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Vol. 20 No. 2 — February 2003

1. How's your company doing in the current economy?

2. What special measures, if any, are you taking to ride out the turbulence?

3. What are your priorities for 2003?

(A special thanks to Jim Ashling, Brian McKenna, Marydee Ojala, and Richard Poynder for their interviewing skills.—Ed.)

Wendy Beecham
Sweet & Maxwell, Ltd.
Managing Director

The U.K. economy has not experienced the same level of downturn as the U.S. In December 2002, the International Monetary Fund reported, "The U.K. economy is performing well." In response, U.K. chancellor Gordon Brown said, "The U.K. remains better placed than others to withstand the impact of increased global economic uncertainty." Latest reports suggest the U.K. has actually seen the longest period of uninterrupted GDP growth on record (The Sunday Times, Jan. 5, 2002).

Nevertheless, it has been a challenging year, and we have seen evidence of pressure in the legal market: for instance, an increase in in-house counsel within corporations and pressure on salaries and recruitment in some of the major U.K. law firms.

At Sweet & Maxwell, we were pleased with our performance in 2002. In our legal business, Company Law titles were particularly successful, reflecting some change in the business climate. In August 2002, we added the Lawtel legal online service to our portfolio, and it has continued to sell well with legal practitioners. Westlaw UK has also continued to be a resounding success, providing a premium legal research tool.

In 2002, we relaunched our Consult GEE regulatory online service to provide businesses with compliance information, including Health & Safety, Human Resources, Payroll, and Environment. Since the relaunch, several U.K. and multinational corporations have signed up, along with large U.K. public-sector bodies.

We haven't taken any special measures, as such [to ride out the current turbulence]. We believe the key to success is to focus very clearly on the marketplace and meet customers' changing needs by providing flexible solutions. For instance, in 2002, many of our legal customers shifted their focus away from mergers and acquisitions towards the Private Wealth area. We have responded by investing in product development for titles in Private Client Business to help our customers serve the needs of individuals, rather than the corporate market.

The acquisition of Lawtel has enabled us to reach a broader range of legal customers. In these interesting economic times it is very positive that The Thomson Corp., our parent company, still invests in the future through acquisition.

Priorities for product development in 2003 include looking at changes in legal transactions being driven by requirements for improved efficiency in information transfer, from both government and the public. For instance, we will develop our Forms materials to facilitate electronic transfer of information and leverage our Precedents materials with the launch of some new online services. Changes in Company Law and Criminal Law are on the agenda for 2003/'04, and we will be managing our portfolio of brands to reflect major government reforms. It is critical that we keep our customers informed of developments, as we did for the Civil Litigation reforms in 1998/'99.

In the online arena, we will enhance both Lawtel and Westlaw UK. Intranet solutions and knowledge management will be increasingly important and we will be working with our customers to provide more holistic solutions. Focus will also continue on this year's successful developments in the regulatory business, in particular Consult GEE.

Jean Besson
Questel•Orbit
Chairman and CEO

As a result of the economic situation, volumes have dropped since last May, and this has had some limited impact on Questel•Orbit. However, we have become a much leaner and more flexible organization since the management buyout 2 years ago, and we now subcontract many of our non-core activities—our data processing, for example. This means that it is relatively easy for us to tune our resources in line with changing demand, without any significant impact on our bottom line.

As a consequence, we have not had to take any special measures to counter the downturn. In fact, Questel•Orbit is now highly profitable. We have no debt, good fundamentals, and a very simple but strong portfolio built around intellectual property.

Our priorities for 2003 are threefold. Firstly, we want to broaden our customer base and attract more corporate end users; secondly, we want to continue to consolidate our services and improve our offering; and thirdly, we are looking at possible external growth through acquisition.

To broaden our customer base, we have been putting a lot of effort into creating nonexpert services, such as our Web-based product QPAT. And today we offer a range of different interfaces and software tools for different levels of expertise. Professional patent searchers can connect directly to our online service and use the command line system, or they can access the data over the Web using QWEB.

End users, on the other hand, can access QPAT, which uses the same data as QWEB, but has a different interface and price structure. Similarly, in the trademark area, expert searchers can utilize our online service, while end users can search on Trademark Explorer, our Web product. In 2003, further efforts will be made to improve and enhance these various interfaces and products, including the introduction of alerting services.

We will also continue to work on new, integrated offerings that combine data from many different sources. By integrating patent data from more than 70 patent authorities, for example, PlusPat can provide a single but comprehensive view on a patent. In this respect, PlusPat is unique, and we will continue to develop such products—not just for patent information, but in the trademark arena too.

A new and important focus for us in 2003 will be the development of solutions intended to help customers better integrate our data with their own internal data over intranets. The strategy is to broaden our offering to provide not just information services, but also a complete software platform for assisting users find and interpret patent and trademark information.

Finally, recognizing that we cannot always do everything on our own, we may seek growth through acquisition. In developing our intranet solution, for instance, we realize that we could either do it ourselves, or we could short-circuit the process by acquiring another company that already has such a solution. Since we currently have a very good cash position, this is a very realistic option for us.

Paul Canning
IEEE
Director of Publication and Information Marketing

Actually, IEEE is doing very well, particularly because our content is really mission-critical for our customers.And we have customers in academic, corporate, and government sectors—throughout the world. And a slight majority of our customers are outside the U.S.—a little over 50 percent.

As for measures taken to ride out the current turbulence, there are two things, really. It's been very much this year a partnership with the library community, to show value in the content and to show usage. So it's very much about a partnership with the librarians, to work with them so that they can go to their management toreally justify and secure the renewal the following year.And that's done with usage statistics and pricing comparisons with the marketplace and really being data-driven about the renewal process and working with customers.

In 2003, our priorities are working with our library community customers, but also entering some new markets and developing products that meet the needs of different constituencies within the marketplace. So it's not a "one size fits all" world, and we're introducing the IEEE Biomedical Engineering Library that is to really meet the needs of that biomedical engineering community that we never really served in the past. So [our goals this year are] entering new markets and securing our relationships with our existing customers.

Tim Collins
EBSCO Publishing
Division General Manager

We're doing well at EBSCO Publishing. We're actually in growth mode and have been able to hit our growth targets. However, we've had some situations where our customers have had budget issues, so we've had to work with them through that.But overall, given the fact that we've added additional databases and made significant enhancements to existing databases,we've been able to grow nicely over the last year.

We're definitely being conservative, and like everybody else, are concerned about what one hears on the news about budget cuts, state revenue shortfalls, etc. But we've not made any dramatic changes at this point.

For 2003, we continue to be focused on expanding our product line. With EBSCOhost, we've created a platform which now offers over 100 databases, and we have goals to grow that. So we're licensing additional databases. We're also licensing additional full text from publishers to expand our full-text databases. At [the Online Information conference we] signed several new contracts, so we're moving along on that path.

We're also particularly focused right now on enhancing our customer service. We've got a project right now where we're investing in the expansion of an online Web-support site that we have, as we feel strongly that we want to provide very high-quality service. We want to make sure that we have customers feeling good about how EBSCO's treating them so they'll continue to support us with their renewals.

Debra Curtis
Snapshots International, Ltd.
Managing Director and CEO

The timing of the economic slowdown created many new challenges for Snapshots, especially as the company had only become an independent publisher in September 2001. However, our clients, who were instrumental in the changes at Snapshots, have been loyal and supportive, helping us ride out the difficulties posed by political and economic instability.

By keeping our long-term goals clear, Snapshots was able to publish our most complete collection of reports throughout 2002. Our team's belief in our product and ethics have kept morale strong even when the going got tough.

New business has been slower to initiate, as the market has been nervous about spending any budget, especially with "new" players. But many informationbuyers are now reviewing their sources and have realized that they can achieve cost-saving benefits without cutting quality with Snapshots data.

We listen to the market and provide the flexibility that is demanded during difficult times. For example, Snapshots were originally sold as regional packages (400 reports for North America for $3,995)and although still available in this format, the current purchasing trend often requires individual reports to be purchased on a pay-as-you-go basis. Therefore, we implemented the single report option via our Web site and made our product available through more online aggregates to providegreater accessibility. We also take time to understand how our clients operate and build discounted packages that are more realistic to their usage and budget than a standard fits-all tariff.

Dot-com crashes and corporate scandals, such as Enron, have left most companies and individuals concerned about the level of integrity within business. Especially within the information world, where clients need to be able to trust the data they are working on. We recognized that we needed to invest all our resources into producing a quality product to gain the confidence of the market. In September 2002, Snapshots also set up a dedicated help desk, which would offer support and full transparency of data sources to ensure quality procedures in both our production and our after-service were maintained.

These measures have ensured a higher client-retention rate and stability within the company and product, providing a strong foundation for the company's future.

Now that the market has recognized the Snapshots reports as a reliable datasource, our priority is to maintain our reputation for high-quality content and service while expanding the product's global and industry coverage through organic growth.

Of course, 2002 was difficult for us as a small player. Even the major providers have suffered. But we're looking forward to new challenges and successes in 2003.

Rob Granader
MarketResearch.com
Chairman and CEO

We'll look back at 2002 as our breakout year. We saw nearly 60-percent growth in '02, with particularly strong growth outside the U.S. As for the key sectors for us, certainly, IT and telecom continue to struggle, but the more mature industries for us—pharmaceutical and healthcare, food and beverage, consumer package goods—all had really strong years. These industries are where we have put most of our emphasis and where we have the most historical traction. And while we're pleased with those, we plan to increase our focusin the IT and telecom sectors, in anticipation of improving market conditions in those areas.

Regarding the current turbulence, we are keeping expenses in check. While we've had triple-digit cumulative growth over the past 2 years, total expenses have grown by less than 10 percent, and SGA costs have actually declined during the period. That's a real credit to our managers who have, in the old business cliché, done more with less. It is also consistent with our belief that to be successful as an aggregator, you must learn to be the low-cost provider in the space.

However, we're not cutting in obvious places. Being an online service, the key to our success, we believe, is the ongoing interaction with our customers—talking to them, developing strong one-on-one relationships with them, building a foundation of trust. So in order to maintain those, we are continuing to spend money on our trade show presence, the caliber of our account managers, and product development efforts intended to meet the needs of our growing user base.

As to our priorities for 2003, we will continue to be conservative in our expenditures, but aggressive with our expectations. On the product-development front, we will launch an upgraded version of our MarketResearch.com site in Q2. This version will build on the strengths of the current service with new tools to make it even easier for customers to identify relevant research. Following that launch, we will begin an upgrade of our enterprise product. We are working with many of our information professional clients to provide them with more information about research-purchasing habits within their organization and more tools for managing costs.

On the content side, we expect to further increase the breadth and quality of our research content by spending a lot of time working with our existing partners and identifying new partners in core markets.Despite the fact that we currently offer research from nearly twice as many sources as any other company, we will continue to respond to customer requests by adding high-quality content from new sources and packaging existing content in new ways.

Finally, we hope to dramatically increase our exposure to new customers in new markets through new distribution partnerships, great international exposure, and expanded marketing efforts. With less noise in the marketplace, we've emerged from 2002 much stronger, with a huge opportunity to further establish our position as the preferred aggregator of market research.

Steven Hall
ProQuest Information and Learning
Senior Vice President and General Manager

It's not been an easy year, especially in Germany, and even Scandinavia. But, overall, it has been good, and we are finishing the year strongly, especially in Asia. The breadth and variety of our products stands us in good stead in these more challenging trading conditions. We have the four brands: ProQuest, UMI, Chadwyck-Healey, and XanEdu. The first three of those are the library brands;XanEdu is the new higher education brand.

We have the big aggregated newspaper and journals databases—such as ABI/INFORM and MEDLINE with Full Text, but we have also got the more niche products, like the Chadwyck-Healey humanities products. ProQuest was always strongin business and social science, and in STM; Chadwyck-Healey's strengths were in thehumanities. There was a good synergy between ProQuest and Chadwyck-Healeyin terms both of content and markets. For example, ProQuest was strong in Asia, while Chadwyck-Healey was strong in the U.K. and parts of Europe.

We are also not just publishing in the English language. In 2002, we completed two big non-Anglophone digitization projects: the Latin database, Acta Sanctorum, which [details] the lives of the saints, but [also offers] social history up to the middle ages; and the complete works ofMartin Luther in German.

[In 2002 we] also celebrated 10 years of digitizing the CPSU archives in Moscow. We've done 11 million pages of that so far. There remains, you see, a small core of research libraries that still want to collect for posterity, and on microform as well as electronic.

Our main competitors remain EBSCO and Gale. But the former don't have the niche products that we can boast, and the latter tend to go into different markets. And neither has the breadth we have.All that breadth and variety helps us to cope with more challenging years, such as 2002.

We've been staffing up in sales and marketing. For example, we opened an office in Japan at the end of 2001 in spite of the difficult trading conditions. For tworeasons: first, to provide some local support for our distributors there. And second, to get a more direct contact with the markets ourselves. It's worked very well. There have been no head-count reductions,and we [opened] an office in Rio de Janeiroin January. I just don't think the way to deal with difficult trading conditions is to cut the number of contacts you have with your customers.

Our priority for 2003 is to extend most of what we are already doing. The Historical Newspapers Project is absolutely central to new product development. Chadwyck-Healey will further develop the schools' product and the humanities databases. With XanEdu it's continuing to roll out the online course pack model, which has started to take off in 2002.

Geographically, Asia [is a priority, as are] the big digitization projects that we have—e.g., the historical U.S. newspapers. We did The New York Times and The Wall Street Journal in 2001, and The Washington Post and The Christian Science Monitor in 2002. We'll do a couple more [in 2003].

Those products are just at the beginning of their commercial lives. I think they will do tremendously well. The reference publishing business is also poised to grow. In Britain, our KnowUK product tends to be the first commercial product public libraries buy once they get online. For example, we have just done a deal in Scotland whereby every Scottish public library will get KnowUK. And then there is our U.K. schools publishing program in literature and history, which is tied into the national curriculum and is set to grow.

Clare Hart
Factiva
President and CEO

Despite harsh economic times, Factiva's operating income is still strong. When Factiva was formed in 1999, we inherited infrastructure from both Dow Jones Interactive and Reuters Business Briefing, including financial, HR, and many of the billing systems. Over the last 3 1/2 years, Factiva has upgraded its infrastructure and consolidated most of its systems.

We now have one financial system and one HR system, and a single intranet—an important internal communications vehicle within Factiva. Similarly, our marketing Web site enables us to provide better information to customers more quickly. At Factiva, we are big believers in e-learning and use it both to train customers on Factiva products and to train our own employees on a variety of topics.

In short, we've been able to manage costs through the efficiencies gained by infrastructure investments and through using tools and technologies that enable us to better serve our employees and customers. Further, at the end of 1999, we talked to about 300 individuals from 200 companies around the world, and we asked them, "What would you like to see in a news and information product?"

The feedback that we got caused us to accelerate our product-development efforts. We knew we were going to replace Dow Jones Interactive and Reuters Business Briefing with a destination product that has now become Factiva.com. But we were also listening to our customers say, "You need to do more in providing us tools and technology to integrate your content into our corporate knowledge management systems, our intranets, our enterprise information portals." This resulted in setting up a dual product strategy. Since the joint venture was formed, we've launched Factiva Publisher, Factiva Modules, Factiva Select, and Factiva.com.

In 2002 alone, we've launched Factiva Editor, Factiva Alerts, Factiva Public Figures & Associates, and most recently, Factiva Fusion. At the same time, we continue to enhance the Factiva products ... [including] the addition of a Japanese-language user interface. That's in addition to French, German, Spanish, and Italian, and we'll have Chinese and Russian shortly. We've also built in some other features,like split-screen capability, where users can look at the headlines on one side of the screen and open an article and read it on the other side. Historical market data and charting capabilities were also added.

Product continues to be a primary focus. At Factiva, our global marketing and business research teams are always looking at areas that are influencing the content business, whether it is knowledge management, content management, or CRM systems. These trends, in addition to the feedback we get from customers, continually influence where we go with our products and services.

Content, just like our product strategy,is driven largely by input from marketingand sales. So, adding important content from all parts of the world based on feedback from customers and salespeople havebeen key drivers. We're very driven by clearly defined, measurable goals, which has translated into strategic success. Of course, we're always setting new ones, so we'll have new goals in the coming years as we wrap up our upgrade in June.

Robert J. Massie
CAS (Chemical Abstracts Service)
Director

While the global economy has been struggling for the past 2 years, scientific research, patenting, and drug-discovery activities continue and are accelerating in many regions. Productivity-enhancing research tools, such as CAS databases and search-and-retrieval services, are more in demand today than ever. Consequently, CAS closed another record year in 2002, with double-digit growth in sales of our electronic product offerings. We are particularly pleased that SciFinder Scholar has been installed in nearly 700 universities in the past 4 years—a phenomenal pace.

CAS continues to be mission-driven. We integrate the highest-quality content, research tools, and the power of the Web to deliver the best digital information environment for scientific research, and we remain the world's foremost source of nearly 100 years of information in the physical and life sciences. CAS's pathways to published research are organized around chemical structure databases with more than 20 million organic and inorganic substances, 6.5 million reactions, and millions of individual calculated and experimental properties. CAS provides the world's only integrated source of data on chemistry-oriented patent and journal literature, with more than 22 million bibliographic records and more than 70 million citations mediated by a single indexing, search, retrieval, and display software system.

Comprehensiveness is not our only goal. CAS also maintains unsurpassed currencyin accessing critical new information. First-page patent data from the world's top-five patent-granting authorities are available within 2 days of publication, and those same patents are fully abstracted andindexed within 27 days—a record unmatched in the industry. In 2003, CAS will be adding features and enhancing its STN International online service, with an eye toward further facilitating the work of information professionals and patent searchers. For example, we will be expanding CAS's patent coverage with 10 additional countries. The SciFinder family of end-user products, now embraced as essential tools for chemical and related research, will continue to be enhanced as well. With more links to full-text resources, including patent literature, and an ever-growing configuration of structures, abstracts, reactions, and other chemical-related information, CAS looks forward to 2003 and beyond as we continue to meetour mission to support chemical and related research, patenting, and drug discovery around the world.

Philipp Neie
Swets Blackwell
CEO

Swets Blackwell had the most successful year in its history in 2001, and we shall achieve our growth targets from that for 2002. We have seen the opportunity in a market where many of our clients and prospects are struggling to make our value-add clear, and to increase our market share and revenue.

Our products and services help our customers save money. It is very clear that in times of economic difficulty companies look at what they are doing to optimize. In North America, we employ 250 people; globally 1,100. There has been no reduction in head count. In fact, the corporate, government, and medical sales force increased from seven positions in 2000 to 13 in 2002.

We are promoting the more granular side of the business. Our SwetsWise product is modular, and one of those is SwetsWise Subscriptions. This allows organizations to decentralize their purchasing decisions to the desktop from a library or information center, without losing control over spend. It gives more flexibility with more control. Using this tool enables organizations to save money, and that is very important in this economy.

Our priorities for 2003 are to continue to build our market share in those markets we have been able to address with SwetsWise, but have not exploited yet, especially corporate sectors that don't have libraries or information centers. We see dramatic expansion possibilities there. We are looking at more strategic alliances on the content side, with suppliers and our corporate and academic customers, in terms of multisite licensing and consortia. There is further growth potential in the academic sector, but significant growth will come from markets to which we have not had as much access.

We have been able to grow our customer base within 1 year for our SwetsWise productto over 1,000. One concrete example is a biotech customer. Biotechs tend not to have a library, be less than 10 years old, [and have] 20 to 50 researchers. Traditionally they have some sort of secretary who orders journals and searches the Web. They make ideal customers for SwetsWise.

Harry Regan
H.W. Wilson Co.
President and CEO

The H.W. Wilson Co. is 105 years old, so we've had some level of experience with regard to dealing with these downturns inthe economy over that time. And clearly we'd like to be doing better, but we understand the libraries themselves are having a difficult time, and we attempt to respond to that by working closely with them and maximizing the value of their subscription dollars.

We've taken steps—as we have in the past—to be sure that we are reducing, to the extent we can, the expenses we incur in producing data, which we provide to libraries. At the same time, we have not turned away from the company's main mission of making sure that they are—and remain—quality databases and providing the service that the library expects from the company. And again, we're looking at the company's internal operations to find ways in which we can work better, work smarter, and still provide the same level of service. That's pretty much how the company has responded to the downturns in the economy over the years and how the resilience of the company has gotten us through many of these periods over our history.

We try to limit [our priorities for 2003] so that we have a better chance of achieving them. The important ones include the introduction of a new WilsonWeb technology platform, which has been under development with the invaluable assistance of a cross-section of library customers for the past 2 years. Another priority we have is to complete a new internal editorial production system makeover, which will provide customers with more frequently updated content for all databases and opportunities for many new products that can be combinations of our existing data. We are keen to ensure that we help libraries maximize the value of the dollars they spend as we continue to provide high-quality editorial content they expect from the H.W. Wilson Co.

Mark Rowse
Ingenta
CEO

We're doing very well. In 2002 (our fiscal year ends on the 30th of September), we grew our revenues by 30 percent, and we expect comparable results for 2003. Wehave 230 publisher customers, we had over6.5 million user sessions in 2002, and there were 1.7 million documents downloaded. That's up 70 percent.

Although we're pleased with our results, we are growing less quickly than we want. We've taken a series of measures to reorganize the company. Our focus on our customers led us to concentrate our two offices, one in Oxford in the U.K., and the other in Cambridge, Mass., on serving the sales, marketing, and content management functions. In Bath [U.K.], we now have the data center only, and Providence, R.I., has engineers and developers. We are not looking for new business. We'd rather keep our existing customers happy while controlling our cost base. We think that our small size keeps us flexible.

In 2003, we will continue to grow and deliver excellent service to customers. We will have a pre-tax profit in 2002 and expect the same in 2003. Still, we have to balance growth with investor expectations.

Georg Friedrich Schultheiss
FIZ Karlsruhe
General Director

Our experience from the past has beenconfirmed that, in times of a recession economy or lower growth rates (or negative growth rates), information value is recovery. That means, from our figures, we have from the last year and since September recovered the valley, and we are stabilized at about the same as the year before, 2000, between [the] 2000 and 2001revenue stream. That means, in principle, if you include the price increases, it is a little bit lower, but it is not like in other market segments where you hear of a 20-percent decrease or 30-percent decrease or so.... We are more or less at a break-even in money.

As you know, we are working in the sci-tech area, and ... FIZ Karlsruhe is heavily working in the intellectual property protection area, patents—not so much trademarks. Trademarks is not so heavy, as we hear also from our friends and competitors like Questel•Orbit. In this area, the industry is aware that intellectual property protection and patents are one of the main pillars of the world trade system. If this fails, we are in a bad situation, not only the information providers—the whole economy will run into big trouble.

And therefore, especially in the areas with heavy investment in patents like healthcare, pharmacy, and chemistry, it is continuing. You have a stabilized usageof information and in-depth investigations of information sources and qualified information sources. And this is the music we are playing on the market, and not only [us, but] others as well. And this is received. One other important point is that [for] years we have very good contacts to our customers, and we are working hard to follow their needs.

Probably you know that only a few years ago we started—everybody started—to combine bibliographic databases with full-text supply and document delivery services, and this works quite well.

[One of my priorities for 2003 is] my retirement! I'm going to retire by the end of April when I finish my 65th year. I have to because it's governmental law in Germany. Then I'm going to work as an independent consultant. It will be my decisions then, finally.

But if you mean FIZ Karlsruhe, they are going to continue in the same way in this international connection together with Chemical Abstracts Service and the Japan Science and Technology Corp. We try to spread out our links to be a neutral platform for even competing services.

Dean Vogel
Ovid
CEO

Despite the sluggishness of the current economy, Ovid, I am pleased to say, is doing very well. There has been significant growth in the medical markets, which for us includes the hospital, teaching hospital, and medical library markets, and Ovid has experienced double-digit growth in those areas as a result. Academia, which is also a big market for us, has been a slow grower this year, with profits remaining relatively flat. However, these conditions are to be expected in this type of economic environment, and I think you'll find that a lot of companies are seeing similar trends. Overall, we're doing exceptionally well, and we are on pace to see double-digit growth for the year.

Our strategy has been, and will continue to be, investment and expansion; we don't anticipate any reductions or cutbacks anytime soon. Most recently, the bulk of our investment has been in the "customer-facing" areas. In fact, we have dedicated considerable resources to creating a new group, which focuses specifically on customer service. Patti Corbett, our vice president of marketing and customer development, is spearheading this important effort. We have also expanded our product management, sales, and sales support teams.

Also of note is our commitment to supporting technology development and innovation. Over the past year, we have made significant investments in projects such as our new U.K. Regional Data Center at Manchester Computing, which was created specifically to enhance the service we provide our European customers. We also continue to invest in loading full-text journals to our world-class collection of content. Actually, we added almost 400 additional journals this year and have truly strengthened our leadership position in the medical journal space.

2001 was a rather introspective year for us. As you know, we acquired SilverPlatter and invested a lot of time in setting our company's strategic direction. For 2003, our strategy is to execute on what we spent a lot of time and energy developing: a business dedicated to the customized delivery of content, tools, and services that best answer an organization's needs.

Recently, we have seen documentation of the importance of reliable medical information delivered at the point of care. Accordingly, one of our strategies for the coming year will be to create information solutions that contribute to the improved work flow of information professionals and clinicians in the medical environment.An example of that would be the integration of medical information into an electronic patient record.

Leo Voogt
Elsevier Science
Director of Global Library Relations,
Science & Technology

[We] are relatively economy-independent. Quite often if the economy is not doing so well certain research efforts will increase. And that is very good for our company, because that means that many institutions in the world will buy additional material from us—particularly in our present market where electronic publications are becoming far more important.

We have been very successful in selling ScienceDirect; we have already reached a very high market penetration. We are adding a lot of historical data to these particular products. We have more than 3 million articles available, and many of our customers [are] involved in the corporate and academic environments like this. And we have been very successful in selling what we call the back files for Elsevier ScienceDirect.

So overall, very positive. The new products and developments really compensate for the pressures we know to be there on the library budgets. The pressures are strong in the U.S., but we see expenditure in other areas and growth in areas that were formerly not growing as fast. The Chinese market is very important for us and continues to be important. So we see overall growth, but it's—I think—coming from different areas and regions as far as products and geography than it used to come before.

Yes, we recognize that there is turbulence in certain markets. Particularly in the U.S., there is a lot of pressure on budgets. In a way there are no special measures, but one thing we decided a couple of years ago is that we will do our utmost to deliver more value to the library community for basically the same or a slightly higher price. Among that of course is ScienceDirect and the 3 million articles [that are] available.And we have a strong drive in the company to help librarians increase the usage of our materials. If you look at what we call the "cost per article," we have a strong effort in our company to bring that cost down. That's very significant for libraries. The figure is quite often used of $30 per article. We have quite a number of customers in the world who are paying under a $10 level or even a $5 level per article when they have bought an institutional site license.

On a general level, we really tried hard to limit our price increases to our loyal customers—the first time ever in our company's history that we offered a 5-percent increase for next year across the board if you were a loyal Elsevier customer. That's been a breakthrough. Otherwise, you would get price increases that I would still consider moderate for the industry: 7 to 8 percent rather than the 10 to 15 percent that people were used to years ago.

There are two important messages: We've committed to increases below 10 percent. We've stuck to that promise and for those people that have gone the electronic route with us, we're saying we will ... give you a 5-percent increase, which is a very fair offer.

We are adding a lot of historical data—that's [a priority for 2003]. We've started something that we call Library Connect that will intensify further our contacts with the library community. We've got two advisory library boards, one European and one American, in operation.

Another important priority for 2003 is that we want to bring more content online. As we see libraries moving increasingly into the electronic-only area, we are trying to deliver reference content to our electronic platform as well. So one of the big things we'll focus on for 2003 will
be our electronic major reference works. We'll be launching the first of those in 2003, and we'll be very interested to see how that gets picked up in the library community. It's really a serious development effort, and we tried to bring that on the same platform as we deliver our journal information. So again, [we're] looking for maximum integration of services and products.