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Amazon Kindle 3Amazon’s Kindle e-reader will finally play nice with libraries. The company announced today that it will debut a Kindle library lending feature later this year with participation from more than 11,000 US public libraries.

The move has been a long time coming for Amazon, which doesn’t support the open ePub format on the Kindle — something that has made it difficult for libraries to take advantage of the device so far. It’s also a shrewd maneuver for Amazon, since borrowing library books could lead to more ebook sales from users who couldn’t finish a book in time, or wanted to revisit a particular title that they’ve borrowed.

Amazon has tapped Overdrive, a provider of ebook and audiobook distribution, for the service. Overdrive’s technology can easily integrate into existing library systems, and it currently has over 500,000 titles from more than 1,000 publishers in its library. The company’s service is already being used by more than 13,000 libraries, schools and other institutions internationally.

Not surprisingly, Amazon says customers will be able to read borrowed ebooks on any Kindle application, in addition to the Kindle e-reader. That alone may help to drive more Kindle sales. Users who get comfortable borrowing Kindle titles on their phone or computer will definitely be tempted to move towards the full Kindle experience.

Borrowed ebooks will also have one major advantage over print versions: you can easily carry over notes and highlights from a borrowed book to a purchased Kindle title. Amazon says that notes made in borrowed books won’t be seen by future borrowers, but they will remain available if you end up borrowing a title again.

Amazon announced last week that it will offer a discounted $114 ad-supported Kindle. With library lending on the horizon, that discounted Kindle will look even sweeter to some (although I think Amazon should have lowered the cost to $99).

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