Concurrently,
netLibrary announced that it has voluntarily filed a petition
with the U.S. Bankruptcy Court for the District of Colorado
for relief under Chapter 11 of the U.S. Bankruptcy Code. The
transaction includes a loan from OCLC, to be repaid upon the
consummation of the asset sale, to fund netLibrary's on-going
operations through the transition period. OCLC's purchase of
netLibrary's assets and its operating-funds loan to netLibrary
are both subject to approval of the bankruptcy
court.
"Electronic books and other forms of
electronic content are quickly becoming strategic drivers in
the sharing and advancement of knowledge in the digital age,"
said Jay Jordan, president and CEO, OCLC. "This potential
alliance with netLibrary would advance our strategic directive
to deliver technologies and services that support, extend and
enhance the OCLC membership cooperative. eBooks complement our
growing e-journal collection and provide exciting new
synergies for our cataloguing, resource sharing, reference and
digital preservation services."
 Strong interest in making netLibrary's
collection available
"Across the OCLC cooperative, there
is strong interest in OCLC's pursuing an alliance that would
continue to make netLibrary's eBook collection available,"
said William J. Crowe, Chair, OCLC Board of Trustees. "Indeed,
14 of OCLC's 16 U.S. regional network affiliates have
arrangements for libraries in their regions to purchase
netLibrary resources. The OCLC Board of Trustees has expressed
its strong support for pursuing this proposed alliance with
netLibrary."
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"OCLC represents an excellent
opportunity for netLibrary patrons, customers and content
partners to continue to deliver the benefits of eBooks and
electronic media to an expanding market. OCLC and netLibrary
share a common commitment to grow and strengthen the role of
libraries and educators in the digital age," said Rob Kaufman,
president and CEO of netLibrary. "We are proud of netLibrary's
role in pioneering the eBook and eTextbook markets. A
potential alliance with OCLC would extend the opportunity to
reach more patrons, grow catalogue content and provide new and
innovative learning opportunities in libraries, classrooms,
homes and offices around the globe."
eBooks and MetaText digital
textbooks
netLibrary develops and markets
eBooks and MetaText digital textbooks. netLibrary's catalogue
now contains approximately 40,000 titles covering a wide range
of subject areas such as business, economics, technology, the
social sciences and more. netLibrary also markets MetaText
digital textbooks, interactive, web-based textbooks with
enhanced teaching, collaborating and learning tools for
teachers and students. MetaText works with the leading
textbook publishers to transform print textbooks into
course-centric digital textbook learning environments. The
MetaText catalogue of digital textbooks, which includes more
than 160 titles, covers topical areas ranging from
Anthropology to Zoology.
At one time netLibrary, employed
some 400 staff. Since being founded in 1998 it raised more
than USD108 million in venture capital from McGraw-Hill,
Houghton Mifflin and others. Its initial public offering was
timed for December 2000 but was cancelled due to unfavourable
market conditions. Since then, other attempts at fund raising
have not been successful. The market for electronic books
according to Jupiter Research is USD70 million in 2001.
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