For libraries facing dwindling borrowers and brutal budget cuts, the ebook seems to offer an irresistible opportunity to reel in new readers and retain old ones too busy or infirm to visit during opening hours.

A third of libraries across the country have embraced the new technology, allowing members to check out electronic literature without setting foot in the building.

But following abuse of the system – with China-based readers attempting to circumnavigate copyright laws by joining British libraries and plundering their virtual collections for free – publishers have now threatened to prevent libraries from accessing ebooks. It's a move described by one library boss as "regressive" at a time when they are trying to innovate as they fight for survival.

But the Publishers Association (PA) claims that "untrammelled" remote lending of digital books could pose a "serious threat" to publishers' commercial activities. That is why it has just announced a clampdown, informing libraries they may have to stop allowing users to download ebooks remotely and instead require them to come to the library premises, just as they do to get traditional print books – arguably defeating the object of the e-reading concept.

Most UK libraries offering ebooks use the US supplier Overdrive, which also supplies ebooks to WH Smith and Waterstones. Under the Overdrive system, library users can access a website remotely, from their home computer or from e-reading devices while on the move, and download ebooks by using their library card and a pin.

Readers do not need to remember to take their books back on time, a perennial problem for many consumers, because the digital book is automatically deleted from their e-reader once the loan period is over.

Librarians say the system enables them to lend to the housebound and disabled, and to provide a service to people too busy to come to libraries during opening hours. For councils looking to save money on library buildings, online operations are an attractive option.

But publishers are concerned that remote lending is not secure, with one library authority recently found to be allowing borrowers outside its geographical boundaries access to ebooks, and publicising the service with the line: "Free ebooks, wherever you are, whenever you want."

Richard Mollet, chief executive of the Publishers Association, said: "Our position is that we have to be certain that ebook lending does not pose a serious threat to publishers' commercial activities – ebook sales. Untrammelled remote access ebook lending would pose such a threat, which in the end would be of no benefit to anyone, including libraries."

He added: "There will be some circumstances where remote lending might be the only way people can access a libraries, if, say, they are disabled, and in that situation it is up to library authorities in concert with publishers to come up with ways that can happen."

Annie Mauger, chief executive of the Chartered Institute of Library and Information Professionals, said the PA announcement was a "first step" in a necessary discussion but there was "a long way to go".

"I can understand publishers' commercial need, but it's a fairly regressive move at a time when we're trying to say libraries are contemporary places, and we're looking for as many ways for the public to access them as possible," she said.

Fiona Marriott, principal librarian for Luton Libraries, which has run an ebook service for 18 months, said libraries were being penalised en masse because a few local authorities "haven't played ball". Luton regularly receives approaches from people as far afield as China or New Zealand wanting to become library members in order to borrow ebooks, but never accepts them, she said. "All our members are Luton customers, they have to physically come into the library and produce ID to join," Marriott said. "We see ebook lending as an important way of extending the service."

The Publishers Association is now approaching ebook aggregators to discuss its new ground rules for secure lending. Overdrive insists the debate is a storm in a teacup. "The Publishers Association is responding to a single isolated incident that was acted on within 24 hours of discovery," said Overdrive CEO Steve Potash from the organisation's head office in Cleveland, Ohio. "Our system has established checks to ensure that libraries are providing ebooks only to those customers in their service area. We have always enforced proper geographic restrictions on the ebooks in our catalogue."

Novelist Nick Harkaway described the publishers' new restrictions as "absolutely futile", saying: "There is a definite risk in every ebook download, but there's also a risk in any physical loan. You can build a scanner for £50, and it takes 20 minutes to scan a whole book. The idea that you can tackle unauthorised filesharing by security countermeasures is very attractive, but not accurate. You have to do it culturally, and I'd like to see publishers get together to campaign for public understanding about intellectual property."

Other authors object to ebooks on the basis that while they currently receive 6p every time a physical copy of their book is borrowed from a library, they don't get a penny if the digital version is loaned.

• This article was amended on 26 October 2010. The original used the spelling Richard Mollett, and referred to the Chartered Institute of Libraries. This has been corrected.

Top titles

The first ebook was a copy of the US Declaration of Independence, scanned into a Xerox mainframe computer in 1971 by Michael Hart. He also started Project Gutenberg, a monster plan to digitise the world's literature.

A glance at the top 10 ebooks downloaded from London libraries this week reveals the capital's tech-savvy borrowers have an appetite for less high-falutin' titles.

All but one are classics of the romantic fiction genre, with titles such as Claimed By The Rogue Billionaire and The Ruthless Marriage Proposal, which tells the story of how housekeeper Emily – "Outside she's a plain Jane, but inside she's a passionate woman …" – falls in love with her rich employer.

There is probably only one name the literati would admit to recognising, and that's Dan Brown, in at number two with The Lost Symbol, the follow-up to Angels and Demons and The Da Vinci Code. The most popular non-fiction titles downloaded this week via the London Consortium of Libraries include How to Persuade People Who Don't Want to be Persuaded – Get What You Want Every Time!, The Easy Step by Step Guide to Communicating with More Confidence, Accounting for Non-Accountants, and Anxiety & Depression Workbook for Dummies.

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