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OCLC’s Crisis Moment

Innovative Interfaces and its joined-at-the-hip cataloging-company SkyRiver have teamed up to sue OCLC for monopolistic practices. I read the complaint end-to-end today and you can read my somewhat tame, won’t-you-be-my-neighbor assessment on the Chronicle of Higher Ed.

My more passionate, from-the-heart assessment: OCLC is a galumphing behemoth, often clumsily distant from its own kith and kin, with chronic governance issues, a deficit of social acumen, and a palpable mistrust of its membership. But OCLC is our behemoth–yours and mine. If we are going to have a worldwide catalog, it’s going to be a behemoth. Better it be a behemoth that needs to be not-so-gently bumped toward transparency and member participation than a for-profit behemoth in it for itself.

Not only that, but I found myself growing indignant over III’s repeated claim that OCLC users are forced to take part in development of their own products. If there is one solid value I acquired during my time working for a vendor supporting open-source software, it is that participating in the development of the tools I use is a strong positive (and I have yet to feel compelled to participate in product design–if anything, we have to ingratiate ourselves into the process). Co-design is good for me and it is good for the developers and it is good for LibraryLand.  What exactly is III saying–that we are too stupid to participate in the design of the tools we use?

My more pragmatic assessment: when you see a lawsuit over competing technologies, you can be sure some technology is jumping the shark. III (let’s be clear who’s behind this lawsuit–they have some nerve hiding behind SkyRiver’s skirts) needs to stop OCLC, fast, before everyone figures out that because OCLC accidentally created an international cloud-based service forty years ago, OCLC now has an inherent advantage because its technologies are based on web-scale services.

Let me put it another way. If you were designing a library catalog and a resource-sharing service today (or any web-based service, for that matter), what would predominate in your design principles? Would you require users to create discrete local silos duplicating common information that had to be constantly synced and groomed between the two databases, and then ask them to invest far more time in linking these silos through more applications and standards (and, ahem, money)?

That is how the traditional library catalog is designed. I have records in the cloud, and I have records in my local database, and I spend far too much time muddling between the two data sets, and making these data sets coordinate with other data sets, and spending money so that data set A can communicate with data set B. Why do I need local data? The answer is, I don’t, or at least, once OCLC gets its web-based catalog system working, I won’t.

III also fears Navigator, OCLC’s resource-sharing software, and rightly so. Would you design a resource-sharing system as a closed loop (an *expensive* closed loop), so that discovery outside this loop required a fresh search and knowledge of how to conduct it, or would you leverage the ability to make discovery a smooth ripple from the user’s home library through a consortium and on to a global catalog?  That’s a no-brainer. MPOW is a proud pioneer in the SCELC Camino project, which is beginning with a handful of private university libraries but will soon grow beyond that.

I know OCLC doesn’t come cheap, and for a nonprofit, the question of restraint always emerges. The lawsuit makes for lip-smacking reading, with its allegations of high-rolling baksheesh to university librarians (when OCLC visited us two weeks ago, we bought them pizza… clearly I missed the baksheesh memo) and other insinuations of a nonprofit scooping up revenue from poor little librarians and tossing it at its own ongoing bacchanal. I doubt OCLC’s response will be “back atcha,” since III is a for-profit, private company. I’ll let OCLC explain its way out of the allegations, but at least there are standards for nonprofits, and as members, we can ask reasonable questions.

Setting aside the question of III’s own corporate purity, my final question is this. How did SkyRiver set its pricing? It bills itself as a cataloging service, so I wouldn’t expect it to follow OCLC’s example in investing in research and development for 21st-century library technologies that hold out the promise of liberating us from arcane, expensive, time-consuming practices. But still… how is SkyRiver’s pricing based?  Was it designed to be too affordable to resist? For that matter, why did III even get into the cataloging business in the first place? Out of the kindness of its heart?

It’s funny, but after reading the complaint end to end, it had the opposite reaction it intended. I felt defensive of OCLC, and proud of what it has done to date. Like family, OCLC can be infinitely annoying, and yet yield surprising satisfaction. When I engage with OCLC–contributing records, sharing resources, even designing resource-sharing services–I feel part of something bigger than I am, something that can be complex and daunting but also highly rewarding.

I don’t want the services I provide to be reduced to a simple equation of what’s cheapest at the moment. That’s the WalMart mentality. I need to be a good steward of our fiscal resources, but sometimes that requires we spend a little more (like buying iMacs instead of low-end junk) to get what we want (reliable quality service to our users). I certainly would be chary of a for-profit service challenging a not-for-profit service strictly over the issue of price, and I hope you would be as well. I know what WalMart has done to small-town America, and I would hate to see that done to LibraryLand.

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  1. ranti wrote:

    It’s purely business, the way I take it. Market share.

    Anyway, looks like your questions can be answered if you contact SkyRiver folks and/or the institutions who adopted it. ;-)


    Friday, July 30, 2010 at 7:37 am | Permalink
  2. Ranti, I wouldn’t take SkyRiver’s words at face value. Speaking of which, I guess this now answers the question of who (or should I say what) has been behind the whisper campaign about OCLC’s tax statements.

    Friday, July 30, 2010 at 8:23 am | Permalink
  3. stevenb wrote:

    The situation could perhaps be likened to what happened to the US Steel Industry. A new (foreign) competitor introduces a similar product at a bargain basement price. The obvious goal is to capture all the business by lowballing the competition. Once the new competitor captures the business, the old competitors (this US Steel, Bethlehem Steel, etc) go out of business. Now the new competitor has no competition and can raise the prices to whatever they like. It’s not a perfect analogy, but you get the picture.

    I think you make the obvious point – why did III get into bib record supply business in the first place? I think we know the answer to that one. I think I know why OCLC is getting into the ILS business – and it’s not the same answer to the first question.

    Friday, July 30, 2010 at 9:32 am | Permalink
  4. Dale A wrote:

    Your distrust of SkyRiver’s motives strikes me as reasonable, but I am less charitable towards OCLC, as are many others. From my point of view, there is a palpable and sizable groundswell of negative OCLC-vibe in libraryland, evidenced by some of the Twitter traffic on this topic and by a lot of backchannel chatter on this and other topics in recent years. They do do many things for the benefit of the community, such as the xISBN server which makes one of the better functions of LibX really sing. On the other hand, though, they do exercise a virtual monopoly and are moving to become a major player not just in the anglo-american world, but globally. Whether we like SkyRiver/III and trust its motives is immaterial in the end, and I am curious to see if the courts rule that there is unfair business practice occurring.

    Friday, July 30, 2010 at 9:44 am | Permalink
  5. Stevenb: Why do you think OCLC is getting into the ILS business? You seem to imply it is obvious but I’m not sure it is.

    Karen: I’ve seen people questioning OCLC’s tax statements for a long time before SkyRiver, so I’m not sure I’d agree that this lawsuit should lead towards any conclusions in that area.

    Friday, July 30, 2010 at 10:06 am | Permalink
  6. Colleen wrote:

    @kgs – VERY nicely written, and oh-so-true. Yes, we might grumble about OCLC and its issues, but at least they ask us to partner in their development, have a decent development cycle, and are actually innovating. The file, as I read it, clearly states multiple times that WorldCat itself keeps III & other companies from innovating – erm. We have been begging them to innovate and been giving them recommendations since time immemorial and they’ve done nothing to help themselves. Sounds like a lot of post-hoc whinging for not thinking of interoperable systems first.

    Friday, July 30, 2010 at 10:40 am | Permalink
  7. Much as I love me some Twitter, I wouldn’t go by that channel as the decisive be-all on attitudes toward OCLC. The Twittering Classes are their own phenom.

    I am aware of OCLC’s missteps… but libraries are feudal enough; we should be on common ground. The real key is to change OCLC’s governance. We have the power to do that, if we believe it’s important.

    Friday, July 30, 2010 at 10:51 am | Permalink
  8. Ed, OCLC is definitely getting into the ILS business; see their recent conversations about WMS. I think for smaller libraries WMS will be a very viable alternative to the silo-ILS sooner than later.

    Friday, July 30, 2010 at 10:53 am | Permalink
  9. @KGS: Maybe I wasn’t clear, I wasn’t asking Steve if OCLC is getting in the ILS business, but what he thinks their reasons for doing so were.

    Friday, July 30, 2010 at 12:30 pm | Permalink
  10. I don’t trust SkyRiver/III one bit, and I don’t wish OCLC to die.

    But I DO think we all benefit (we OCLC members too) if OCLC has some competition. OCLC didn’t _used_ to be a monopoly, that’s only a decade or two old — and how has cooperative cataloging and metadata management done in the past decade or two? Not that it would have done better without a monopoly, there are lots of factors involved, but I don’t think the monopoly is helping us.

    And I am highly annoyed (to put it lightly) at OCLC’s anti-competetive practices. If those practices are actually illegal or not, well the judge will decide. I am not at all unhappy to have OCLC’s bluff called here.

    Friday, July 30, 2010 at 2:57 pm | Permalink
  11. povertystricken wrote:

    Hi y’all. I am writing from WalMart Libraryland. And I am just saying that there are some hard choices to be made here. Sure I’d love to shop at the Apple store. I’d love to shop at Barney’s or Neiman Marcus, but then I wouldn’t have any shoes, or a coat for winter. I would really, really like to continue my OCLC Connexion subscription, in fact I hyperventilate at the thought of it ending within the month, but then the county system I work for would have to close some library branches in towns that don’t even have WalMart, or have no new books on the shelves. I hate being put in the position of choosing between OCLC and any library service at all to a rural community of 90,000 people. But there ya go. OCLC is not cooperating with us. They have effectively priced themselves out of the reach of many cooperating small and/or rural public libraries, most of whose constituents have a WalMart mentality. Am I supposed to say “let them eat cake”? The issue is so much more vast than whether one goes for quality or cheap service. In this case it is coming down to whether there is any library service at all. Our society is not supporting libraries.

    Sunday, August 1, 2010 at 2:19 pm | Permalink
  12. Jonathan, good words there. I think OCLC needs to learn how to be a benevolent, member-oriented nonprofit. The last decade has put them in a position they aren’t ready for, and it shows.

    Monday, August 2, 2010 at 12:35 am | Permalink
  13. Is it that OCLC costs went up, or that library budget issues have made OCLC unaffordable? There is a difference.

    Monday, August 2, 2010 at 12:37 am | Permalink
  14. showme1946 wrote:

    The hostility I perceive in much of the commentary and comments about this lawsuit towards for-profit companies in general and III in particular in disturbing. The achievement of Jerry Kline and his team in the ILS market is singular: they began developing an ILS in 1978 and have sustained that system and its customers with continuous enhancement and evolutionary improvement ever since.

    Tell me, if you had spent your career building such a business only to see it threatened the by the unwelcome intrusion into the market of a behemoth such as OCLC, a behemoth with the overwhelming leverage of Worldcat, what would you do?

    The key information in the complaint is the allegation (which I think we all know is a fact) that III has lost ILS contracts because of OCLC’s intrusion into the ILS market. This is a matter of survival, and this is a battle OCLC has been inviting for years.

    Monday, August 2, 2010 at 3:38 pm | Permalink
  15. There we go, an anonymous commenter talking about other people’s “hostility.” Many of us have good relations with our many vendors… vendors who are not suing OCLC.

    showme1946’s comment also implies that others do not have the right to innovate or get into “the market.” I completely don’t get that. III got into the market as an innovator and competitor. Isn’t that the nature of invention?

    Monday, August 2, 2010 at 5:52 pm | Permalink
  16. I think you make the obvious point – why did III get into bib record supply business in the first place? You discussed a good point

    Tuesday, August 3, 2010 at 7:56 am | Permalink
  17. showme1946 wrote:

    Please. If I were hoping for anonymity, I would need to use a different moniker than showme1946. I was just making the point that I believe III has a legitimate complaint. Whether they will be able to succeed with this lawsuit is entirely another matter. This isn’t good for anyone, but, in my opinion, OCLC started it.

    Wednesday, August 4, 2010 at 10:54 am | Permalink
  18. SkyRiverSkeptic wrote:

    I view this suit with deep suspicion. OCLC does many silly things, and some downright stupid things, but they also provide many benefits to the community. I can’t offer an opinion on whether they constitute a monopoly; that’s a legal issue and I’m no lawyer. But while I understand the glee some might feel in seeing OCLC get a black eye (or worse), those willing to hold SkyRiver’s coat in this little fight should think carefully about what exactly it is they might get in return if OCLC ends up losing.

    Jerry Kline, III owner and SkyRiver puppetmaster, is no knight in shining armor, coming to libraries’ rescue by slaying the behemoth OCLC. He’s a shrewd business man with a chip on his shoulder. He’s mad as hell that OCLC is entering the ILS business. Going after their cataloging service, still the utility’s cash cow, seems fitting revenge. But this may not be all to the good.

    I had the chance to see Kline discuss SkyRiver last fall. I wasn’t impressed. He bristled at questions about where the records came from (in some cases, they harvest them via Z39.50 from libraries, sometimes without those libraries’ knowledge or permission). He repeatedly fell back on the argument that OCLC hides behind tax laws to keep its non-profit status and that his actions were all perfectly legal. Both claims may be true. but they strike me as slightly underhanded, and in any case don’t really constitute a basis for moving bibliographic services from the relatively open OCLC world to a closed, for-profit model of the type represented by SkyRiver.

    Those familiar with III know that its business model is: charge early and often. Believe me, any enhancements to SkyRiver’s functionality will come at a significant cost. Institutions that believe they can achieve big savings with SkyRiver are going to be disappointed in a few years’ time, when Kline starts upping the ante to build new features. When asked what the pricing model for the service was, he said that he cuts 20% off an institution’s OCLC cataloging charges. In my mind, a pretty poor answer: I may not like my OCLC fees, but they at least have some tie to my shop’s use of their services. With SkyRiver, all bets are off.

    I am glad to see someone challenge OCLC’s hegemony. Competition is healthy and we should all benefit from it. I just wish it were someone other than Jerry Kline providing the competition.

    Thursday, August 5, 2010 at 8:54 am | Permalink
  19. “When asked what the pricing model for the service was, he said that he cuts 20% off an institution’s OCLC cataloging charges. In my mind, a pretty poor answer: I may not like my OCLC fees, but they at least have some tie to my shop’s use of their services. With SkyRiver, all bets are off.”

    I agree. I also think it’s cheesy to keep hammering OCLC on its financials if you aren’t willing to open your own books. It’s taking advantage of OCLC’s nonprofit status.

    Thursday, August 5, 2010 at 5:09 pm | Permalink

3 Trackbacks/Pingbacks

  1. Zeds Library News « the zeds : library science on Sunday, August 1, 2010 at 9:04 am

    [...] suit against OCLC.  Monopoly? Non-for-profit consortium?  A Systems Godzilla?  You Decide.  (K.G. Schneider offers a good POV, noting that OCLC may be a behemoth, but at least “OCLC is our behemoth – yours and mine . [...]

  2. The Evil Empire? « WadingIn on Sunday, August 29, 2010 at 8:56 am

    [...] and other library’s operations. Karen Schneider has posted two thoughtful commentaries (1, 2) on the suit, and I think she gets it [...]

  3. [...] It’s not news to FRL readers that I personally feel about Sky River the way I do about buying CAFO chicken thighs, which is that I could save some money but in the end it’s not worth it. (I in fact talked myself into buying non-righteous chicken thighs last week at CostCo, and now I feel so bad about my momentary lapse I’m going to donate a little extra to the Humane Society, which has done a lot of good work educating people on the issue of humane treatment of the food we eat.) But regardless, that whole business was tacky, and it’s good for III to get beyond that era. [...]

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