“The one thing we know is that information is now ever-present and therefore, in a sense, valueless,” says Kemp Battle, partner in the investment and consulting firm Tucker Capital. And that explains in a nutshell the challenges currently wracking the boardrooms of the world’s reference publishers, who, with their multi-volume encyclopedias and high-price-point dictionaries, are being flung face-first into a digital world by mercenary electronic competitors. Whether they perceive their new competition as a threat — or as a set of opportunities — will make all the difference. “You may make mistakes and you may find it bloody,” says Battle, “but if you’re not doing it, you’re in absolute trouble.” While attitudes at major reference publishers run the gamut from jittery technophobia to digital bravura, most of them have at least engaged the digital marketplace. Here’s a brief update on the field.
“This is our business — online,” says the somewhat sanguine Janice Kuta, who as president of Grove’s Dictionaries has clearly enjoined the battle. The company plans to publish new editions of its encyclopedias and dictionaries online at the same time as print volumes, or, in some cases, before. The process started in 1996 when Richard Charkin took over as the CEO of Macmillan UK. “You’ve got all this wonderful data, now it’s time to go online,” Kuta recalls him saying. “We put the [Grove Dictionary of Art] online within six months, and have been working with it, modifying it, and selling it successfully to institutional markets for one and a half years.”
Now, sales for the online version of Art have “blown conservative estimates out of the water,” in part because it is constantly updated. While the print version has 41,000 articles, the online version started with 45,000; 400 more have been added and 12,000 have been revised. The company’s early experiences with Art have shaped its approach to the second edition of the New Grove Dictionary of Music and Musicians, due out in print and online versions next month. Site licenses to Art, meanwhile, have gone to large public libraries, universities, and even the state of Georgia, giving an estimated 100 million people access to the dictionary. “It’s a very different way of doing business,” Kuta says. “It’s much more satisfying, and it’s all new. Though digital business models can be frightening (“knock on wood, there is still a very strong market for print”), the Grove project is taking determined steps to capitalize on its content.
Of course, another strategy to tackling the online marketplace is simply to partner with the 800-pound gorilla. Garrett Kiely, president and publisher of Palgrave (St. Martin’s scholarly and reference division) explains how Holtzbrinck revamped its digital playbook. Several years ago, the tale goes, Bloomsbury UK director Nigel Newton heard Bill Gates talk about English as a global language. Soon after, Newton wrote to Gates, telling him he’d thought of creating a dictionary based on the same idea, and wondering if Microsoft might be interested in it. And thus was born the Encarta World English Dictionary, the well-known joint project with Microsoft. But does it sell? Kiely says that there has been a “very favorable reaction from the market.” However, key accounts report disappointing print sales, citing negative reviews and the wide availability of the digital edition to Microsoft customers for some time as possible reasons. Matthew Shear, publisher, mass market, says that extensive focus groups for the college edition, coming out next July, confirmed that the big sales will be with the print college edition. Kiely says that part of the Encarta payoff has come in the form of a boost in reputation. “We’ve been quickly seen as a major player. It’s very satisfying for us to have people talking about us and Merriam-Webster and the American Heritage in the same sentence. Now we’re in a position of aggregating our material in some way and presenting new products to the market. We’re not committed to any one path; we’re testing the waters and working hard behind the scenes to pull everything else together.”
Also attempting to pull it together is Rand McNally, which has feverishly been at work on its online travel services. Travel is the most researched product online, according to Christopher Heivly, president of randmcnally.com, who’s been focusing especially on moving customers between the retail stores and the website, where they can customize routes and itineraries depending on personal interests. Even though the online business might cut into brick-and-mortar sales, Rand McNally doesn’t worry about “channel conflicts or cannibalization. We’ve put together a team with a charter to create tomorrow’s business, which is web-based but not just about the web. It’s integrated into everything we do.” For example, a customer can buy something from the online store but return it to a retail store. The whole idea is to focus on creating “Rand McNally” customers, not “online” customers, and tend to the “little, basic stuff.” Unfortunately, adds Heivly, for many companies “the dot-com and IPO craze created two separate teams. We’re trying to leverage 144 years of history and brand.” The upshot? “The content game never ends,” he says, noting that he’s pursuing licensing deals with various travel guides so that the site can appeal to everybody from the antiquer to the “20-year-old in a Jeep who listens to Metallica.”
Merriam-Webster has also envisioned its website as a complement — and not a threat — to print materials. The company’s goal, according to publicist Arthur Bicknell, is to become “ubiquitous” as the online dictionary and thesaurus of choice. Merriam-Webster was “the first to go online with a dictionary and thesaurus in 1988, and it was a risk that panned out very nicely,” he says. “A lot of people raised an eyebrow at that, but it turned out to be an educated gamble. What we were after was branding.” With two sites, m-w.com and wordcentral.com, picking up 25 million hits each month, plus licensing deals with AOL, Yahooligans!, Microsoft, and The New York Times, M-W aims to be king of the online lexicographical hill.
In that, they have company in the form of Houghton Mifflin, whose American Heritage Dictionary has made it to the web primarily via licensing deals. The dictionary has been parceled out to EBSCO, Questia, Bartleby-inc.com, Glassbook, and many others, according to David Langevin, vice president and director of sales. The strategy involves partnering with licensing customers to provide products for any digital use imaginable. And, he claims, it’s working. Langevin says that this year the trade and reference division’s electronic publishing group will contribute more than $1 million to the company’s bottom line. But as other giants get into the action — the OED among them — it’s clear that we’ve only touched the tip of the iceberg when it comes to reaping income from electronic reference works. As the saying goes, watch this space.
