Libraries must reinvent themselves to remain relevant, I recommend they become interactive museums of literature. This will maintain their purpose while avoiding the inevitable loss of funds because most people are no longer interested in paper books.
The reasons for the lack of interest reading a book in paper format are actually really good for book sellers. Books are considered a collectable format, and no one wants to ruin them because of that.
I have a small collection of books that I purchased solely for collecting, and I am not alone in this. For this reason I let almost no one handle them, oils from the skin cause them to break down faster as make the ink run.
Much like trading cards, books are now valued based on more than just their content. Even a badly written book can become very valuable if it is obscure and undamaged.
As for readers, they are more interested in digital formats because they can transport them easier, a million books can fit on a modern device. So libraries and book stores can no longer target the literary fan, they must adapt.
Many bookstores now focus on the collector, which is profitable and keeps paper books in circulation. But how libraries remain relevant will require a new innovation from them.
We have museums of art, science, and nature but we lack any museums for literature. In the USA we lack museums in general, a sad state of affairs.
So turning the libraries into interactive literary museums would solve many of our biggest problems. The problem with encouraging reading has not helped people become more literate.
Also, by encouraging reading we have seen a huge decline in writers, not the number of writers but the quality. Most people who blog often rely on bland current event stories, rarely offering the reader much more that dry facts and figures.
Most blogs are actually plagiarized, something which bothers me. The lack of original works is hurting everyone, as people no longer read articles or stories in depth.
Even I have taken to the simple blog format because it is the only one which people are willing to read, short simple stories. Grammar is also severely lacking now for the same reasons.
So consider this for the libraries: offer a showcases of great works brought to life in exhibits that allow the fans to interact with the characters and writers. Artificial intelligence is not yet perfect, but it could create simulated people for this purpose offering real people to experience the worlds created by authors in a whole new dimension.
This will encourage them to download copies of the books to actually read them, as well as encourage modern writers to offer fans more to read. It will make the libraries relevant again and encourage more funding for them.