In 2014, the library-technology industry saw another phase of consolidation. Innovative expanded through its acquisitions of Polaris Library Systems and VTLS. SirsiDynix extended its reach further into the special libraries realm by purchasing EOS. As long as I have been following the industry, there has been a steady march of mergers and acquisitions that have reshaped the industry.
One component of the change relates to the increased involvement of private equity firms as they gain ownership of companies from the individuals or families that originally founded them. Some companies, such as Ex Libris Group, have changed hands multiple times. Private equity ownership seems like a good fit for the library industry since these firms tend to look more for long-term growth and building value of their portfolio companies over time. Most hold on to their investments for 5 to 10 years, expect to make reasonable profits along the way, and to build companies with higher value at the end of the investment. In contrast, venture capital seeks shorter-term opportunities, usually focusing on companies early in their business cycle.
Through these previous rounds of consolidation, the strategic products and technologies used by libraries remain under the control of fewer companies of larger size and capacity. This stands in contrast to a decade or so ago when there was a much larger number of companies competing with overlapping products within a finite economic universe. The development capacity of each company at that time was limited. This resulted in a slower pace of innovation, which left libraries with underpowered automation systems that did not keep up with the transitions already underway for collections comprising increasing proportions of electronic and digital content.
Looking into the next year or two, I anticipate that the consolidation of the industry will continue. I am not aware of any particular deals underway, but I expect some of the small-to-midsize companies in the global industry to attract the interest of larger organizations looking for interesting technologies or expansion into other niche market segments. It is not necessarily possible to predict the level of consolidation that might eventually be realized.
However, it is inevitable that the industry will be dominated by a shrinking tier of very large corporations. That top tier may contract, but I think that there will continue to be significant competition among those providing strategic technology products in each of the major library sectors: academic, public, school, and special. Consolidation to the point of monopoly for any of these sectors would face regulatory challenges and not be well-received in the respective library communities. In such cases, additional competitors would be supported either through new commercial entrants or via open source alternatives.
It is also likely that at least one major library-technology company will see a new ownership arrangement in 2015. The likeliest scenario is a transition to new private equity investors. In other industries—especially those involving much larger players—possible outcomes include a transition to publicly traded companies. Even the largest library-technology companies remain well below the scale of organizations that would exit from private equity ownership through an initial public offering.
As larger companies dominate the industry, libraries should demand extremely high levels of innovation and quality of service. The concentration of resources among a small number of technology providers will be tolerated only to the extent that they produce software and services far above what would be possible through smaller organizations with more limited development capacity. If the process of consolidation results in companies with business models dominated by cost-cutting, limited development, or other short-term strategies, libraries will soon seek alternatives.
Libraries tend to keep their strategic systems for a decade or more, as well as to expect corporate stability and long-term development road maps for these products. In most cases, these long-term strategies must endure through multiple ownership arrangements. Investors that seek to find short-term gains through the ownership of a library automation company will be frustrated by the modest growth opportunities and business cycles that depend on long-term development agendas.
Linked Data Opportunities
The next year will see considerable activity based on linked data. The last year or so has seen intense interest in linked data, which sparked many initiatives and development projects. In the realm of library-oriented bibliographic data, the Library of Congress (LC) established its initiative for bibliographic transformation, resulting in BIBFRAME, which is a mapping of MARC into linked data. BIBFRAME represents a major step toward the operational use of linked data in the realm of resource management and discovery services. None of the commercial products have been re-engineered to use BIBFRAME—rather than MARC—as the heart of their bibliographic description components. However, we do see evidence of planning and experimentation.
The next year or so will see linked data move from its current stage—characterized by conceptual discussion and experimentation—to prototypical development and pilot implementations. I anticipate that resource management systems might make the transition from MARC to BIBFRAME in the next 3 to 5 years. It is likely that systems would support BIBFRAME as an option rather than a wholesale replacement. The massive number of MARC records in use today will require a fairly long transition to any new metadata carrier.
The adoption of BIBFRAME could be accelerated through innovative products and services that demonstrate its value in ways that might not be possible through the established MARC formats. It is critical for libraries to adopt broadly accepted metadata expressions (such as linked data) rather than those we invented and deployed only within our individual systems. Linked data provides the opportunity to break away from esoteric library-specific constructs to those more consistent with semantic web technologies embraced by the broader realm of information technologies.
It seems to me that libraries have been relatively slow to adapt their web-oriented services to the reality of the dominance of mobile access. Accessing the web via mobile devices continues to increase. While the actual proportions vary by the nature of the service, it is clear that the tipping points have been reached. It is no longer tenable to offer services that are not optimized for small devices. Mobile support should move into the realm of standard expectations and not as an additional add-on product.
In the same way that we expect any product or service to support the major web browsers, they should also follow principals of responsive web design and scale functionality to the size and capabilities of the full spectrum of devices. Staff-oriented interfaces may need to be optimized for web browsers running on full-size screens to accommodate ergonomic issues and functional complexity. User-facing interfaces need to perform reasonably well when used from a smartphone and deliver more complex functionality for those accessing them via laptop, desktop, computer, or tablet.
Support for mobile is a critical issue that will receive overdue attention in the coming year. Libraries have become increasingly aware of this issue and are rapidly upgrading their web presence to support mobile access. Those developing products for libraries that involve patron access will accelerate development of mobile-friendly interfaces. In the commercial realm, mobile support will be considered a point of competitive differentiation.
3D Printing and Makerspaces
This year was one of excitement surrounding libraries providing 3D printers as part of a new wave of innovative services. In the coming year, I think this excitement will cool as these devices move more into the realm of commodity technology. Libraries provide printing services to meet the demand for delivery of library-oriented content resources and for routine tasks such as printing job applications, resumes, course work, or other activities. Printing long ago moved from the realm of innovative service to a burden that libraries need to provide, but that must be managed and metered. 3D printing has also graduated out of its innovation phase. It may become a standard library feature (in learning commons or innovation labs), enabling production and creation, but it may no longer be considered as a cutting-edge innovation.
Technology to Enhance the Physical Library Experience
A technology that I think will gain some traction in libraries in the next year or so is near field communication (NFC). It allows interaction between consumer devices, including many smartphones and inventory or payment systems. For example, the Apple iPhone 6 was designed with NFC capabilities. The initial version is limited to the Apple Pay commerce system, with the technology open to developers for the creation of additional applications in a year. Samsung and other smartphone manufactures have already implemented NFC with no such restrictions. These dynamics seem to point toward a broader use of NFC for additional applications toward the end of next year.
Libraries have been using radio frequency identification (RFID) technologies for years, enabling increased staff efficiency in the circulation and management of physical collection items, functioning essentially as a high-tech—and more expensive—bar code. Since it is tied to the computational power of smartphones (including location services), NFC offers some interesting possibilities for more innovative applications in libraries. I see considerable potential for library- and vendor-developed products and services that will enable more meaningful and productive interactions between library patrons and the content items and services in the physical library.
Apple's iBeaon provides another approach for intelligent technology-based interactions between patrons and physical facilities. Based on Bluetooth low energy transmissions, organizations can plant beacon devices in their facilities to push notifications to smartphones when a person enters a given physical area. While designed for the retail sector, this technology also has considerable potential for libraries.
A few years ago, QR codes were quite the topic of conversation as an example of a new technology that would benefit libraries. These “quick response” images can be read by a mobile device to instantly present a specific webpage that might provide additional content of interest related to an item in the physical world. For example, scanning a QR code on a movie poster can launch a video of its trailer. However, I have not necessarily seen compelling use cases for QR codes in libraries. Bar codes have been a standard way of linking individual pieces of content to circulation and other services. QR codes may provide a few interesting use cases in a library setting, but they have not made a major impact. I've even seen considerable misuse of the technology, such as placing a QR code on a webpage.
Regardless of whether these specific predictions play out as I have described them, libraries are at an interesting and important phase relative to their adoption of technology. Given the increasing pressure on libraries relative to budgets—and the increasing overlap or competition between services offered by libraries and the commercial sector—we need to take advantage of all the tools at our disposal. In addition to the energy, creativity, and passion of the individuals who work in libraries, technology stands as an important factor that enables libraries to prosper and successfully serve their communities.