Analysis of Library Integrated Systems Marketplace
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Transcript Analysis of Library Integrated Systems Marketplace
Una Introducción a la
Industria Internacional de
Automatización de
Bibliotecas.
Marshall Breeding
Director for Innovative Technologies and Research
Vanderbilt University
http://staffweb.library.vanderbilt.edu/breeding
http://www.librarytechnology.org/
Abstract
“An introduction to the international
library automation industry” which will
present information on the major companies
and products, trends such as business
consolidation, globalization, and company
performance.
Vanderbilt University Library
Library Technology Guides
http://www.librarytechnology.org
Repository for library automation data
Lib-web-cats tracks 38,000 libraries and the
automation systems used.
– Expanding to include more international scope
Announcements and developments made
by companies and organizations involved in
library automation technologies
¿Quienes es Quienes?
Koha
– Open Source ILS
Pérgamo
– Commercial ILS software
– Distributed by WalySoft
Aguapey
– Biblioteca Nacional de Maestros
– ILS por bibliotecas de las escuelas
Marco Polo
Catalis
Punto Biblio
SiGeBi – CONABIP
– Systema de Gestion Bibliotecaria
¿Quienes es Quienes? (cont)
Dominant software used by libraries and
information centers throughout Latin America
Distributed without cost by UNESCO
Many different programs:
– CDS/ ISIS
– WinIsis
– Wwwisis
Open Source ILS under development
– ABCD
ILS from Global Automation
Companies
SirsiDynix Unicorn
– Pontificia Universidad Católica Argentina
Ex Libris ALEPH 500
– Universidad de San Andres
OCLC
Not a major factor for most libraries in
Argentina
Observations about Library
Automation in Argentina
Small fraction of libraries use commercial
products from global vendors
Very little involvement with OCLC
CDS/ISIS software prevails
Interest in open source for new projects
Most libraries automate independently
rather than cooperatively
Impact of Politics and Geography
Each Region of the world has its own specific
needs
Resources available for library automation vary
Library automation needs and capacities varies by
geographic, political, and economic situation
Tremendous variation within each region
– Many small, rural libraries in the United States remain
without automation
– In the United Kingdom, the government provides library
services to each library
Global Library Trends
Physical collections continue to play a large
role, but play a diminishing role
Emphasis on resource sharing
Dramatic increases in digital content
Competition with other information providers
on the Web
Library as provider of collaborative learning
spaces
Trends (continued)
Technology center for Universities
Integration with other academic information
systems
– Courseware, Student Records, distance education tools
Library as locus for physical and digital
preservation
Custodian for the intellectual output of the
academic institution
Question: How true are these trends in Argentina?
Business Trends
A look at the companies involved in library
automation and related technologies
Automation System Marketplace
Annual Industry report published in Library Journal
2008: Opportunity out of turmoil (Mostly North
American perspective)
2007: An industry redefined
2006: Reshuffling the deck
2005: Gradual evolution
2004: Migration down, innovation up
2003: The competition heats up
2002: Capturing the migrating customer
Business Landscape: 2007-2008
An increasingly consolidated industry
Venture Capital and Private Equity playing a stronger role
then ever before
Moving out of a previous phase of fragmentation where
many companies expend energies producing decreasingly
differentiated systems in a limited marketplace
Narrowing of product options
Open Source opportunities rise to challenge stranglehold
of traditional commercial model
International: Country-specific companies seeing more
competition from international vendors
Other Business Factors
Level of innovation falls below expectations
Companies struggle to keep up with ILS
enhancements and R&D for new innovations.
Pressure within companies to reduce costs,
increase revenue
Pressure from libraries for more innovative
products
Pressure from libraries not to increase costs
Many libraries lack top quality automation systems
due to high cost
Library Automation M&A History
Consolidation among Libraries
for automation More libraries banding together to share automation
environment
Reduce overhead for maintaining systems that have
decreasing strategic importance
Need to focus technical talent on activities that have more
of an impact on the mission of the library
Pooled resources for technical processing
Single library ILS implementations becoming less
defensible
Essential for libraries to gain increased leverage relative to
large companies
Moving toward a smaller number of larger ILS installations
Why worry about who owns the Industry?
Important to determine best long-term partner for
strategic library development
Some of the most important decisions that affect
the options available to libraries are made in the
corporate board room.
Increased control by financial interests of private
equity and venture capital firms
Recent industry events driven by external
corporate decisions;
Market success and technological advantages
don’t necessarily drive business decisions
Investor owned companies
SirsiDynix -> Vista Equity Partners (bought out
Seaport Capital + Hicks Muse/HM Capital in Dec
2006)
Ex Libris -> Francisco Partners (bought out VC’s in
Jul 2006)
Endeavor -> Francisco Partners (bought out
Elsevier Nov 2006)
Infor (was Extensity, was Geac) -> Golden Gate
Civica -> 3i Investors (private equity)
Public companies:
Auto-Graphics
– De-listed from SEC reporting requirements
– Was OTC:AUGR now Pink Sheets:AUGR
Founder / Family owned companies
Innovative Interfaces
– 100% ownership by Jerry Kline following 2001
buy-out of partner Steve Silberstien
The Library Corporation
– Owned by Annette Murphy family
VTLS – tech spin-off from Virginia Tech,
wholly owned by Vinod Chachra
These companies not under the control of
external financial interests
Revenue sources
License fees for new ILS contracts
Maintenance support
– 15% purchase cost annually with inflation
adjustments
Non-ILS software
Library Services
Diverse Business Activities Many ways to expand business in ways that
leverage library automation expertise:
– Non-ILS software: link resolvers, federated search,
ERM, portal/alternative Web interfaces
– Retrospective conversion services
– RFID or Automated materials handling
– Network Consulting Services
– Content products
– Imaging services
Libraries Demand choice
Current market narrowing options
Consolidation working toward monopoly?
Many smaller companies currently prosper in the library
automation industry
Room for niche players
Domination by a large monopoly unlikely to be accepted by
library community
Monopoly would be subverted by Open Source or other
cooperative movement
Many countries and regions continue to be served by local
companies
ILS Defections
Horizon:
Unicorn:
Millennium:
Virtua:
Aleph 500:
196
187
25
14
5
Business Development Strategy
Essential to understand the strategic business
plans of the company
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Long term growth?
Short term profits?
Growth through M&A
Organic growth by attracting new customer libraries
Positioning for sale?
Get past press releases and spin and look closely
at the corporate behavior.
Major International ILS
products
ALEPH 500
ILS Developed by Ex Libris Group
Specialized system for large academic
libraries, national libraries, and consortia
Adopted by libraries throughout the world
– Israel, Europe, United Kingdom, United States,
Asia, Latin America
Long-term prospects: eventual transition to
URM
$$$$
Millennium
ILS developed by Innovative Interfaces
Generalized system for many library types:
Academic, Public, Law, Medical
Highly regarded for its technical services
sophistication
Geographic Distribution:
– United States, Canada, Asia, United Kingdom, Europe,
Lain America
Long term prospects: commitment to continued
product evolution
$$$$
Voyager
ILS Developed by Endeavor Information Systems,
acquired by Elsevier and later Ex Libris Group
Specialized system for Academic Libraries,
National libraries
Geographic Distribution:
– United States, Australia, Europe, UK
Long term prospects:
– better development under Ex Libris than Elsevier
– Eventual transition to URM
Minimal new sales
Unicorn / Symphony
ILS developed by Sirsi Corporation, now
SirsiDynix
Generalized system for Public Libraries,
Academic, Government
Geographic Distribution:
– United States, Canada, Australia, United Kingdom,
Europe, Latin America
Long term prospects: continued gradual evolution
Significant defection rate
New sales declining.
Horizon
ILS Developed by Dynix Corporation, acquired by
SirsiDynix
Generalized system for Academic Libraries, Public
Libraries, Special
Geographic distribution:
– United States, Canada, Australia, United Kingdom,
Europe
Long term prospects: None. Only maintenance
development continues
Defection rate high, most libraries will leave this
system within 2-5 years
Virtua
ILS Developed by VTLS
Generalized system for Academic Libraries,
Public, National, other special libraries
Geographic distribution:
– Europe, Asia, Australia, United States
Defection rate high. (NYU, Oxford)
Recent project for ILS to Queens Public
Library
Beyond the ILS
Other essential library automation
products
Link Resolvers
SFX from Ex Libris Group
360 Link from Serials Solutions
Federated Search
360 Search from Serials Solution
WebFeat (acquired by Serials Solution)
MetaLib from Ex Libris Group
Electronic Resource Management
Verde from Ex Libris Group
360 Resource Manager from Serials
Solutions
Electronic Resource Management from
Innovative Interfaces
Library Automation
Companies
Innovative Interfaces
Privately owned by one of this founders
No involvement with VC or Private equity
No recent involvement in M&A
– Acquired SLS in 1997
Evolutionary Product strategy
– Innopac -> Millennium beginning in 1995
Millennium as core technology
– Encore, RightResults, ResearchPro
Ex Libris
Global provider of software to Academic Libraries
Largest in the academic market
Owned by Francisco Partners
Acquired Endeavor in Nov 2006
Strong focus on non-ILS products:
– SFX – MetaLib – Verde – DigiTool – Primo
Continues to support and develop ALEPH and
Voyager
SirsiDynix
Highly consolidated company
– Sirsi Corp, Dynix, DRA, MultiLIS, INLEX/300, Docutec, OCLC Local
Systems, DataPhase, Electric Memory, NOTIS Systems
Largest in the industry
Owned by Vista Equity Partners
– Previously supported by VC: Seaport Capital, Hicks Muse)
Consolidated company working toward consolidating and
integrating products and business units.
Recent announcement for single Unicorn-based ILS
Civica
UK Company; library automation unit based in
Australia
Recently purchased by 3i private equity firm
Large company with software products across
several sectors, specializing in systems for public
governmental authorities
Spydus library automation system one of many
business units
– Originated in Australia, deployed in many other
geographic regions
OCLC in the ILS arena?
Increasingly overlapped with library automation activities
WorldCat Local recently announced
– Penetrating deeper into local libraries
Library-owned cooperative on a buying binge of
automation companies:
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Openly Informatics
Fretwell-Downing Informatics
Sisis Informationssysteme
Infovision (Amlib)
PICA (now 100%)
DiMeMa (CONTENTdm)
ILS companies concerned about competing with a nonprofit with enormous resources and the ability to shift costs.
Cambridge Information Group
Increasingly involved in library automation
arena
ProQuest:
– Serials Solutions
– WebFeat
– AquaBrowser (Academic, North America)
R.R. Bowker
– AquaBrowser (worldwide)
– Syndetic Solutions
Major US Companies not present
in Latin America
Follett Software Company
– K-12 School library software
– Destiny ILS
The Library Corporation
– Public Libraries
– Library.Solution / Carl.Solution
Polaris Library Systems
– Public Companies
– Polaris ILS
Auto-Graphics
– Public Libraries
– AGent
International Library Vendors
Advantages and Issues
Stability
Some international vendors may have better
means to survive compared to local country
businesses
In many regions the global companies have
stepped in as local companies decline
– Often local companies lack resources to redevelop through technology cycles
Still risky. Mergers and acquisitions can
make a big impact
Product sophistication
International companies have large capacity
for research and development
Current products offer rich functionality
Support for Unicode and language
localization
Ability to automate very complex library
organizations
Concerns
Ability to provide in-country support
Software optimized for automation needs of
a given region?
Cost. How does the international market
price compare to that of local options and
open source, and subsidized alternatives?
Long-term continuity of products?
– As opportunities decline in the US and Europe,
many seek developing world as an emerging
market for products
Technology Trends
Open Source Library Automation (Afternoon
session)
Next generation library catalogs (Seminar
Wed 10 Dec)
Next generation ILS (Seminar Thursday 11
Dec)
Web 2.0 and Beyond (Seminar Fri 12 Dec)
Questions and Discussion