Today's library loans more than just books. The newest and hottest items appear to be ebooks!
Ebooks open up a whole new area of legal questions though.
Previously a library would purchase a certain number of physical books. When a book was borrowed by a patron it was no longer available on the shelf. The way that works with digital material (ebooks) is that the library may only loan out as many copies as they've paid for. Libraries can not make extra copies from an original.
Harper Collins wishes to limit the borrowing of each digital book to 26 times. Personally, I find myself wondering how many readings a good quality physical book can withstand and think that it should be allowed a bit more usage than that and priced accordingly. You can search the internet for "Harper Collins" to find more information on the debate.
The ebook market is exploding right now. That will mean that lawyers round the world will slug this out in the courts. New legislation will have to be made that will suit both publishers/authors and retailers/libraries/readers.
Let the lawyers work on that.
Check out your library's site to see if they have an ebook lending service.
And here is a wonderful comparison of ebooks and physical books by Newsweek:
Books vs E-Books