Library economics in the new media era

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Library economics in the new media era

Holt's Perspectives

by Glen Holt, published December 3, 2007

My personal statement of chaos theory (you will recall that a butterfly’s wing flutter may cause a tornado on the other side of the earth) is the simplistic notion that lots of things have a way of affecting lots of other things I care about, including libraries, often without anyone making the connections.

Several news stories I read in the last few weeks made me put some more pieces together under the title of chaotic change and the changing future of library economics. Here is my perspective.

The first flutter of wings I noticed, this one from our side of the earth, comes from Poynter (Journalism) Institute’s Senior Scholar Roy Peter Clark when he poses “the big question” about the future of newspapers, and, implicitly, about the future of libraries, in his October 11, 2007, electronic column. He writes:

There is one overriding question about the future of journalism that no one can yet answer: How will we pay for it? Who will pay for good reporters and editors? Who will pay to station them in statehouses, or send them to cover wars and disasters? Who will finance important investigations in support of the public's health and safety?

Clark’s question--“Who will pay?”--is a result of chaotic change in the newspaper business. The Internet, like television and radio before it, has brought us faster, more variously sourced and more personally controlled coverage of all topics than most daily newspapers do. We have a sense that electronic news sources are free, or--as in the case of many paper-based magazines, deeply discounted--and we have to pay for newspaper subscriptions even when their offerings seem boring or irrelevant.

The problem is that all but a few newspapers have lost their historic mass middle-class, commuter or along-with-meal reader market. Except for the few “national newspapers,” none of the solutions (e.g. higher quality, tonier features, more gossip, more analysis, more sports, cheapening production, firing or retiring expensive reporters, or going to tabloid size and sleaze) seems to regain or hold readership. The economic result has been continuing consolidations. And, still the ex-sanguinations of subscriptions continues.

So Roy Peter Clark, like thousands of reformers before him who have no better idea on how to brighten the future of their profession, calls on “good citizens” to do their duty. In Clark’s case, his story sub-title reveals his reformist notion: “Your duty to read the [news]paper. If we believe in a future of journalism, we’ve got to pitch in.”

What a strange plea for American voluntarism! It sounds more like a call for a Boy Scout old-newspaper drive than a way to solidify the economics of modern journalism.

Let’s add one other complexity to the economic chaos of Roy Peter Clark’s industry. The newspaper business and other paper-based book and magazine publishers have long been among the largest monetary beneficiaries of naughty environmental practices like clear-cutting forests and dropping nasty chemicals into streams in the manufacture of their base product. With environmentalism favored by two out of three US citizens as one of the issues that government ought to get busy on, the costs of paper already has started to rise precipitously-–and greater increases in all paper costs should be expected. (See Ruy Teixeira. What the Public Really Wants on Budget Priorities. Center for American Progress. November 7, 2007.)

I’ve always thought that newspapers with their mass subscription bases run a close business parallel to public libraries, which by and large depend on similar mass-subscriptions of literate cardholder/supporter/taxpayers for their usage. Both businesses have built their business by catering to broad middle-class markets.

Now mass markets are narrowing, cut down by continuing losses to smaller and smaller consumption communities, especially those based in electronic self-definition. Wallowing in this riptide, most newspapers still have not found a really good way to answer the question, “Who will pay?” Lots of libraries, facing the same changes, are finding it difficult to win funding support for their operations as well.

So, how do you think the current newspaper wars will play out? In spite of innovative and creative efforts like that of the former editor of the Minneapolis Star Tribune to start a subscription-supported, electronic Minnpost.com (as noted by Rick Edmonds in "Old Media Meets New in Minnesota," Poynteronline, Aug. 30, 2007) is the typical metro daily newspaper on the way to its death or some transformation that will make it unrecognizable? And do you think that the niche-market trend that has affected newspapers is already having an impact on libraries? I certainly do.

Roy Peter Clark's story is about old media. The next flutter of butterfly wings causing chaos can be seen in a lamentation about new media. It comes from Jaron Lanier, a computer scientist and a columnist for Discover Magazine, a subscription journal available in paper and online. Lanier says:

There’s an almost religious belief in the [Silicon] Valley that charging for content is bad. The only business plan in sight is ever more advertising... How long must creative people wait for the Web’s new wealth to find a path to their doors?... To help writers and artists earn a living online, software engineers and Internet evangelists need to exercise the power they hold as designers... We could design information systems so that people can pay for content--so that anyone has the chance of becoming a widely read author and yet can also be paid. Information could be universally accessible but on an affordable instead of an absolutely free basis.
People happily pay for content in certain Internet ecosystems, provided the ecosystems are delightful...in virtual worlds like Second Life, for instance. Something similar is going on for music within the ecosystem of the iPod.

Lanier’s lament is “We who write and create for the electronic media are not making any money either.” Not writers, perhaps, but money is being made in the new media--by creators, aggregators and purveyors who organize new business models. Lanier himself notes that content aggregators who design “delightful” Net-based ecosystems like Second Life and iPod make lots of money. And just like all those niche-market newspaper-and-magazine publishers have done since the printing press was invented, the new aggregators are reshaping the marketplace to their own profit-making business models.

Unfortunately, Lanier is overly general in his attack on the new media for not paying. The reality instead is that new media authors and aggregators like Lanier want to be paid under the rules of the Old Media Empire (i.e. copyright and fair use) even while nearly everyone with any brains knows that the old system barely worked and is not working at all in the New Media Empire world.

Alas, technological revolutions always have been like this. The electric power industry, the automobile, the mechanical combine, the steam shovel, the computer and computerized electronic communication had to travel through the same wasteful, painful, episodic mess of innovation and business development before some individual figured out how to create a mechanism that would pay creator, aggregator and purveyor alike.

What is manifest in this Old Media/New Media transformation is that it involves the economic foundation on which libraries are based. That’s because computers and multiple new avenues of electronic communication call into question the need for libraries and individuals to collect and then provide public access to physical information and data collections that are to be found or used only within specific buildings.

Let me give you a personal example. Working over two decades in the early part of my professional career, I collected more than 10,000 books and paper items in my personal research library. That collection, which filled many rooms in my house, my office and my library carrel--plus multiple boxes in my basement--included many scarce and rare books, typewritten reports and many one-of-the-few-remaining copies of government agency reports often long out of print. I used items from that collection almost every day in my research and writing.

Then one day about ten years ago, I gave almost all of those materials to two different libraries. Why? Because by then it had become so easy to get at most of the research materials I needed via electronic pathways, that holding and managing my personal collection was more trouble and a greater expense than I thought it worth. And, that’s how I first recognized that the whole economic basis of collections--and, therefore, libraries--had changed.

When we talk about libraries, we always have to remember that nagging reminder that the character Lenny received in that fairly obscure movie, Memento (2000). "Somebody has to pay, Lenny,” he was told. “Somebody always pays.”

The current writers’ strike in Hollywood is a New Media Era manifestation of Roy Peter Clark’s lament about the economics of creation, aggregation and purveying (i.e. distribution). The central issue is how broadband, high-speed connection is affecting an old question, i.e. the issue of residuals for “republication” in similar or new kinds of electronic publication or programming outlets. The writers acknowledge that they have been paid for their act of original creation. But the new electronic power of distribution using multiple economic technologies has increased residual opportunities.

Like copyright laws, rules for distributing residuals are at best old-fashioned and all but irrelevant in the New Media Era. Recognizing this reality, the writers are asking, “How much shall writers be paid, for how many replaying of the programs, in what formats and over what length of time?” And the people who own the programs generated from the writers’ creative acts are responding, “We produced the product, we aggregated the productions and we can do pretty much what we want with the residuals.” The writers are saying, “No, we want our share of the profits from all distributions in the New Media Era economy." As this article goes to publication, the strike still is under way. One electronic outlet’s strike newsletter headlines read, “Sides still talking, WGA still walking.”

As the Hollywood Writers Guild strike continues, another strike is over. That is the strike of nearly 800 library workers in Vancouver, Canada.

The first reason this strike is fascinating is because it lasted 86-to-89 days, which, depending on how you count the time of starting and stopping the strike, is some 87-to-88 days longer than the walkout of those US automobile union-toughies who struck GM and Ford.

The strike also was important because it was about white-collar work issues of the New Media Era. These issues included pay equity for comparably difficult or complex work in predominantly male or female job categories. According to CUPE (Canadian Union of Public Employees) representing the library staffers, the central issue was pay increases for lower-paid library workers, 300 of whom were going to get only 4% raises while more than 200 workers in upper categories were going to be bumped up one pay grade, a shift that amounted to a substantial raise.

Here then were good modern equity issues, literate workers and a public business that the public say they like and support. And in the beginning, workers appeared united on the issues. So, they walked--on July 29, 2007.

Three months later, with the holiday season approaching and family budgets under strain, the strike came to an end. Here is the announcement from the union made as the library workers returned to work.

The votes are in. 71.4% of the membership have said yes to the memorandum of agreement and a return to work.

The Vancouver Public Library Board ratified the agreement 10/20/2007.

We are pleased to be back so that we can once again offer to the citizens of Vancouver access to the great service that each and every one of the membership provides. Unfortunately, this is a bittersweet sentiment, as more than half of our membership have not had this work fully recognized in this new collective agreement.
Nevertheless, the fight for our issues, in particular the fight for Pay Equity, will continue beyond the venue of the bargaining table, and we believe we will one day soon realize our goals.

In other words, the strike was over. Operating within a long tradition of public-sector unions, the Canadian library workers had demonstrated that they could strike, bargain, obtain mediation and make modest salary gains–-but lots of New Media work issues, especially pay equity, were left unresolved.

As the Vancouver strike endured, a different set of New Media Era economics issues were affecting users and workers of the 15-facility library system in Medford, OR. Headlining the story, the International Herald Tribune noted, “To save money, American towns contracting private companies to run public libraries.” Adding details, the story noted:

The contract with LSSI [Library System Services LLC., a private-sector vendor that has operated a number of libraries for both Federal and local governments will be worth around $3 million (€2.1 million) a year; the county will also budget $1.3 million (€920,000) to maintain the buildings. Combined, that is about half of the $8 million (€5.7 million) a year the county previously spent on its libraries.
However, the libraries will be open only 24 hours a week, compared with 40-plus hours for most branches before the shutdown. And LSSI plans to hire 50 to 60 full-time employees, down from 88 under county management.
The county will retain control over certain policies, such as late fees, the cost of a library card, or how long library patrons can keep a best-seller.

Jim Olney, director of the Jackson County (OR) Library Foundation, considers himself a union supporter, but said: “Look, if it is either lose the libraries or outsource them, we’d rather have outsourcing. Sometimes you have to go for the difficult choice because there is no easy choice."

Olney’s comment reflects the changing financial situation in which not only many public libraries but many government agencies including schools and universities find themselves: Through the past few decades, public support for historically tax-supported public institutions, including libraries, has waned.

The shift can be seen in dozens of institutional modifications, including the privatization of US prisons, charter schools and entrepreneurial universities. Venture capitalists also are chasing pieces of the federal expressway system and several major and heavily-used bridges. Contracts and user fees could just as easily become a way of life in libraries as they have in other public sector operations. LSSI’s business success through the last decade is one indication of the growth of private-sector operations of libraries. If current public sector trends continue, many more libraries will fall into the same category.

This waning of government support for libraries is reflected as well in the 2004 report of the Plural Funding Project entitled Saving America’s Libraries: Changing the Model for Public Library Funds Development. The proposed “solution” to public library funding issues is to suggest a return to an early part of library history when libraries operated with philanthropic funds and public funding rather than placing so much reliance on public funding alone. The group of organizations that supported the Plural Funding Project went on to suggest that a New Media Era funding model already existed in the form of how National Public Radio stations secured their funds.

In general the library profession treated the Plural Funding Project report like a visit from an unwanted and unpleasant relative. Of course, the greater reality is that except perhaps for university and college libraries, other libraries--school, public and special--are bound so thoroughly into local and state constituent politics that most national trends can be safely ignored.

That’s another way of saying that the library profession generally needs to deal specifically with the issues raised by the changes that have occurred in the New Media Era.

The first and greatest change is the shift to digital publishing, databases and information dissemination has decreased fundamentally the value of library material collections and has allowed individuals to transform their personal ways of acquiring the data, information and knowledge they want and believe they need.

When individuals or groups suggest that “We can get rid of libraries,” they most often are premising that claim on the belief that “In my work and personal life I don’t need the information or books or magazines that libraries have because I can get what I need faster and cheaper on the Internet than I can by a physical trip to a place called a library."

Librarians who recognize the often correct premise of this claim are already busy changing their libraries’ business offerings to meet the needs of current and different potential customers. Naïve librarians, meanwhile, are attending yet one more seminar on “Selling your Library” or “Marketing your Library’s Collections.”

What the issues examined in this column suggest is how fundamentally the value of libraries and library collections has shifted from their positions in the Old Media Era to those in the New Media era.

  • Who will pay for creative work has been opened to question as has the value of physical collections in organized storage facilities compared with “placeless” resources.
  • Cataloging individual items by skilled individuals is among most libraries’ most significant personnel expenses. “Social tagging” and Wikipedia-style updating is far cheaper and is built upon the decision-making of crowds rather than singularly applied rules.
  • The value of individual and collective creativity is being redefined hugely as reflected in the current definitions of two words: “authorship” and “mash-up.” The first suggests acknowledged authorship; the second suggests unregulated borrowing from many different media and distribution sources.
  • The value of library work, especially of clerical and semi-skilled staff, is being called into question, a fact reflected in salary issues, staff cuts and labor actions. The very word, “librarian,” has lost some of its Old Media Era magic, because of a public perception that librarians are so closely associated with particular things, specifically books.
  • Last but not least, there is the growing issue of the value of libraries as commonweal--i.e. general welfare--institutions. The reason for taxes of any kind is that there has been a widely accepted belief in the US that some activities are better done by government “in the public interest” rather than privately for the benefit of specific interest groups.

Through the last four decades, respect for commonweal activities and belief that we ought to pay for such activities with taxes has declined just as surely as the tides go out on a regular basis. This question is undeniably economic and political. It does not require fancier marketing but a look at controlling library costs and examining what library services current and potential users really want and need. It means organizing and delivering those services--and “experiences” that those same users want--in an efficient and effective way.

Libraries are all caught up in the economic issues of the New Media Era. In response to those changing economic issues, our professional leaders and library professionals as a whole are going to have to make tough decisions to create a bright future for our libraries.

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