See also
https://www.theregister.com/2020/06/...ernet_archive/
and the comments.
I've never suspected IA of being Government backed. It does have one Mirror in Egypt and it's more likely to be backed by someone like Google, who cares about copyright on their own material but encourages piracy by their policies on Google Books/PlayStore and YouTube. Google should never have won the case about scanning and the way they use the scans breaks the intent of what they claimed.
US Court case over Google Scanning EVERYTHING and their concept of Orphan works:
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The problem is that Google books is supposed to show only a partial preview as it might be copyright. The Fair Use argument that Google used. They do basic OCR of the entire book so as to use it for search. Google search is now poisoned with Google Books. Google Books ALSO includes 3rd party books being sold via the PlayStore.
Unlike Amazon, Kobo, Smashwords, Apple etc, Google decides to show the section from where the search hit was. In theory it's possible to download a complete book that's copyright via Google Books, because their algorithm is more designed to aid Google Search than comply with copyright fair use.
They can get commission from adverts and links selling the books and results in Search. That's why the great copyright rip-off of Google Books exists. They even had to block the bit where 3rd parties upload to Google Books to sell via the Playstore. Unlike real ebook sellers they were encouraging PDF as the default, allowing scans. Pirates cut the spine off and ADF (only sometimes with basic OCR for search).
The Court settlement shows how the USA favours big corporations over little people.
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No, the Open Library has never operated the same as most Libraries outside of US. They pay royalties (paper or ebook or audio) based on number of loans. The Authors, not publishers get these.
Also real libraries buy real ebooks at library prices (which can be more or less than retail) and can licence for whatever number of simultaneous loans that they want.
The IA scans real books, been doing it over a decade. Unlike Gutenberg they don't care about copyright. They don't proof, only an automatic OCR to aid search or "fake" ebook versions. Just like Google. They don't acquire ebooks the same way as USA libraries. They are parasites.
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The pre-COVID one owned book, one borrower, at one time, model seems to me the same as a paper book library, except that they honor takedown notices.
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I'm not convinced that they have reliably honoured take down requests in the past.