Presented at the 1999 NFAIS Annual Conference, February 23, 1999, Philadelphia, PA
I open today by stating “ I am bullish on the future of secondary publishing services.” But the challenges are significant, and probably represent the greatest that secondaries have faced in their history. I will structure this talk by addressing why I am bullish, qualify by giving some assumptions, state what secondaries need to do in the short, medium and long range, discuss the parallel path of the Internet with that of secondary publishers, and conclude by summarizing the strategic issues the industry must address.
The users of information as well as the providers of information are increasingly turning to the Internet as the vehicle of choice. The rapid and extensive growth of content on the Internet has clearly shown the need for classifying and indexing. Anyone who has initiated a search and received volumes of results of which 99% are of no use, can attest to this. There has been progress by the Internet community to improve this. The search engines have provided better searching and classifying capabilities and have attempted initial effort at better aggregation. However, the quality of the content, effectiveness of the search engines, and the level of classification and aggregation are a far cry from the traditional services historically supplied by the secondary publishing community. Although much more diffused today, the skill of classifying, indexing, aggregating, and structuring content clearly still resides with the secondary publishers.
In addition to these basic skills, the secondaries have accumulated two other assets that are important. They have defined a field of study and built databases that are credible and comprehensive. In addition, the historical accumulation provides a depth of highly structured content that is valuable in tracking its growth and contributions over time.
One can look at the direction and growth of the Internet, compare it to the traditional online environment, and reasonably draw a conclusion that the two are converging. The Internet environment is showing flashes of understanding the functions that have historically been provided by the traditional online services, although it is addressing these needs from different directions. There is, however, small but growing evidence that the new Internet players are looking to the organizations historically possessing the search and retrieval skills and abilities. They are tapping into that expertise in a number of ways.
In addition to the Internet players (who are largely aggregators), primary publishers in the process of producing electronic versions of their print editions, as well as developing entirely new electronic-only publications, are showing increased interest by looking to secondary publishers to index their material. Primary publishers have traditionally included their material in secondary services for many reasons, chiefly for validation within the library community. The electronic distribution system presents many unknowns to the primary publishers. This adds incentive to their efforts in understanding this new medium and has resulted in an increased level of cooperation with secondary publishers and their electronic expertise, which was previously ignored. Part of these efforts are to link their content to the files of the secondary publishers. Recent announcements such as those by Academic Press <http://www.idealibrary.com/idworld/idworld.htm> and Cambridge Scientific Abstracts <http://www.csa.com/siteV3/csamessage.html> are addressing the demands of the Internet community by adding value through linking of the secondary files with the full-text content. Better service, as well as better measures of the dynamics of this evolving distribution system, will result.
Secondary publishers have always covered and included the traditional forms of content (journals, books, dissertations, reports, etc.) in their services. The Internet has created the need to find, and assess, other forms of content and media. Although currently comprising a very small quantity, secondaries are evaluating these other forms that add value to their services. These other sources, in turn, are beginning to see the need for the access and distribution capabilities that the secondaries provide, and new relationships are forming.
Although I am bullish on the future of secondaries, there is much for them to do to insure survival and prosperity in the coming years. Prior to laying out what I think secondaries need to do, I will present some assumptions upon which this opinion is based. As I indicated in the opening, these assumptions lay the foundation for why I believe the secondary publishers are facing their greatest challenge for change, including their transition from print to electronic services:
I believe that these assumptions are fairly conservative. They are drawn from experience, research, and many conversations with various individuals in the information industry. The assumptions indicate that the Internet will become the dominating distribution vehicle for the information industry. This is not to say that other forms of media will disappear. It does imply the Web will become not only the primary distribution vehicle, but will also represent the chief source of revenue for the majority of the publishing community. The advantages to information providers enabled by the Internet is paralleled by the attraction to this medium by the consumers of information, both users and the subscribing organizations. In both of these sectors you can already see significant commitments to the Internet as the vehicle of choice. These commitments are not trivial, representing an investment of resources that is substantial and long lasting. These committments also represent initial and ongoing structural change across all activities of these participants.
This leads me to address the activities that secondary publishers need to do to remain viable and to grow. I recall a conversation I had with Jim Lohr (Chemical Abstracts) when gathering information for the presentation. He said, “I believe that (secondary) organizations think they are in better shape than they actually are.” There is a great amount of truth in this statement and the following list of activities will point this out. The activities are discussed chronologically, short term, medium term, and long term with short term defined as “now,” medium term as “six months,” and long term as “one year.” This is somewhat facetious, but is not all that unrealistic given the demands and speed of the Internet evolution.
If, as a secondary publisher, you are not aggressively linking to primary content either through third parties, or on your own Internet offering, you are taking a big risk. Users clearly demand the ability to search for information in as few places as possible, obtain references to the content that may answer their questions, then access that content without leaving the seat in front of the computer screen. If they cannot complete this sequence, they will go where they can. Secondary files are excellent tools to help connect the question to the answer, but the answer lies in the next step. If the secondary file does not provide that next step, it will not be used.
The historical file is a valuable asset, and one which may grow in value as various organizations digitize content going back in time. For example, The Digital Vault initiative at UMI <http://www.umi.com/hp/Features/DVault/>, and the activities at JStor <http://www.jstor.org/>, along with many other projects are making a wealth of content available in electronic form. Access to this material, by subject through secondary files, means that secondary publishers can no longer regard their historical databases as static. In addition to the need for constantly updating links, it is becoming increasingly necessary to fill in records that are missing, correct old records, and insert new fields in old records. It is yet to be determined what value this historical material will have, and the case can be made that certain disciplines will yield greater value than others. It requires investment that is not trivial, and the return is not assured, but failing to plan for and analyze the potential outcomes would be a mistake.
Developing your own Internet offering is probably the linchpin strategy for the future. Obviously the Internet, the economics of Internet hosting, and the ability to acquire good search engines at reasonable cost creates the potential for secondary services who have never hosted their own delivery system to do so. This does not mean that current third-party arrangements go away. They are, and will be essential for the future, as they evolve strategies that will service market needs in ways that you cannot. But it will be necessary for secondaries to better control their own future, and failing to have a direct delivery vehicle to the marketplace would place that future in serious jeopardy. The Internet service will affect and influence all aspects of a secondary operation and is a critical piece in the changes secondaries need to make to survive.
I don’t think it is a stretch to assume that most secondary organizations have a budget which shows about ten to fifteen percent of the total expenses allocated for marketing. Most secondary operations are production shops. It is essential that secondary publishers become more market oriented. One quick check is to look at how much you are currently investing in marketing activities. If it is not in the twenty percent plus range, you need to rethink your business plan. I have been struck for some time with the Engineering Information organization and its Ei Village <http://www.ei.org/>. For several years now, this organization has shifted itself from a production orientation to a market orientation, with successful results. It certainly is a model worth emulating.
As a publisher, you are most likely producing several types of media for distribution. This will probably include print, CDs, online, and now your own Internet site. Each of these media, whether direct or through third parties, will have varied update frequencies. As these delivery channels have evolved, one common characteristic is that they shorten the expected update frequency. Whereas several years ago a monthly or quarterly delivery schedule (even an annual one) would suffice, today’s environment demands more current data availability. In addition, production processes must be changed to accommodate the most frequent update. No longer can a secondary operation hold to a schedule that is print volume oriented. Nor can it allow the time from receipt of source material to its availability in a database be measured in weeks and months rather than days, and even hours. The Internet service is the most likely vehicle to economically be updated on a daily basis. This update frequency therefore creates the critical bench mark upon which all production scheduling should be based.
It is very likely, in this industry, to be able to make a database consisting of all of your customers, and ones that should be. It is imperative that you engineer this file with the capabilities of tracking all forms of media that you are selling to any particular customer, customer group, and individual. Migration by customers from one medium to another is common and expected. A situation probably exists whereby certain customers purchase multiple forms of content from you. When these customers drop certain forms--and which ones--are critical pieces of information to your planning efforts. Having a database that can allow you to play “what if” games with a variety of assumptions can be extremely helpful in developing your pricing and packaging strategies. This customer database must also include the capability of linking and reporting parent/child relationships. Not only do you need to track, e.g. a print customer who also purchases a CD (even though you have two different ship to and bill to addresses) on one level, you must also be able to account for the purchasing dynamics interjected by the presence of consortia, which in effect aggregate many diverse buying locations. The consortium purchasing model also requires you to carefully analyze your pricing metrics, across customer base and media delivery.
I once stated at a conference that the transition from traditional online to the Internet poses greater challenges than the transition that secondary publishers experienced going from print to online. In a way, I envy the primary publishers as they are not saddled with the two transitions, nor in dealing with the “online mind set” the secondary publishers have that may hinder their ability to transition into the Internet “mind set.” The two media, although both “online,” are vastly different. An important element in evolving a successful Internet strategy is to learn about, analyze, and implement the Internet “tools” that make sense in your marketplace. These “tools” are unique to the Internet, and can serve to make your Internet offering viable, and according to the demands of your market, essential. I will not cover these tools here--that will take another conference.
Most likely there is not much spent on market research, nor is there much time and effort to identify market research needs in relation to the evolving demands coming from the Internet user community. The fact that this market is vastly different from previous environments means that we are back to square zero in the amount of expertise resident in-house. What must be put in place is not only a commitment to a higher level of research, but to identify the types of research necessary. This process is much broader and more complex than in former times. Concurrently a commitment must be made to devote more resources to the analysis of the research results, and then execute the plans ensuing from that analysis. You cannot do research just for the sake of doing research, but to be actionable.
This leads to the final point of this section, the decision-making process. It is almost trite to say that the speed of your decision making should be equal to, and preferably faster than, the speed of your marketplace. Historically secondary organizations have effectively evolved their decision making process in consort with the demands that online and CDs have brought. Success in the Internet environment, however, requires that the speed and complexity of decision making be moved to a new and even higher level. Whereas accommodating online and CDs allowed much of the print model to be left in place, the Internet will not allow this to continue. The variety of factors involved requires the utilization of personnel differently, understanding and adopting new skill sets, and changes in almost every operational and marketing process. An entirely different set of input and output dynamics is involved. Whereas understanding of the Internet environment is probably the greatest technical challenge for secondary operations, the ability to develop the necessary skill sets to effectively produce successful decision making is the most challenging managerial one.
The trend of multi-disciplinary expansion and growing need for sub- or cross-file searching will continue to increase. This lays the basis for secondaries to assess their content and their capabilities to engage in conversations with the producers of complementary files to an extent not needed previously. A greater degree of differing market demand, along with the technical capabilities to service them, creates new requirements for secondary publishers to respond to. A key component in addressing this is to build the market research function to be able to assess the segmentation of the market in terms of content desired, types of service demanded, functionalities of research capabilities, forms of delivery, and services that extend the traditional offering of secondary services. It is important to assess these needs, even if the decision is to not provide the particular service requested. Collectively, the roles that secondary services have played will have to be expanded and changed in order to meet the demands and to make sure that a void does not encourage filling from another source.
Populating the database with journal articles, book chapters, dissertations, technical reports, etc. will no longer suffice in meeting the needs of the Internet users. They already have been exposed to forms of content that arrive from sources other than those I just mentioned. Already secondary services have struggled with electronic-only publications, or those that have a print and a corresponding e-version. Beyond that, secondaries will have to look at creating and maintaining links to complementary sites, look at the output of independent publishers, assess the ability to include non-print material, software packages, etc. Decisions to review, assess, and include this material will cause secondary services to not only wrestle with economic and technical factors, but will also cause them to review the very definition of what the purpose of the database is, what the Mission Statement of the organization is. This will require multi-level analysis and can include policy level decision making. This item can also, if voted on in the negative, put the database at risk of not satisfying the demands of the market.
These new forms of source material can also open up new roles that the secondaries, or someone else, will need to play. Who will act as the “referee” and provide the referee filter function for the growing independent publishing activities? Can, or should the secondaries step in here? How will the secondaries address the need for cross disciplinary searching, where the solution is to initiate a greater level of interaction between disciplines in areas of language and/or thesauri? How will the secondaries address the demands brought by their provision of search capabilities in addition to the content? How will secondaries deal with the diverse source material that may be included in their offerings? These all require secondaries to assess the role that they currently play, and to evaluate what roles they should strategically encompass.
It is very easy to get lost on the Internet. An interesting observation: new Internet publications have gone from ad revenue, to free, to subscription, and now back to an ad revenue base, indicating that they are having a difficult time getting subscribers. Traditional publications that have a strong brand image, such as the Wall Street Journal<http://www.wsj.com/> however, seem to be doing okay with a subscription based strategy. This could be for several reasons, but I would not discount brand image. As the secondary publishers move past the institution-only customer base, and become more end-user oriented, it is important that brand awareness is more firmly established, especially in an environment that, for many reasons, is forcing secondaries in the other direction.
As the strategic plans evolve, the revenue mix should also be taken into account. The traditional source of revenue from sales and licenses with institutional customers can be expanded. With the Internet, two other forms now become a potential source. Advertising and grants should be analyzed for possible inclusion in the marketing plans. When you can deliver a substantial user community, you attract the attention of advertising revenue. Grants from traditional sources should be contemplated as well as from new sources, such as sponsorships. The desire of major aggregators to obtain proprietary content puts you in a position to assess these potential streams of revenue. An example of expansion of revenue mix is the Lexis-Nexis Academic Universe service provided by Congressional Information Service Inc. <http://www.cispubs.com/acaduniv/index.html>, where advertising revenue was added to the traditional licensing revenue stream and actually played a part in the licensing negotiations.
Looking at a vertical strategy is critical, if not for the reason of expansion, at least for the reason of preservation. What strategies are possible? What is the risk if you do, or don’t occupy a new space? Can new value added be introduced such that you occupy space with current providers at the same time, but create a differentiation in the marketplace that secures your future survival, or expansion? There has been much talk about functions (read organizations) on the information chain disappearing because of the Internet creating disintermediation. What one sees at this time, is expansion of various players in a vertical way, but occupation of that space is continued by traditional service providers. An example of this is the BioTech database service from Elsevier<http://www.elsevier.com/inca/publications/store/6/0/1/4/8/5/index.htt>. Another example is Paul Ginsparg's Web site of preprints <http://xxx.lanl.gov/>, which is expanding and including broader material's as well as material showing signs of a “vertical appearance.” As indicated earlier, when secondary publishers expand their acquisition of source material, should they take on the role of a referee? Should primary publishers take on the role of providing access to material by replacing functions historically provided by libraries as suggested in Andrew Odlyzko’s recent article “Competition and Cooperation: Libraries and Publishers in the Transition to Electronic Scholarly Journals” <http://www.research.att.com/~amo/doc/competition.cooperation.txt>?
The Internet has evolved extremely rapidly. One only needs to go back a few years to arrive at what we generally feel as its beginning. From the start of the Search Engines, progressing to Portals, into Niche Portals and the current beginnings of “enterprise information portals,” one can parallel these technological advancements with content. With Search Engines you had “data,” with portals came “information,” now with niche portals and enterprise portals comes “knowledge.” Secondary services can mirror these advances by evolving from “reference services,” to “active links,” to “diverse content,” then on to “community support platforms,” such as demonstrated by Ei Village <http://www.ei.org/eivillage/village.serve_page?p=4011> and NICEM <http://www.nicem.com/> from Access Innovations. Another good example is the evolution of Medline when it created PubMed. It has now identified 40+ diseases upon which it has created another form of community approach, calling it Medline Plus <http://www.nlm.nih.gov/medlineplus/>. These are only a few examples of the expansion of traditional services that are taking advantage of the Web technologies and economics. In talking with Kent Smith at NLM, PubMed was created because the economics of distribution compared to the former ways allowed the Library to cost justify it. Likewise, significant shifts in economics allow all participants along the information “chain” to reevaluate their roles. Actually it demands it.
I will close this talk by summarizing what I feel are the critical strategic issues faced by the secondary community. They are:
The challenges and opportunities presented by the Internet are significant, pervasive, and require secondary publishers to assess all aspects of their respective operations. From technical, to managerial, to personnel, to systems, to content, every part of a secondary operation is effected. One can develop a series of potentially successful business plans, but then you have to take the risk and execute it. Do you have the resources? Do you have the abilities? The speed of evolution of the Internet, the demands of users, and the potential of new players preempting you are real. The market side is not only shifting its preference for a delivery vehicle, it is also shifting in its power. In the supply-demand model, much has been on the side of the supplier historically. With the Internet, a shift has occurred to move more power to the demand side, both for institutions and for individuals. Institutions have formed “buying clubs,” and individuals are now the direct users, and are feeding back their demands. Both of these factors are significant, and require analysis and response by secondaries.
At the beginning I said I was bullish about the future for secondary publishers. I still am, even given the tremendous challenges that must be faced. I do believe, however, that one should take the words Jim spoke earlier and not “think you are better off than you really are.”