overcharge libraries, they can refuse to sell certain titles to libraries at all, or embargo new releases for weeks so a library can't buy the book when readers most want it. Macmillan's 2019 embargo (one copy of a new title for the first eight weeks) is the textbook case. Overcharging caps how much a library can buy; redlining caps what it's allowed to buy in the first place.
What digital crowds out
Library budgets are fixed. When the digital line grows, something else shrinks. Drag the slider to see what gives first.
Balance holds. Print, staff and programs stay funded.
Illustrative starting split (staff 45%, print 20%, building 20%, programs 15%); yours will differ. The point is the shape, not the exact percentages.
How we got here
Two histories run in parallel: who bought whom, and the fight over the rules.
How one private-equity firm came to sit on both sides of the library's digital shelf.
- 1986
Founding
OverDrive begins as a digitization service, founded by Steve Potash.
- 2003
The library pivot
Launches downloadable media for libraries with Cleveland Public Library, becoming the early market leader.
- 2010–11
The partner becomes a rival
Baker & Taylor, OverDrive's exclusive distribution partner since 2009, strikes an expanded deal with a rival distribution platform, LibreDigital, to feed the Blio e-reader. OverDrive sues in Delaware, alleging its partner took trade secrets to build a rival; the core claims survive dismissal, the outcome never goes public, and B&T launches Axis 360 right after. The two-platform market libraries relied on was born in a lawsuit.
- 2013
Publishers consolidate
Penguin and Random House merge into Penguin Random House, thinning the field libraries buy from.
- 2015
Rakuten buys OverDrive
Japanese retailer Rakuten acquires OverDrive for about $410M.
- 2020
KKR buyout
KKR (announced Dec 2019, closed June 2020) buys OverDrive for an estimated ~$775M and pushes toward platform lock-in.
- 2020
RBdigital absorbed
OverDrive takes RBmedia's library business and shuts down the rival RBdigital app.
- 2021
Kanopy
OverDrive acquires the library video-streaming service. Now one firm carries books, audio and video.
- 2023
KKR buys Simon & Schuster
For $1.62B. The same owner now holds the dominant platform and a Big Five publisher, setting terms on both sides.
- 2023–26
Axis 360 winds down
Baker & Taylor ends Axis 360; the remnants rebrand as Boundless, which goes dark in December 2025 when B&T collapses, then is revived in April 2026 by LibraryOne, a months-old startup with no track record. The alternative survives, barely.
The push for fair terms, and the legal wall it keeps hitting. Rust markers flag the turning points; open each item for detail.
- 2011
The 26-checkout cap
HarperCollins introduces metered access. More
The first "your ebook wears out" model: a license expires after 26 loans. At the time it drew outrage; it now looks generous next to pure time limits.
- 2012
The Douglas County experiment
Libraries try to host their own ebooks. More
Douglas County (CO) built a model to buy ebooks directly and host them. Major publishers refused to sell, killing library "ownership" in its cradle.
- 2019
The Macmillan embargo
One copy of new releases for eight weeks. More
Macmillan capped libraries at a single digital copy of new bestsellers for eight weeks, sparking the ALA's #eBooksForAll campaign. Macmillan reversed course in 2020.
- 2021
Maryland's law, New York's veto
First state law passes; a twin bill is vetoed. More
Maryland passed the first state law requiring "reasonable terms" for library licensing. New York passed a similar bill, but Governor Hochul vetoed it.
- 2022
AAP v. Frosh
A federal court strikes Maryland's law down. More
Publishers sued. A judge ruled that federal copyright law preempts state licensing mandates. Maryland's law fell, stalling the state-by-state push.
- 2023
The contract-terms pivot
New bills target unfair terms, not copyright. More
Connecticut and Massachusetts rewrote their bills to regulate contract fairness and price gouging, threading the needle the 2022 ruling left open.
- 2025
Connecticut passes the first reworked law
The contract-terms approach becomes law. More
In May 2025 Connecticut enacted the first library ebook law built on contract fairness rather than copyright, the first of the new wave to survive.
- 2026
DC follows (B26-0490)
The second such law, signed May 28, 2026. More
DC's Library E-book Pricing Fairness Amendment Act passed unanimously. It carries a trigger clause, so it stays dormant until enough other states adopt similar laws, and still faces congressional review. See Two private equity firms own your library.
- 2026
Rhode Island makes three
Passed June 2026, enforcement gated. More
Rhode Island's companion bills passed June 11, 2026 and became law without the governor's signature. Like Connecticut's and DC's, its ban on licenses that charge libraries more than the public pays, demand a per-checkout fee, or cap loans doesn't take effect until at least four other states with a combined 10 million people pass similar laws. New Jersey and Massachusetts have bills moving too.
Questions people ask
Why can't libraries just own ebooks like print?
Buying a Kindle book licenses it to you; a library buys a costlier license to lend it. Publishers treat it as a rental, not a sale, so the file can be made to expire.
Why so much more than retail?
Publishers price against a feared "lost sale," charging libraries roughly three to four times retail and adding expiration to mimic a print book wearing out. It's a business choice, not a cost.
Who is OverDrive?
The company behind the Libby app and about 90% of US library digital lending. It hosts the files and takes an estimated 30–55% of each license. It's owned by the private-equity firm KKR.
What can a library do?
Pull your own invoices, join a consortium, negotiate for perpetual access on backlist, and back contract-fairness legislation. Follow the Dollar lays out the steps.
How to help
Being angry on behalf of librarians isn't the same as changing anything. Here's where that energy actually moves the needle:
- Get your library to publish its invoices. This pricing survives because it stays invisible. Ask your library to make its OverDrive spend public. One library's numbers is a data point; a hundred is a case for change.
- Back contract-terms legislation. Connecticut, DC, and Rhode Island passed laws that regulate unfair license terms instead of copyright, the version designed to survive the court challenge that killed Maryland's law. Ask your state library association whether a bill is moving where you live, and tell your legislators you want one.
- Push for consortium buying. Shared purchasing cuts per-checkout cost sharply. If your state has a digital lending consortium, join it. If it doesn't, ask your state library why not.
- Follow the people already on this. ReadersFirst tracks publisher pricing and license terms; the ALA's ebook advocacy carries the national fight.
The fuller playbook, with every receipt, is in Follow the Dollar.
Sources
- OverDrive circulation: infoDOCKET (2023), infoDOCKET (2024, 739M)
- Seattle Public Library: KUOW, SPL blog
- Spokane Public Library: Inlander
- Pricing and revenue split: Follow the Dollar and its sources (ReadersFirst, Coffman/Computers in Libraries, Jane Friedman, Timberland Regional Library)
- Ownership and legislation: Two private equity firms own your library