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More Ups and Downs Announced in Dialog Pricing
Posted On January 14, 2002
In a late December letter to subscribers, Dialog ( announced another round of adjustments in its pricing structure. Beginning next month, the company will eliminate the $75 monthly minimum usage fee for U.S. users. In contrast, DataStar's European users will have their annual fixed service fee (per account) doubled, as well as face higher connect-time fees almost across the board. The Dialog service fee (per user ID) will go from $12 to $14 for one to five users and, for the first time, $1 per user ID for six to 100 users. Hourly telecommunications charges will increase from $12 to $13 and per-output charges by 6.5 percent across the board. Though use of Dialog's "Finder" files—Company Name Finder, Journal Name Finder, and Product Code Finder—will now be free, DialUnit charges for DIALINDEX will jump from $1.25 to $1.75. Training became free last year.

In explaining the changes, Dialog president Roy M. Martin Jr. pointed to the need to balance revenue and pay for the investments in services and technology with the company's goal of correlating pricing with the customer's perception of value. In the letter, Dialog indicated that it had "significantly improved the overall speed and performance of our computer systems (in some cases, search performance is now 40-percent faster than 1 year ago), while adding 15 percent more trainers, sales, and service representatives to our customer support staff worldwide." Plans for this year include more improvements as well as new products stemming from Dialog's acquisition of NewsEdge.

The new Dialog connect-time pricing alternative to DialUnit charges is now in place for DialogClassic, DialogClassic Web, and DialogWeb product platforms. Even the controversial DialUnit charges have witnessed a new birth of fairness. DialogClassic Web users saw reductions of almost 50 percent in the DialUnit side of their bills, but the letter announced that DialogClassic users will face a 10-percent increase in charges this year.

Martin explained that maintaining and supporting a legacy system like DialogClassic imposes additional costs on Dialog that it must recover through greater charges. For example, the company will shortly issue and distribute—for no additional fee—a new, upgraded copy of its proprietary communication software, DialogLink. In any case, Martin pointed out that charges imposed on the searching side of Dialog transactions, whether DialUnit or connect-time, probably amount to around 20 percent of the average bill; the bulk of the charges stems from output fees. In time, Martin hopes that more users will migrate to Web products.

Commenting on the legacy vs. migration issue, Mary Ellen Bates of Bates Information Services recommended that Dialog follow the example of Dow Jones/Factiva. In moving its users from a proprietary to a Web system, Factiva made the announcement, explained it thoroughly, and gave users 1 year to make the change, with an extension and limited accommodation after that. Bates described Factiva's approach as "more graceful." [Searcher magazine will carry an article by Bates in its March 2002 issue that offers detailed comparisons and recommendations to searchers for DialUnit vs. connect-time pricing options on Dialog.]

For more details on Dialog pricing, check at If you have any questions or comments, Dialog suggests its subscribers write to

Barbara Quint was senior editor of Online Searcher, co-editor of The Information Advisor’s Guide to Internet Research, and a columnist for Information Today.

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