Why ProQuest Bought ebrary

The New York Times

Take a look at the New York Times homepage. Then take a look at CNN.com or MSNBC. How do you tell which website belongs to a newspaper and which ones belong to a television network? All of them have video. All of them have text. All of them have blogs and forums. As media moves onto the internet, the boundaries between old media genres begin to blur, and new forms emerge, optimized for the purposes they're being used for.

CNN.com

Just as delivery of news is being transformed by the Internet, the needs of students, researchers, and scholars are driving a similar boundary-blurring transformation in libraries. It's also driving a transformation in the companies that serve the library industry.

Marty Kahn, President of ProQuest, used the Times-CNN analogy to explain to me why his company had acquired ebrary, a leader in providing ebooks to academic, corporate, and other libraries. It no longer makes sense for a company to specialize in only journal articles, databases, or eBooks if it wants to be able to provide coherent and evolving solutions.

A look at ProQuest's existing product suite bears that out. With full-text journal databases, newspapers, dissertations, historical archives and government documents (including the CIS division recently acquired from LexisNexis) ProQuest was already able to integrate an impressive array of content. The Summon service from ProQuest's SerialsSolutions unit, which centrally indexes a library's content, has experienced rapid growth, with sales at 200 institutions already. Still, the most common questions that Summon staff were fielding at ALA Midwinter surrounded the integration of ebooks into Summon. With the acquisition of ebrary, ProQuest can now answer that question authoritatively for at least one ebook vendor. (See my previous article focusing on Overdrive.)

Somehow, the topic of EBSCO and their recent acquisition of NetLibrary hardly came up in my talk with Kahn.  We spent a lot more time discussing Google. Between Google Search, Google Scholar and Google Books, Google also has the potential to present a comprehensive information solution for libraries. I often hear librarians expressing the sentiment that they need help from companies like ProQuest to present credible alternatives to Google and free sources available on the internet.

One thing Summon and other library search solutions have lacked is the ability to search the full text of the books in a library's collection. Put next to Google Books' full text plus metadata search, the metadata based search offered by a traditional library catalog can seem rather limited to most users. ebrary will bring with it a huge library of full-text book content for search within Summon.

ebrary was founded by high school friends Christopher Warnock and Kevin Sayar. Libraries were the focus from the very start. Warnock had left a job at Adobe Systems and was working on a project for Stanford University when Stanford University Librarian Mike Keller told him that in order to get paid, he had to incorporate. Warnock called up his friend Sayar, then an attorney at the legendary Silicon Valley law firm of Wilson Sonsini Goodrich & Rosati, and asked if he wanted to act on their high school dreams of starting a company together. The project at Stanford led to the conception of ebrary's initial service for libraries. (I've often heard the misconception that ebrary is somehow an Adobe funded spin-off, because of Warnock's father's role as a Founder of Adobe. In fact, Adobe and the elder Warnock had no role in starting ebrary.)

Warnock has always been passionate about ebrary's mission. "If every library acquired information digitally, all the worlds information would be free to everybody", he told me. He is genuinely excited about what ebrary will be able to do as part of ProQuest. "Being part of ProQuest will allow us to realize our dreams".

Those dreams include the creation of a vast digital library with all kinds of content. ProQuest has "billions" of PDF documents, according to Warnock; ebrary's PDF indexing and search technologies are considered to be unsurpassed anywhere. Although ProQuest is not known for ebook distribution, there's not much difference between a book and a dissertation, if you think about it. ProQuest distributes 70,000 of those every year.

ebrary has also been an innovator in business models as well as in technology. ebrary's initial model was to make ebooks available for free viewing; rights-holders were compensated using a micro-transaction model where subscribers were charged every time they did things such as print pages. Based on customer feedback, they shifted to a model where most content is available for use with on flat subscription. Fee. This year, they've begun to implement a patron-driven acquisition model.

Looking forward, Sayar will be running the ebrary business unit; Warnock will move to ProQuest to work on strategy. Given the ambitious vision outlined by Kahn, he has his work cut out for him.

The ebrary content platform has definitely gained some ardent advocates in libraries. I heard one librarian say "not only do we love ebrary, but our students love ebrary. They really do." At the end of the day, when we ask ourselves how libraries will respond to the dizzying changes in both information and economic landscapes and worry about what will happen, isn't love all we really need?

Patron Driven eBook Acquisition: Crab Legs vs. Spinach

The showpiece of many Chinese Buffet restaurants is the crab legs. What a bargain! One fixed price for all the crab legs you can eat. How do they do it?

The secret to an effective yet profitable Chinese buffet is the presentation of foods with a moderate CBFOM (Chinese Buffet Figure Of Merit), which is computed using the following formula:

CBFOM = SF * P/W,

where P = Price, W = Weight, and SF = Shovel Factor, a measure of how fast a food can be consumed popularized in the early 80's by noted comic epicurean Garfield the Cat.

Crab legs, while expensive, are difficult to eat quickly, while soda (always offered before you attack the buffet) is easy to guzzle and very cheap.

Libraries are slowly getting used to the idea of providing all-you-can-eat services. It used to be that consumption of books in a library was sharply limited by supply. There was never any danger that patrons would bankrupt the library by reading too many literary crab legs, because once the tasty dish had been checked out by the first patron, other patrons had to settle for chicken nuggets and broccoli with garlic souce. The introduction of ebooks is changing everything. What used to be an obvious limit resulting from a book's physicality has become a completely arbitrary limit imposed by impenetrable licensing agreements. It's as if your Chinese Buffet restaurant installed one of those food replicators from Star Trek and the instructions came in Klingon.

Libraries dealing with ebooks have to reconcile their mission of providing access with their limited and declining budgets. One model for doing this is known as "Patron-Driven" (PDA) or "Demand-Driven" (DDA) Acquisition. In this model, the library offers access to a huge menu of content, but only pays for material actually used by patrons. Since 50% of print material acquired by academic libraries never gets used, this results in a 50% cost savings (or 100% increase in bang for the buck, assuming you have bucks).

At the University of Texas Libraries, Dennis Dillon, Associate Director for Research Services, is expecting continuing budget cuts through 2014. "I only want to spend money on books that have a fighting chance of being used" he told me recently. At UT Austin alone Dillon has to address the needs of 20,000 staff and 50,000 students with a book budget of a bit over one and a half million dollars, about $30 per student. $700,000 is spent by selectors, with per-department allocations designed to win faculty "hearts and minds". The rest is split between traditional print approval plans and ebooks.

UT's ebook budget is applied to a demand-driven plan offered by Ebook Library (EBL). About a 100,000 ebooks are offered at UT through EBL. Patrons can search and view any of the ebooks for 5 minutes without incurring any charge to the library. After five minutes, a window pops up, asking the patron if they wish to continue using the ebook. If the patron continues, the library is charged for a use of the ebook, but the patron never knows about the charge. The patron can continue to use the book for 10 days without the library incurring an additional use fee. On the fourth use of an ebook title in the library, an automatic "purchase" is made, and the ebook is added to the library's permanent collection.

Once purchased, an EBL ebook can be "used" up to 365 times per year. This has never happened at UT. You might think that a book assigned in a popular class might reach this threshold, but UT's experience is that even if a book is assigned as required reading in a 300 student class, the library will by lucky to get even 50 uses of a book. Their most popular book has gotten about a thousand uses.

A major benefit of this model is that all the ebooks on offer serve as a sort of digital book stacks. They can be searched and browsed just as if they were owned by the library. This sort of full text search combined with full text availability is something that even Google Books cannot deliver. (UT is an institutional participant in the Google Books Library Project.) UT manages the list of ebooks to minimize its budget risk. For example, all titles over a certain price are removed from the list. No caviar on the Longhorn ebook buffet!

According to Kari Paulson, President of EBL, the patron-driven model developed out of input from libraries who were advising them on ebook access models. In particular, Alison Sutherland from Curtin University in West Australia and Jens Vigen from the library at CERN both wanted to be able to put records in their catalog but buy them only when a patron requested them. CERN wanted everything available with a pay-per-view option with a purchase after a set number of accesses. The library at CERN serves some of the top physicists in the world, which meant that CERN had no issues trusting that their patrons knew best what they needed to read.

Patron-driven service models are gaining traction thoughout the library market. EBL has used demand-driven acquisition and pay-per-view as its key differentiators and is currently using the DDA model with about 150 libraries around the world. Netlibrary has been doing a form of demand-driven acquisition even longer with its Netlibrary on Demand service. Ingram's MyiLibrary service also has patron-driven acquisition options.

Over the last year, ebrary has been testing patron-driven acquisition in a pilot program. According to Leslie Lees, ebrary VP of Content Development, the ebrary program resulted from a surge of interest from its library customers. While similar to EBL's service, the ebrary version of PDA goes to greater lengths to hide the purchase process from users- there's not even a dialog for the user to confirm that they want to continue their session past past the free period. Participants in the pilot program have been quite happy with the results, particularly when they have done a good job of making the content discoverable. The ebrary service is expected to be ready for general use in time for the 2010 fall semester, and will be integrated with management tools from YBP.

I asked Paulson how EBL managed to convince publishers to go along with the untested model. "Publishers were largely nervous about it in the beginning. We took the approach of getting some of the bigger publishers in first so that the others would follow. All of the publishers we have in our catalogue are participating in Demand-Driven Acquistion. Some of the big ones, especially the textbook publishers, have abstained so far."

Lees told me that in addition to responding to customer needs, ebrary is interested in the "short term loan" component of PDA because it could open the door to new service models that appeal to different publishing segments. Textbook publishers need different models from reference publishers, who need different models from monograph publishers, etc.

Interestingly, one company that hasn't dived into patron-driven acquisition model is public-library market-leader Overdrive; very few public libraries have ventured into all-you-can-eat ebook buffets. Perhaps this reflects their funding situation or perhaps a  reluctance of librarians and publishers to trust public library patrons with ebook acquisition decisions. I see no reason that limited patron driven programs, such as ones targetting young-adult literature, couldn't succeed and deliver value in public library settings; they should be explored.

In researching this article, I was surprised to realize how profoundly the role of the library is changed by the switch to just-in-time acquisition. eBooks don't go out of print the way print books did, so libraries don't need to plan for future needs in their current acquisitions. Academic libraries weren't in the business of all-you-can-eat buffets, they were in the wine-cellar business, laying down supplies for use 5 and 10 years in the future. No more. Now they're in the business of getting us to eat spinach.

More on patron-driven acquisition:

• E-books and interlibrary loan: an academic centric model for lending, Jens Vigen and Kari Paulson, 30 Oct 2003. Presented at 8th IFLA Interlending and Document Supply International Conference : Breaking Barriers : reaching users in a digital world, Canberra, Australia, 28 - 31 Oct 2003. Report No. CERN-OPEN-2003-050.
  
• "Patron-driven, librarian-approved: a pay-per-view model for e-books" Susan Macicak and Lindsey Schell, Serials: The Journal for the Serials Community 22,(3) Supp. 1, S31-S38. doi:10.1629/22S31
  
• "Beguiled by Bananas" – A Statistical Analysis of Patron-selected vs. Upfront Acquisition (pdf) Jason Price and John McDonald. Presented at 2009 Charleston Conference
  
• MyiLibrary and Patron Driven Acquisition at SIU-Carbondale, Andrea Imre and Jonathan Nabe. Presented at CARLI eBook Symposium in Champaign, IL on March 4, 2009.
  
• "Technology Left Behind – Letting the Patron Drive", Cris Ferguson, Against the Grain 22(2) April 2010, p. 83.
  
• "Off the Shelf: Patron-Driven Acquisition" Sue Polanka, Booklist 105 (9/10) 2009. Polanka's Off The Shelf blog has been covering business models for ebooks in libraries.
  

At the ALA Annual Meeting in Washingtion DC, there will be a panel entitled "Patron-Driven Access for E-Books: Have We Finally Found the Solution? Monday, June 28th, 8:00 – 10:00 am. WCC-143B/C.  I'll be there. Say hello.

If you have links for other resources, please add them in the comments; I also welcome comments from ebook providers that I haven't had the chance to talk to.