The library technology industry will face one of its most challenging periods as a result of the global pandemic crisis. Libraries have rallied to protect their workers and their patrons through closures of their physical facilities and careful reintroduction of services that can be provided safely. Yet, there will undoubtedly be a more enduring economic impact on libraries and on the vendors that serve them. Libraries and their parent institutions will likely see painful budget reductions for multiple years. Each Library sectors may see different budget trajectories, but the library technology industry as a whole is not likely to remain unscathed.
Apart from the current crisis, the past few years have seen a downward trend in the number of major library system procurements in both the public and academic library sectors. The libraries.org database in Library Technology Guides tracks the number of new-system contracts for integrated library systems or library services platforms. The trajectory of new system procurements peaked in 2011 for both public and academic libraries in the United States, with a general pattern of slowing since then. The number of new contracts in the last few years was at one of the lowest points in the history of the industry. While the number of procurements was low, we also observe that many of these projects involved large numbers of libraries. The percentage of US public libraries purchasing new systems (1%) was substantially lower than US academics (6%). [See https://library technology.org/products/procurements/ for data trends. A more detailed discussion of this topic can be seen in the forthcoming November/December 2020 issue of Library Technology Reports.]
The combination of the ongoing trend of decreasing sales opportunities and library budget constraints will place the library technology industry under enormous pressure. The normal levels of economic pressures have driven continual rounds of mergers and acquisitions. While it is difficult to predict the outcome of amplified economic pressure, we can anticipate some possibilities.
- Some libraries may defer planned system replacements unless they can produce short-term budget savings. These deferrals may come just as much out of the intense struggle to accomplish the ongoing work of the library while many personnel work from home and the many other factors disrupting existing procedures and policies.
- Transitions from individual library implementations to shared consortial systems may be able to produce lower technology costs per institution and increased impact of collection resources. Discrete institutional system implementations represent the most costly model of automation and may be a luxury many libraries will not be able to justify in times of extreme budget pressures.
- New or expanded resource sharing environments will likely emerge. Reduction of collection budgets will drive the need for efficient and expedited access to resources from a broader communities of libraries.
- A possible acceleration of mergers and acquisitions. Stagnant or lower revenue may drive companies to pursue new ownership or investment opportunities. The historical stability of the library economy may likewise encourage higher-level companies to make strategic acquisitions even during a harsh short-term business phase.
- Libraries face urgent demands to provide ever more effective services for their patrons and gain operational efficiencies in response to reduced personnel budgets. These concerns will drive demand for technology products that meet these requirements. To build community support to sustain financial support, libraries will increasingly invest in advanced marketing tools. In an environment of mature resource management systems, new products must emphasize patron-facing capabilities. We can expect the next phase of technology development for libraries to focus intensely on patron services.
- New collection development patterns may drive the need for corresponding enhancements to technology and business systems. Examples include: analytics to help libraries identify priority subscription renewals; tools to manage accelerating transitions to open access content; and systems or integrations to support new or expanded resource sharing arrangements.
- In the immediate term, developers of library software must rapidly develop and deploy tools to help libraries cope with the pandemic crisis, supporting new workflows that ensure health safety and maximize access to materials and services. This issue of Smart Libraries Newsletter includes some recent accomplishments in this area.
Naturally, many of these assertions are speculative. The library community can hope for less drastic trends, but must also prepare for a harsh reality for some time. Look to this newsletter for reporting and perspective on any related events that play out in the next phase of the library technology industry.