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Dialog Corp. Execs Announce Substantive Plans in Multi-City Tour
Posted On February 23, 1998
Editor's note: On February 17, Dialog Corporation executives Dan Wager, Jeff Galt, and Jason Molle, plus chairman emeritus Roger Summit, launched a 2-week, 18-city tour across the U.S. to meet with key customers and the press. Information Today contributing editor Paula Hane joined them for their Dallas stop, and—given the substantive nature of the plans they announced for the company—immediately filed this NewsBreak report.

Dallas was the fifth stop on what is surely proving to be an exhausting trip for the Dialog Corporation execs—though they certainly didn't seem tired of repeating their presentation at this point. In fact, they seemed exhilarated at the turnout and the chance for interaction with their customers, and glad for the opportunity to lay some major announcements before them. After the 2-hour breakfast briefing, they left on schedule to host a similar lunch meeting in Houston, to be followed by a cocktail-and-dinner briefing in Atlanta. What a day!

Addressing the Information Professional

Executive vice president Jeff Galt made it clear that Dialog was reaffirming a strong commitment to its information professional customers and that these meetings were important for the sharing of information and understanding the vision of the new company. "We are in this together—our future is tied to your future," he said. He noted that they were busy melding two very different corporate cultures following the acquisition of KRI by MAID, but that the company strengths were complementary. He promised that the new Dialog would be an even stronger partner for information professionals.

A Merging of Companies, Cultures, ... and Data

The invitation to the event had reiterated the wedding theme used during the acquisition: "You are invited to join our key executives to celebrate the marriage of the year between Profound & Knight-Ridder Information, Inc." Being a bit weary of this metaphor, I was relieved to see no mention of it that day. Instead, Dan Wagner, president and CEO, stuck to the bussinesslike term "merger."

"This wasn't the merger of two companies," stated Wagner. "This was the merger of three companies." He noted that the DataStar service purchased by Knight-Ridder in 1993 had never been integrated with Dialog. A study of the three services revealed DataStar's databases had a 30 percent duplication of Dialog data, and that Profound had a 70 percent duplication.

Wagner announced that Dialog would undertake a major content loading operation that will add the unique content from DataStar and Profound to Dialog's content. The resultant single source, Dialog, will comprise 9 terabytes of information—over 50 times the content of the Web. The top 30 commands used on the DataStar service will be mapped to Dialog, and users who prefer DataStar will be able to search with that interface. Beginning in September 1998, customers will have one code to access the merged Dialog data with their choice of interactive interface—DataStar Classic, Dialog Classic, Dialog Web, Dialog Select, or Profound Business. There will be a single bill.

To better support increased usage, Wagner said, Dialog will invest $3 million in its network backbone, with multiple POPs (points of presence). The company will continue to offer its groupware products (such as CD-ROMs and intranet services) and databases for its various alliances that reach other audiences (such as WESTLAW, AOL, CompuServe, and British Telecom).

In addition, Dialog plans to create Web pages of information about individuals and companies mentioned in articles, with links from the articles. Users could then easily request additional information, such as news items, financials, etc. There will also be external links to Web resources, such as a company's home page, and links to map a Dialog search to a Web search engine, such as AltaVista.

New, Simplified Pricing Structure: Two Options

Wagner noted that the online services and information professionals have both experienced a significant threat created by confusion in the marketplace from the Internet. It is clear that the price of information is coming down, he said, and that, despite the value offered by online services, those services need to work with a new pricing model to remain viable. To that end, Wagner announced, Dialog will eliminate the plethora of pricing plans across the three services and institute just two pricing options for the new single service: a pay-as-you-go plan or a fixed-price contract.

The pay-as-you-go plan would be simplified from the current design, and revamped across the board. It would offer convenient access, but at a non-discounted rate.

But the fixed-price contract is what Dialog hopes will prove attractive to customers, both large-volume and small-volume users. Contracts will be developed based upon past usage and the projected number and level of users. Wagner stated they were "hungry as a new company and very keen to grow their business," and that the contracts would be very competitively priced. Contracts will be negotiated between customers and geographically placed account representatives (not industry-specific reps, as KRI used before).

Wagner described what he saw as the three benefits of choosing fixed contracts: 1) It will serve to consolidate control within a customer organization's information center for the distribution of information to professionals and end users throughout the company; 2) it will provide additional employee access within the company when rolled out to end users; 3) and it will result in savings.

He noted that Dialog anticipates a huge surge in the use of the system in the first year or two, when access is not limited, but he sees this model as essential for Dialog's survival. He anticipates that the changes will cause the overall business to grow, bringing in new revenue sources.

Keeping Close to Customers

Wagner made himself very accessible to those in attendance at the Dallas meeting, answering questions with poise and knowledge. He said he had been working through each file on Dialog, and had gotten to "G." I appreciate his energy, his understanding of the value of the Dialog content, and commitment to customers and the company's success. Further, Wagner said that he would be moving from the London office of MAID to the corporate headquarters for Dialog in Mountain View, California—more evidence, I think, of the dominant position of the Dialog product in this acquisition.

Customers I spoke with seem to want Dialog to succeed and feel that its executives have developed an interesting vision. Several did express concern about the lack of knowledge and experience of some of the newer account representatives. Some worried about the ability of the "little guys," especially independent information brokers, to leverage reasonable contract pricing. Others said they would like to see a greater commitment to sci-tech information. Monica Bennett, a market analyst with T.D. Williamson who drove from Tulsa, Oklahoma, to the meeting, said she uses both Profound and Dialog and feels the planned changes will lead to an enhanced product. She was pleased, she said, at the prospect of having a single source. She professed to love the Profound interface and said she would hate to see it disappear—and Wagner assured her that it wouldn't.

Endorsements from Roger Summit

It was a pleasure to see Roger Summit, former CEO of Dialog, now chairman emeritus. He said he feels that Dialog is now very focused on its new vision for information access and delivery, and he expressed pleasure at once again being involved. He also indicated admiration for Dialog's leader, stating, "Most people listen with two ears. Dan listens to customers with four ears."

Well, if Wagner does indeed listen carefully to his customers, he should come away with an earful from this cross-country jaunt.

Paula J. Hane is a freelance writer and editor covering the library and information industries. She was formerly Information Today, Inc.’s news bureau chief and editor of NewsBreaks.

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