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Conference speakers challenge publishers to transform their businesses
by
Posted On March 1, 1999
"Inventing Our Future" was the theme of the 1999 Annual Conference of the Association of American Publishers (AAP), Professional/Scholarly Publishing Division held at L'Enfant Plaza in Washington, DC, February 8-10. The conference was larger than last year's, with more than 300 publishers and 33 exhibitors contributing to discussions that centered on how to utilize technology to advance the process of scholarly communication in new ways.

Eight concurrent sessions offered opportunities to learn about the challenges and accomplishments of startups and of established corporations. Both the beginning and ending plenary speakers noted the growth of the world's population, the literacy rate, and the need to serve a larger portion of the people on the planet.
 

At the Plenary Sessions
Rita Rossi-Colwell, director of the National Science Foundation, delivered the opening address and defined the publishers' role as creating alliances of authors, editors, and technologists who work together to devise new ways to share knowledge. During her years of research, Rossi-Colwell discovered how to prevent cholera in Bangladesh by the simple process of filtering water through a sari cloth. She challenged publishers to consider simple solutions that can support world literature and avoid a pyramid with the information rich at the top and the illiterate at the bottom.

The final plenary session was a panel of three speakers who presented a high-level financial and technological view of the publishing industry. Roger Brinner, managing director of the Parthenon Group, noted that low interest rates had driven up price/earnings ratios and that this had supported an increase in shareholder value. Brinner suggested that future gains could not rely on price increases and that publishers need to add value by understanding the customer's economics and designing ways to reduce their costs and increase their profitability.

Panelist Mitchell Haber of Veronis, Suhler & Associates offered observations on trends and opportunities in the publishing world. Major equity funds have been investing in publishing, and this is supporting an increased level of mergers and acquisitions activity. Haber's second point was to focus on global markets, noting that the U.S. book market is only 30 percent of the world market and that 70 percent of the post-secondary education market is outside the U.S. and is growing twice as fast. He distinguished international companies that sell U.S. products overseas from global companies that serve foreign markets with products that include local content and are in the local language. With STM unit growth declining, he pointed out that there are opportunities for growth by translating publications into local languages and exploring the sale of rights or co-publishing, joint ventures, and self-publishing efforts in other countries.

Jesse Berst, editorial director of ZDNet Anchor Desk, returned again this year to present his humorous view of major trends in the industry. Among the new terms he coined related to surfing the Web is "vuja de," which is "the eerie experience of having seen something that we never want to see again."

Berst observed that the old world was about computing and the new world is about connecting. "We've arrived at the beginning of a journey rather than a destination—it's like getting on a roller coaster," he said. He noted five trends to track: 1) end-to-end commerce that will map the customer's entire experience, 2) computing appliances that are task-specific, 3) handheld devices with global positioning systems that enable us to always be connected, 4) embedded chips that are everywhere but will require standards for chips, protocols, operating systems, and connections, and 5) a broadband bonanza whose speed and impact we will likely underestimate. He stated that "content is not king" but serves as a magnet that must be actionable and has a service component, since users want an interactive relationship.
 

Preconference
"How to Sell and Service Online Information" was the topic of an all-day preconference that described how publishers are learning about user behavior and are shifting their focus to post-sale marketing. With the ability to measure usage in an electronic environment, libraries' renewal decisions are influenced by perceived value based on use. Publishers are adding technical support staff and creating programs that promote access to their journals and encourage use through e-mail alerts and cross referencing Web information in the print product.
 

The General Sessions
The opening session was cleverly designed to present all sides of three issues, with Allan Adler of the AAP playing the role of devil's advocate on three topics: WIPO issues, legislation to protect databases, and distance learning issues.

Brian Lamb, who is the chairman and CEO of CSPAN, hosts the television program Booknotes. Lamb delivered an entertaining dinner address, regaling attendees with humorous stories of his interviews on Booknotes and the times he was mistaken for John Glenn and others by visitors to Washington.

Earlier on Tuesday, the R. R. Hawkins Award for the Outstanding Professional Reference of Scholarly Works of 1998 was presented to Oxford University Press for the International Encyclopedia of Dance, edited by Selma Jeanne Cohen. In addition, awards in 32 subject categories were given to 23 publishers of 58 works from the 329 works nominated across the spectrum of science, technology, business, and humanities. This included two Internet-based tools: Columbia International Affairs Online (CIAO) by Columbia University Press, and Nature Biotechnology Web Site by Nature America, Inc.
 

Concurrent Sessions
Not everyone was promoting technology. Robert Oppedisano, director of marketing and sales for Oxford University Press, emphasized the need for quality and value of content, noting that the Web is a medium that should serve as a means to an end and be transparent to providing the service, rather than the focus of development.

When producing an electronic version of a print publication, Mark Licker, publisher of Science Encyclopedia by McGraw-Hill, posed questions that should be asked. What is the product in scope and content? What do customers expect in electronic form? How do we transform the product? What other products should be integrated? McGraw-Hill created a database of all their products that eventually became a synthesis of the entire family of products.

Several attendees were intrigued with the model used by Peter Frishauf, chairman of Medscape, Inc. Medscape offers vendor partners a portion of the advertising revenues based on the amount of usage their data receive and whether Medscape has an exclusive contract with them. This appears to be an effective way to provide an incentive to publishers to promote use of their products online via a particular gateway.

Publishers who produced electronic products hired teams to evaluate options and manage the process internally. They were motivated by the desire to maintain a competitive edge, create new markets, establish their brands, produce timely information, and meet customer expectations. They faced issues in licensing, rights management, fulfillment, customer service, and sales teams. The most common myths they debunked were "it's easy," "it's cheap," "you can make money," and "you should wait until the issues are resolved to begin."

In a panel on the changing role of agents and jobbers, Julie Gammon, head of acquisitions at the University of Akron, highlighted the increased workload required to deal with licenses for electronic products while library staffs are shrinking. Ken Metzner, VP and director of electronic publishing at Academic Press, credited both Tom Sanville of OhioLINK (who spoke later in the conference) and Ann Okerson of Yale University for helping to develop a good license. The goal of Academic Press is to provide access for marginal users at marginal cost, regardless of whether they had maintained a subscription prior to the contract. Metzner suggested that agents could serve as aggregators of customers, handle contract terms and renewals, and provide technical support. Mark Williams, operations manager from EBSCO Subscription Services, noted that their role had expanded to include user identification data, technical service support, and the provision of usage statistics. Steven Woit, VP of content at Rowe.com, suggested that publishers and librarians consider acquiring information through their model, which offers an electronic method for acquiring books, journals, and content at a discount.

A panel of librarians addressed issues of licensing to consortia and networks. Tom Sanville, executive director of OhioLINK, made the point that his effectiveness in securing increased funding from the state depended on his ability to acquire more data (not less data) for more users. He is looking for win/win proposals and referred attendees to the ICOLC (International Coalition of Library Consortia) Web site (http://www.library.yale.edu/consortia). Angee Baker, director of electronic information services for SOLINET, explained their role in negotiating licenses for groups of libraries within a state (South Carolina); across states (ASERL); with publishers such as MCB, Academic, Project Muse, and OCLC's ECO; or nationally, as, for example, in their recent deal with LEXIS-NEXIS.
 

In the Exhibit Area
Thirty-three exhibits included traditional vendors such as the Copyright Clearance Center, new technology for electronic peer review from established companies such as Cadmus and for copyright permissions from YBP (known formerly as Yankee Book Peddler), plus new entrants such as netLibrary.com.

With Copyright Direct, YBP Publishing Services offers an automated service that saves time by connecting publishers and users for permissions and transactions. Developed as a trust-based system by staff well versed in the business, legal, and technical issues, Copyright Direct informs users of their options via pull-down menus and provides publishers with reports on content in demand.

Working in partnership with publishers and libraries, netLibrary.com is focused initially on offering scholarly reference and professional books to academic and corporate libraries. They are actively working with university presses and academic library consortia to introduce electronic titles that can be viewed and printed by one simultaneous user. Sophisticated software allows full-text searching, enables the book to be downloaded, yet protects it from copyright abuse.

With the shift to electronic products, more emphasis is being placed on the needs and behavior of users, which are evident through reports. New technologies are being introduced to enable rights management and support expanded access and use of literature within accepted guidelines. The need for licenses is a burden for libraries to manage, and new services are being offered by subscription agents and regional networks to provide support. Publishers are being challenged to transform their businesses both economically and technologically.

These issues will continue to be discussed at the AAP Annual Meeting, March 17-18 in Washington, DC. The program features Michael Milken, Jeff Bezos (Amazon.com), Steve Case (AOL), and U.S. Treasury Secretary Robert Rubin.


Judy Luther, president of Informed Strategies (http://www.informedstrategies.com), is a consultant in the area of market development.

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