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Smarter Libraries through Technology: The Stewards of Library Technology

Smart Libraries Newsletter [July 2019]

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One aspect of the library technology that I find interesting concerns the diverse ownership arrangements of the companies and organizations that provide technology products and services to libraries. The mix includes for-profit commercial companies and non-profit organizations. The commercial companies fall under differing ownership arrangements, such as those that are privately held by the founding owner or family, those controlled by investment firms, publicly traded companies, as well as those with hybrid ownership structures.

The following companies are a few of the major players that illustrate the diversity of organizational structures in the industry.

Auto-Graphics is a for-profit publicly traded company, the primary operating company of Agent Information Software (AIS). Contrary to the norm that public companies tend to be quite large, Auto-Graphics is a mid-sized company. Most of the shares are held by the founding family. Paul R. Cope currently serves as the CEO and is the third generation in the family to lead the company. The company was founded as Cope Typesetting by Ira C. Cope in 1950.

OCLC is a non-profit cooperative, organized as a 501 (c) 3 in the state of Ohio. The EMEA division is a for-profit company, wholly owned by OCLC. Under European business regulations, business activities like those conducted by OCLC do not qualify as charitable organizations.

Equinox Open Software Initiative has operated under multiple business models. It was initially founded in 2007 as a forprofit company to provide development and support for the open source Evergreen ILS and transitioned to non-profit status in January 2017.

EBSCO Information Services is a for-profit company owned by EBSCO Industries. EBSCO is a longstanding family- owned company, founded by Elton B. Stephens in 1944. The company has grown continuously through business acquisitions and organically through the development and sales of its internally developed products.

SirsiDynix is a consolidated company created through many rounds of mergers and acquisitions. The company is currently owned by Inner City Ventures (ICV), a minority-owned and operated private equity investment firm.

Innovative Interfaces, Inc. was a company with longstanding private ownership until it was acquired by a pair of private equity investment firms, JMI Private Equity and Huntsman Gay Global Capital (now HGGC). Since its acquisition, the company has made business acquisitions including Polaris Library Systems and VTLS.

ByWater Solutions is a privately held company owned by its founders Brendan A. Gallagher and Nathan A. Curulla. The company was launched in 2009 to provide support services for Koha and other open source software.

The Library Corporation (TLC) can be considered the most longstanding founder-owned companies. It was co-founded in 1974 by Annette Harwood Murphy, who continues to lead the company as its President and Chief Executive Officer. TLC acquired Carl Corporation in 2000 and Tech Logic Corporation in 2005.

In my three decades of involvement with the library technology industry, I have not been able to observe any strong association between the ownership arrangements and pricing or the quality of the products and services from the organizations involved. The non-profit organizations face the same business challenges as the for-profit companies. They must operate with a sustainable business plan, with revenue exceeding expenses handled differently. OCLC, as the leading non-profit in the industry, participates in the same competitive environment as commercial companies for many of its products. The performance of the investor-owned companies has been mixed. Some investors have exercised constraint and control over their portfolio companies while others have empowered existing management to pursue established and successful business strategies. Founder or family owned companies tend to exhibit more long-term stability, though with differing levels of product innovation.

All that is not to say that libraries should pay attention to the ownership status of the companies with which they engage for technology products and services. These engagements are long-term partnerships involving products that can strengthen or hinder the library's ability to operate efficiently and achieve its mission for the community it serves. But rather than make judgements regarding the category of the business arrangement, it's more important to evaluate the organization itself, its leadership, and its personnel.

Each company in the industry has its unique character, shaped by the current leadership, financial backers, and its corporate culture and background. As libraries acquire technology products, it is important to take into consideration not just the current snapshot of features and functions, but also to get some insight to its future directions and potential. It's this need to understand as much as possible about business context that most features in this newsletter usually include a section about the background of the organizations involved.

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Publication Year:2019
Type of Material:Article
Language English
Published in: Smart Libraries Newsletter
Publication Info:Volume 39 Number 07
Issue:July 2019
Publisher:ALA TechSource
Series: Smarter Libraries through Technology
Place of Publication:Chicago, IL
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Record Number:24473
Last Update:2022-12-05 14:46:33
Date Created:2019-07-26 07:57:36