XML as Infrastructure in Internet Relationship Management   Table of contents   Indexes   XML does matter for next generation of "Plug &, Play" Electronic Commerce
 

XML and E-commerce: A Publisher's Perspective
 Nick   Arnold
  Head, Information Systems, Directorate for Public Affairs and Communication
  OECD  2, rue André-Pascal
Paris   75775 CEDEX 16  France
Phone: +33 (0)1.49.10.42.53
Fax: +33 (0)1.49.10.43.11
Email: nick.arnold@oecd.org Web: www.oecd.org
 
Biographical notice:
 
Nick Arnold manages the production, research and development, and Internet sections for the OECD's publishing activities. Prior to joining the OECD in 1990, Nick worked in New York in a variety of positions within the information management field.
 
ABSTRACT:
 
The OECD is a major international publisher in economics and societal issues. During the past year, the OECD has moved to promote and to sell its publications online. The speaker describes what the OECD has done and what online content providers are doing with XML and their near term plans. The early results have been promising and also surprising.
 

The OECD's publishing activities
 
The OECD is a major publisher in the field of economic and policy research. It publishes approximately 125 new monographs each year in French and English in addition to a wide range of journals, series and statistical periodicals. Much of this work is produced in both paper and electronic form. Over 200,000 people visit the OECD web site each month, where we make available 40,000 pages and files which represent a large subset of our publicly available information.
 
Today I would like to discuss the OECD's online commercial ventures and describe our basic business models and how they relate to XML.
 

Online activities
 

Online bookshop
 
I have been pleasantly surprised by the sucess of our online bookshop. We wanted to be present on the Web, but were cautious about the return on investment potential. So we launched it on a shoestring in early 1998. First year implementation and running costs were 30 500 euros. Direct sales were 48 000 euros. Follow up sales from people who didn't want to pay directly by credit card, but rather fax or mailed in their order form amounted to over 13 000 euros. So we doubled our money with no particular marketing efforts. Sales in the first quarter of 1999 are up 80% over the same period last year.

Monograph sales online
  
 
In the meantime, there have been some interesting developments. Amazon's affiliate program illustrates an appealing business model; custom links on targeted web sites that draw pre- qualified traffic to the vendor's catalogue. Whatever one might think of Amazon's long-term viability relative to their stock price, right now the virtual reseller model has a lot going for it.
 
We recently developed our own resellers network based on Imediation's software. Imediation is a French startup providing similar software and functionality to Be Free in the United States.

Current distribution network
  

New distribution network
  

Return on Investment calculation
  
 
It will be interesting to see how the virtual reseller model evolves in the face of widespread use of XML. Remember Junglee.com, which Amazon purchased for a few hundred million last year? While it didn't leverage XML directly, it did wrap the results in XML and returned a frictionless, effortless comparison of price, availability and shipping terms to the consumer's browser. One could easily imagine thousands of XML-enabled online catalogues searched by intelligent agents which return to the user the best deal based on their XML encoded profile. Gartner estimates that by 2001, global XML repositories will be sufficiently developed to facilitate XML interchange between applications. So we've got maybe a two year window to build our network, enhance our brand and build a loyal base of clients. Whatever happens, we're not too worried because all our key information is coded in XML. We'll be positioned to exploit whatever market opportunities develop.
 

Online aggregators
 
The other online commercial activity centers around providing a complementary electronic service to our global and selective standing order clients. These clients are typically large institutions and buy everything the OECD produces -- a global standing order -- or everything within a given category, like education or the environment -- selective standing order. Purchasing generally takes place through the central library.
 
Over 50% of our sales are to these institutional libraries who are under pressure to reduce their budgets. To stand out among the myriad information providers and remain on the libraries' buying list, we need to provide additional services at low or no additional cost. Institution-wide access to an electronic version of our printed publications is what they've told us they need and it's becoming a key point in keeping existing new clients, and essential for making new sales.
 
Librarians hate managing passwords, access rights and URLs. Consequently, this market is looking to aggregators to provide them with a single point of access to the information from numerous publisher's. Harvard and Stanford don't want to go to the OECD for OECD publications, the World Bank for its books, etc. Hence the aggregator has an important role to play in this area.
 
The current player's are Ingenta for technical journals, the big subscription agencies such as Blackwell, Dawson, Swets and Ebsco for journals and periodicals. To our surprise, each and every one of these companies wants our books in PDF format. We imagined that some would offer a hybrid service of some publishers' information in PDF, other in SGML/XML but that is not the case. They want XML metadata about the periodical or article, perhaps the abstract in XML, but the content itself is presented in PDF. Obviously, there's a market opportunity some point down the road for an aggregator who can gather a critical mass of XML content and exploit it, but we're not seeing that at this time.
 
In conclusion, the aggregator's are concentrating on critical information mass, consolidated billing, unique point of access and rights management while providing the content is PDF or native file formats, using the XML metadata for organising and searching. Watch this space but don't expect any broad movement by aggregators towards XML content before mid-2000.
 
That said, mid-2000 is not far away. We are well prepared for the day when XML content will constitute a critical market advantage. We started years ago by converting our production chain to SGML and now all new information systems are XML-based. All our bibliographic information can be exported to XML and we use this information to upload other bibliographic systems as well as our online bookshop.
 
From what we've heard from our clients and business partners, the immediate issue is getting the metadata in XML, that is, table of contents, abstracts, introductory matter, bibliographical data. For STM publishers, I would go further and strongly encourage you to add metadata onto tables, graphs and images. I think we'll see a gradual, but rapid, migration towards more enhanced search and retrieval for specific elements based on XML and in the STM world, one graph, easily found thanks to XML, is worth more than a thousand words.
 
I'd like to close with a quote from the Gartner Group on XML:
 
"Enterprises that dismiss the XML-based standards as futuristic or irrelevant will miss the greatest opportunity for process improvement since the introduction of the GUI. Enterprises should understand XML-based standards now."
 
I trust that this conference has been most helpful for you in meeting this challenge.
XML as Infrastructure in Internet Relationship Management   Table of contents   Indexes   XML does matter for next generation of "Plug &, Play" Electronic Commerce