If Netflix Use Isn't Kosher, Can Libraries Find an Alternative? (Updated)
By Josh Hadro Sep 21, 2010A recent dust-up over libraries using Netflix for DVD rentals has some likening libraries to teenagers thinking "it's only illegal if I get caught."
The problem is, when a practice is publicized widely on blogs and in professional journals, it's hard not to get caught.
Against the terms of use
Though there have been reports of small public libraries using Netflix since at least early 2008—always with some question as to the legality of the practice—the recent discussion of Netflix in academic libraries stems from an article by Ciara Healy titled "Netflix in an Academic Library: A Personal Case Study" [subscription required], published in the winter 2010 issue Library Trends. (See below for an update from the editors of Library Trends.)
Most recently, after Rebecca Fitzgerald of Concordia College, Bronxville, NY, described on the Tame The Web (TTW) blog how her library had saved $3000 using the Netflix rental service to supplement the library's media collection, a wave of criticism followed.
Netflix reprimand
In the days after Fitzgerald's blog post, a broad consensus indicated that the use of Netflix by a library violates the company's terms of use. This included a reprimand from Steve Swasey, Netflix communications VP, who told the Chronicle of Higher Education, "[w]e appreciate libraries and we value them, but we expect that they follow the terms of agreement."
Summing up the issue and the distinction between copyright and license violations, Duke University Scholarly Communications officer Kevin Smith told LJ that the practice described raised a red flag:
[A] library creating a Netflix account and using it to request items for professors who then borrow those items from the library seems problematic to me. Assuming, as I do, that the disc loaned by Netflix is “lawfully made,” there really is not a copyright problem here (based on the exclusive distribution right) since the first sale doctrine would seem to apply. But the library may well be in violation of the terms of use imposed by Netflix whenever a member joins. Those terms say that use of the loaned content is restricted to “personal” use, and a court might not consider library lending a personal use. The use of streamed films through a Netflix account may be even more dubious, given the additional restrictions in the agreement.
...those terms of use may indeed trump rights that one has under the copyright law; they are part of a private agreement between Netflix and a user which can create liability only for those two parties if there is a breach of the terms.
Good intentions
Many see the issue as indicative of the lengths libraries will go to preserve service in the face of devastating budget cuts. Still, while poverty and selfless service to the community do much to draw sympathy, others have taken umbrage at the blatant flouting of contractual obligations.
In a reproach on her Information Wants to Be Free blog, Meredith Farkas wrote, "I can’t believe librarians would actually publish and brag about how they are willfully violating a company’s terms of service."
Likewise, a commenter on the TTW post posting as "Willard" called the article "incredibly irresponsible," adding, "[l]ibrarians follow the law when licensing materials, regardless of whether anyone has objected. If they don’t like the licensing terms, they get them changed." In some cases common practice leads to such changes.
Are ebooks next?
Meanwhile, a tweet from Digital Book World links the Netflix kerfuffle to publisher anxieties, asking "DVDs today; ebooks tomorrow?"
At a publisher meeting in March, Macmillan CEO John Sargent described ebook lending by libraries as something that potentially cuts publishers out of any profit from repeat use.
"It's like Netflix, but you don't pay for it," Sargent said. "How is that a good model for us?"
He added, "If there's a model where the publisher gets a piece of the action every time the book is borrowed, that's an interesting model."
Negotiate for change
As with Netflix, license agreements govern the use of ebook collections by libraries and consumers. This uproar has brought home to many librarians that terms-of-use statements can trump copyright exceptions. Now, many are looking for other means to cost-effectively deliver service at a consumer level generally off-limits to libraries.
In this case, LibraryLaw blogger Peter Hirtle makes a reasonable suggestion, writing, "negotiating with Netflix for different terms would be a start."
Update from editors of Library Trends (9/23/10)
As noted, many librarians have taken issue with any endorsement of this practice, some tracing the fault back to Library Trends for highlighting the practice in a peer-reviewed journal. The journal editors stand by the article, however, and claim that the Netflix terms of use are not necessarily violated.
"The editors of Library Trends are not lawyers," general editor Boyd Rayward told LJ, "and our judgments are editorial rather than legal."
He explained further:
Publication in LT indicates that the editors think an article is of high quality and raises interesting ideas worthy of wider attention. We do believe that Ms Healy's piece was of high quality, and your inquiry, and the blog discussion, and the piece in the Chronicle of Higher Education all bear out our sense that the ideas raised here were worthy of wider attention. When I asked [issue editor Ciara] Healy about the issues you raised, her response, which she has given me permission to use, was that "in my opinion, the license agreement that NetFlix uses (its terms of use) is NOT violated by an academic subscription or academic use of NetFlix DVDs in face-to-face instruction. That was my opinion then and it is my opinion today, though the terms of use have evolved quite a bit since 2006."
Rayward, citing Healy's article directly, concluded:
Healy's argument was that libraries might use Netflix as an aid to, rather than a substitute for, purchasing and collection development. We are pleased that the article has helped to generate discussion of the issues involved in library subscriptions to Netflix, though no unanimous view of those issues has yet emerged. What is clear from many of the blog entries, though, is that libraries have an urgent need for subscription to a service like the one that Netflix offers. We hope that Netflix--or another company--will respond positively to this need.
