v31#1 ATG Interviews Steve Potash, Founder, OverDrive

by | Apr 12, 2019 | 0 comments

by Nancy Herther  (Sociology Librarian, University of Minnesota)  

Steve Potash founded OverDrive in 1986 to serve the needs of mostly public libraries for distribution and service.  This was at a time when few foresaw the revolution in technology that was to up-end the publishing industry.  For OverDrive, the rise of the internet and digital books in the 1990’s caused the company to refocus their service mission, and launch their content distribution service in 2000.  Today, “along with the industry’s leading digital reading platform, OverDrive now offers the largest digital content catalog in the world to more than 40,000 libraries and schools in 70 countries and the highest-rated apps that are built to create reading happiness.”  With the purchase of OverDrive by Rakuten in 2015, the company changed its brand name to Rakuten OverDrive and the infusion of resources only furthers OverDrive’s dominance, especially for public libraries across North America.  Steve shares some of his experience, vision and perspectives with ATG.

ATG:  In the past two months we have had announcements on new eBook terms from both PRH and Macmillan/TOR, as well the new Panorama Project.  Are publishers still so unsure of the role of libraries, or is this one of the few channels they feel they can still control? Do you see the Panorama Project as making a difference?  I know that OverDrive is one of the sponsors.

SP:  OverDrive introduced public libraries and institutional lending for popular trade eBooks and audiobooks 16 years ago.

Since then we have seen an ongoing evolution of access models offered and adopted by publishers to balance their commercial interests to promote retail sales for print and digital, while still providing libraries broad public access to popular titles.  Changes over the years have included HarperCollins’ 26 circulation limit policy per unit and term limitations from Simon & Schuster and others.

I am delighted to report that the majority of changes to library lending models have actually increased options for libraries and schools.  Today more trade publishers offer their titles for libraries to promote and lend as simultaneous access models. We also have had a surge of publishers and authors promoting their titles for simultaneous access as part of digital book clubs and city read programs.

There is another recent option for libraries to add popular titles with no wait list under a “cost per checkout” model.  We are now offering schools short-term lease terms for classroom sets of eBooks for students. All of these access models complement the principle “one-copy, one-user” model.

Recent announcements from Penguin Random House and TOR (Macmillan) are another step forward in fine-tuning the available models.  I expect these terms to continue to evolve as more data is uncovered on how readers discover and embrace new authors and series, and purchase books.  The Panorama Project has several research efforts underway to determine how libraries, both in their 16,000 locations in the U.S. and online through their OPACs, apps, and discovery services, promote books for readers to discover, and, in many cases, buy.  The Panorama Project will be the first wide-scale data project seeking to understand the impact libraries have on book discovery and retail sales outside of the library.

ATG:  Pricing in the academic environment has been particularly difficult.  Some eBook pricing is far higher than print (one university press charges $28 for a print and $750 for unlimited eBook access).  Some textbooks are reportedly going for nearly $1,000 as eBooks. The PRH plan would require a subscription system, which would ultimately cost libraries thousands of dollars over time for ongoing access.  Will academic/research libraries be able to work with these models?

SP:  We expect academic libraries to curate and offer PRH titles that their readers want under the new pricing and access model.  It may result in collections becoming more selective from authors and genres that align with the readership of the institution.  OverDrive has consistently advised all authors, agents, and publishers that their economic interests are lifted by offering flexible and reasonable terms to enable every library to acquire rights to not only frontlist titles but backlist and complete series of titles as well.  As the new model rolls out to the market, we will learn how it impacts institutional buying patterns which may ultimately impact the publisher’s model going forward. The terms for library lending of digital books will continue to evolve so we should not assume any terms will be the only option in the future.

ATG:  Public library needs are different from those of academics/research libraries.  How do you see eBook publishing and acquisition shaking out in the coming years?

SP:  With a flood of content available from so many sources, publishers and authors need to compete for attention and mindshare from users looking for quality content.  Books and long-form reading need champions to keep the long-term interests of book publishers healthy and growing. There are no better advocates for reading and discovery of books than librarians and the institutions committed to promoting reading and access to information from books.

I expect that outcomes from the Panorama Project will help provide data that impacts publisher and author appreciation for the values that libraries offer for their brand and titles.  All commercial publishers are facing an increasing challenge to have their books discovered and appreciated from an increasing universe of free digital books and a myriad of digital content in other media formats.  I expect to see premium eBook content continue to evolve and grow in value to readers and the institutions that supply access to them. We are moving quite quickly where mobile and digital formats for books are becoming the norm for many categories of books.

ATG:  You clearly have good contacts with other book jobbers. How are they faring in this environment?  They have little power or control and in an increasingly eBook-only environment (if this were to dominate), how could they survive?  Are jobbers trusted by publishers any more than libraries?

SP:  OverDrive promotes reading in all formats and encourages the discovery and appreciation for print.  Physical books will never go away and are a preferable format for millions of readers. This will provide book jobbers an ongoing role for all institutions and libraries.  The momentum and more significant growth opportunities for book sales are in the digital realm. Authors and publishers have enjoyed a print sale, royalty reporting partnership with retail bookstore and book jobbers for 200 years.  This is a trusted channel that provides consistent reporting and royalties to agents and authors. The newer digital book channels are evolving and will gain more support from authors going forward.

OverDrive is working with authors and publishers to provide transparency on library buying patterns for their titles to share information on where, how many, and use for their eBook and audiobook titles.  We expect this new transparency for library and institution investment into digital books will result in a greater appreciation for the digital book channels through libraries. One area of significant growth for publishers and authors is the global market and instant access OverDrive provides for eBooks and audiobooks.  Today, over 40,000 institutions in 72 countries are purchasing eBooks and audiobooks under a variety of access models to serve students, readers, employees, and others worldwide.  


“A Conversation with Steve Potash” by Nancy Herther was first posted on the ATG NewsChannel website as part of Nancy’s article “Publishers Still Unsettled Over The Future Of Ebooks: Part 3 — Distribution Trends From Overdrive’s Steve Potash.”  It along with links to the other two parts of the entire article are available at:  https://www.charleston-hub.com/2018/11/atg-original-publishers-still-unsettled-over-the-future-of-ebooks-part-3-distribution-trends-from-overdrives-steve-potash/.



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