Issues in multiple use and network pricing for CDROMs
| Pages | 483-488 |
| DOI | https://doi.org/10.1108/eb045416 |
| Date | 01 May 1995 |
| Published date | 01 May 1995 |
| Author | Jennifer Rowley |
| Subject Matter | Information & knowledge management,Library & information science |
Brief Communication
Issues in multiple use and network
pricing for CDROMs
Jennifer Rowley
School of Management and Social
Sciences,
Edge Hill
College
of Higher
Education, St Helens
Road,
Ormskirk,
Lancs. L39
4QP,
UK
E-mail:
rowleyj@admin.edge-hill-college.ac.uk
Abstract: In order to achieve an appropriate level of revenue, CDROM
publishers need to attempt to control access to their databases when
they are
used
in
a networked environment.
This
has led to the creation of interestingly complex
pricing strategies for the networked use of
CDROM.
This
article first
identifies
some of the key issues for pricing of CDROM and then focuses on the
issue
of
network
pricing,
using as case studies the network pricing strategies for
BIOSIS,
SilverPlatter, Dialog OnDisc and Reedbase. It
is
not clear whether
the
issue of
appropriate pricing strategies for CDROM will ultimately be viewed
as
so
intractable that suppliers will seek alternative distribution options.
1.
Introduction
The complexities of
the
electronic in-
formation marketplace pose difficul-
ties for both vendors and purchasers.
Vendors are hindered by inaccurate
prediction of specific pricing strate-
gies.
Purchasers find it difficult to
compare prices and to predict the
longer-term cost of acquisition of
elec-
tronic information that needs to be ac-
quired on a continuing basis. The
rapidly developing marketplace for
CDROMs has led to remarkably com-
plex pricing strategies. These pricing
strategies seek to protect the interests
of all parties in the creation and gen-
eration of CDROMs, including the
creator or originator of the intellectual
content, the publisher and the distribu-
tor. This is more difficult when mar-
keting electronic information than
when selling other goods and services.
Electronic information can be pack-
aged in an infinite variety of
ways
(in
different subsets and different
for-
mats) and it is difficult for the suppli-
ers to ensure that one sale to one user
does not undermine other
sales
to other
users.
In other words, one user might
pass on the information
in
electronic or
other forms to other users, or several
users might all access the same set of
data.
The process of re-packaging infor-
mation, or allowing several people ac-
cess to the same data, has become eas-
ier with improved computer systems
and enhanced storage capacity, tele-
communications, fax machines and
photocopiers. Until relatively re-
cently, online access to external data-
bases was a priority activity controlled
largely through librarians and other in-
termediaries. It was always possible to
download segments of databases and
to reuse that data in local information
systems. However, since many data-
bases were either bibliographic in na-
ture or, alternatively, the data
was
time
dependant, this was not a significant
issue and could be policed by licensing
arrangements signed between the on-
line host and the purchasing organisa-
tion. In a relatively small community
of users and hosts, any major trans-
gression of the licensing arrangement
was likely to be evident. In addition,
repackaging of significant sets of data
using a wordprocessing or desktop
publishing package required specialist
skills and was not easily accessible to
the average end-user. Today it is much
easier to import files into a wordproc-
essing package, to edit data and to rep-
resent bibliographic, full-text or statis-
tical data in a different format. This
together with the much wider avail-
ability of databases on CDROM has
posed significant problems for
CDROM publishers, and those prob-
lems are most evident in the context of
the use of CDROMs in in-house net-
works. In order
to
achieve an appropri-
ate level of revenue, CDROM publish-
ers need to attempt to control access to
their databases when they are used in a
networked environment. This has led
to the creation of interestingly com-
plex pricing strategies for the net-
worked use of CDROM. This article
first identifies some of the key issues
for the pricing of CDROM and then
focuses on the issue of network pricing
as a strategy for controlling multiple
access to databases.
2.
Influences on pricing strategies
for CDROM
'The lack of attention paid to market-
ing is perhaps the greatest strategic er-
ror made by the information industry'
(Hauge 1986). 'Unfortunately the lit-
erature about the marketing of online
services, databases and CDROM
products is not well developed' (Ar-
nold 1990).
The above quotations emphasise
the relative paucity of attention to mar-
keting issues in the information indus-
try. As Arnold (1990) says, 'pricing
and marketing are interdependent.' In-
deed, in traditional marketing terms
price is one of the four marketing mix
variables; the others being product,
promotion and distribution.
The pricing strategies adopted by
the suppliers of CDROM reflect the
nature of the marketplace. In general
The Electronic Library, Vol. 13, No. 5, October 1995 483
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