It's now a familiar story. Yet another Web content provider feels the pinch from the severe downturn in the Internet economy and reduced advertising revenue and announces it will start charging for content that had been available for free. But this content producer is more than just a Web publisher—it's Britannica, the well-known provider of print, CD-ROM, and online encyclopedia products.
The full text of the venerable Encyclopaedia Britannica has been available for free since the Britannica.com site launched in October 1999, a time when the business environment and customer attitudes fostered—indeed dictated—the information-for-free trend. Many of us were quite surprised by this development and wondered how it could work as a business model for this premium resource—though of course we loved the free access. Now, Britannica.com, Inc. has announced plans to introduce a premium subscription service on its redesigned reference Web site (http://www.britannica.com). Within the next few days, the company said, customers will be required to pay $5 a month or $50 a year for access to the full text of its encyclopedia. With this move, the full Encyclopaedia Britannica will no longer be available anywhere for free.
The comprehensive encyclopedia will form the basis of the new paid premium service. Later in the year, other databases, such as video clips and an encyclopedia for students in grades 5 through 9, will be added to the premium service. The new version of the site being released this month will also provide additional ways for users to navigate the information in the Encyclopaedia Britannica, such as topical browsing and a map browser. The subscription service will be free of banner and pop-up advertising. For some, an ad-free environment alone might justify the reasonable subscription price.
The Britannica.com site will continue to offer several free sources to meet basic reference needs. The opening paragraphs of all encyclopedia articles will be made available for free, giving nonsubscribers access to introductions, overviews, and basic facts. Features that will continue to be free include Britannica's Internet Guide, a directory of Web sites selected and reviewed by Britannica.com's editors; an archive of recent news articles; and selected articles from top magazines. Other information sources, such as a new online encyclopedia for looking up quick facts, will become part of the free service later in the year.
According to a Britannica.com spokesperson, the free site has been very popular, but the company needs to move to a diversified revenue model. Basically, it needs to make money. When the free site was launched, it pulled some people away from its subscription site, Britannica Online (http://www.eb.com). The company has struggled during recent years with a fiercely competitive market, free Internet information cutting into sales, its shifting customer focus, and heavy investments to bring it into the digital age. The company drifted away from its education focus and split itself into two operating units, Encyclopaedia Britannica, Inc. and Britannica.com, Inc. In the dot-com frenzy, it prepared to spin off Britannica.com as a separate, public company. It has now pulled back, hired a new CEO from an educational technology firm, and is merging the companies back into one, determined to turn things around and show a profit.
The redesign of Britannica.com is part of a larger move by the Britannica companies to refocus on their traditional strengths in reference, education, and learning. Under its new multitiered online strategy, Britannica's Internet products in the consumer and education markets will be further differentiated, with content and features being tailored specifically to the needs of each. Tom Panelas, a company representative, said that Britannica intends to repurpose material it already has for specific market niches—a strategy we see other content companies wisely adopting as well. Panelas has been with the company for 20 years and says he has seen "more paradigm shifts than I can count." He is optimistic that the company is now on the right track with its new strategy.
Ilan Yeshua, the recently appointed CEO of Britannica.com, Inc., said: "In the past year alone we have revised more than 4,000 articles and added more than 500 new ones online. We are investing heavily in the content of the encyclopedia to stay on the cutting edge of knowledge and scholarship—revising articles, commissioning new ones, and making sure the Britannica is always fresh, engaging, and up-to-date. We're going to provide a real value-added service, a place where people can find reference content of the highest quality from a range of sources, and we're going to develop tools to make the information you need easier than ever to find."
Britannica.com will continue to sell site licenses for its Britannica Online reference service to educational institutions and subscriptions for BritannicaSchool, (http://www.britannicaschool.com), an integrated suite of teaching and learning tools, to schools for grades K-12. A significantly upgraded version 2 of BritannicaSchool is now in beta and will be available in the fall. Additional CD-ROM and DVD products are also planned. Encyclopaedia Britannica, Inc. will publish a revised printing of the 32-volume Encyclopaedia Britannica this fall and introduce new print products in the near future.
With so many sites now moving to subscription or pay-per-view models, the question will come down to which sites offer content with significant-enough value so that users are willing to pay. Brand loyalty will certainly play an important role, as will reasonable pricing levels. Britannica has a brand that is 233 years old and an affordable price for its new service. Diversification of revenues and a focus on the reference/education market should also help the company achieve its goals.