The city budget that Chicago aldermen are expected to vote on this week includes substantial cuts to the public library budget—though not as deep as the mayor had originally proposed. Meanwhile, libraries across the country have a new problem: With digital books exploding in popularity, some major publishers are making it more difficult for libraries to get electronic books on their virtual shelves, and to keep them there. Venture looks at a plan to help libraries create something like a national, online, inter-library loan system for digitized books.

To start with, you have to feel a little sorry for people who work at major publishing houses. Publishing a book these days isn’t much harder than hitting “send”—almost anybody can do it— so it’s easy to understand why traditional book publishers feel edgy. Especially because total paper book sales have been dropping, even as electronic book sales have been exploding.

And some of those major publishers are trying to make sure public libraries and their patrons share some of their pain.

With digital books, publishers hope to “control the movement of the books,” says Peter Brantley, who blogs about libraries for Publishers Weekly, and who runs the tech side of a project called Open Library—which is part of a massive online library called the Internet Archive. At the same time, says Brantley, publishers are “very worried that if a digital book goes out ‘in the wild’ that they won’t ever receive payment for it ever again.”

So they restrict library access to ebooks. “Most publishers insist that libraries license the books, which means they don’t really own them,” says Brantley, “and they put on very hard conditions sometimes about what libraries can do with those books.

For instance, early in 2011, HarperCollins, one of the six biggest publishers in the U.S., announced that a library’s digital copy of a HarperCollins book would effectively self-destruct after it got checked out 26 times.  Chicago’s library commissioner, Mary Dempsey, was clearly ticked off. She told the Chicago Tribune, “This strikes at the heart of what we do.”

But frankly, HarperCollins was almost taking it easy.

“There are other publishers that refuse to provide their books entirely in e-book form for lending,” says Brantley. That would be Simon and Schuster and MacMillan, also among the “big six” US publishing firms.  “So we’re seeing for the first time libraries that are wholly unable to provide books to their communities in ebook form.”

Then in early November, Amazon started, in effect, to compete with public libraries, when the company said that some owners of its Kindle e-readers could “borrow” any of 5,000-plus digital titles, including some current and recent best-sellers, for free.

Plus, Amazon’s huge network of users gives it information that, in turn, can make their system more attractive.

At that scale, says Brantley, you can offer readers some extra features—the kind of things that non-digital librarians have always done.  “You can know what they’re reading, you can recommend other books to them, you can suggest to them that their friends are reading a specific title, and so forth,” he says. “So there are huge benefits to having e-book platforms that operate on a scale far greater than any individual library.  So this is a problem for libraries and a reason why I think libraries would have to band together in order to provide any competing service.”

And here’s where Brantley says the Open Library project comes in: They want to help libraries team up to get digital mileage out of their existing paper books. Here’s how he says it works:  “Libraries might provide access to their books, we digitize them, and then the library takes them off their shelf. So then we try to make that book available through a borrowing system—directly to the library patron, so the library patron would be able to check that book out digitally, instead of checking it out in print.”

And the book becomes available for check-out to the patrons of any library system that joins the Open Library project.

But if only one library has sent in a particular book to be digitized, then there’s only one digital copy to loan out, nationwide. But then, maybe a second library sends in the same book.  “So, what we can then do, is have them pull their print copy off their shelves, and then we say, OK, we’ve got two copies,” says Brantley. “And so now we’re preserving the traditional level of access—one book, one lending.

So what they’re basically talking about—although Brantley doesn’t use this term—is a national, digital system for interlibrary loan, using a copyright exemption called fair use. 

Under fair use, says Brantley, “I buy a copy of this book, I can then re-use it, I can lend it out to people without then having to re-pay the publisher or distributor each time I lend it. The whole library system is premised on this concept of fair use.  It’s what makes libraries possible.  And what we’re doing as a library is making a digital copy available on the same terms that we would a print copy.”

Brantley says they’re pretty confident the legal argument is going to hold up, and so far—two years into the project—publishers haven’t raised a stink. 

The implementation has just started getting off the ground, with about a thousand library systems nationwide participating so far.  Chicago isn’t one of them yet. But we’ll see what happens after the City Council deals with Mayor Emanuel’s budget.