Originally Posted by tubemonkey
My thoughts too. It only makes sense if you're a non-resident and actually living within that library's jurisdiction temporarily.
We already know that publishers charge libraries a premium for e-books, and some (HarperCollins) put a hard limit on the number of loans, and I'm fairly sure an Overdrive contract isn't free. (We know "Freegal", offered by FLP, is in fact not free.)
However you slice it, the economics of e-book lending are a brave new world. Libraries are already familiar with per-use licensing for electronic resources, but not at the scale of demand that e-books are. I can perfectly understand a given library not wanting to sink their finite resources into becoming the go-to for anybody on the Internet. Among other problems, it just makes the wait times longer for local patrons.
There's no win-win for a single (or small number of) library and its local patrons in keeping up with nationwide demand for e-book loans.