During 2002, HEDS Digitisation Services was invited to carry out a research study on behalf of the Andrew W. Mellon Foundation to examine the new market realities and opportunities cultural institutions face in the transition to digitised collections. The project explored the cost and policy models adopted in arriving at pricing structures for delivering surrogates of unique or rare items as digital objects.
The study focused on libraries, archives, museums and galleries. Cultural heritage institutions in the UK were investigated, with some other European institutions included in total, 51 institutions were surveyed and 15 were interviewed. As far as the authors are aware, this is the only study to explore and report upon the pricing practice and policy for the transition to digital for a wide range of cultural and heritage organisations.
Cultural institutions that hold valuable and unique/rare artefacts have been creating surrogate representations of these artefacts for centuries. Since the development of photo-reproduction methods, these institutions have made available a whole range of secondary images for various purposes including: scholarship, teaching, public enjoyment, publication, etc. Most large libraries, museums and galleries promote reproductions of their own images as mass consumer goods such as postcards or posters. Many institutions also offer on-demand services to create and supply very high quality photographs for scholarship and publication. With the development of top-of-the-range digital cameras and scanners, digital reproductions that rival in quality even the best of photographic images can now be supplied. Many cultural and heritage institutions are now, therefore, turning to digital capture for some or all of their services. Throughout this article, the photographic reproductions are referred to as 'analog' and are compared with the newer 'digital' formats. The study dealt only with cultural and heritage artefacts with significant image content; so contemporary text-based formats (such as printed books and journals) were excluded from the focus of the work.
The study concluded:
Cost Study Findings
The results of the cost study are indicative of the maturity of the market for the sale of analog and digital items in the heritage sector. They also show the state of the technical provision and integration of the business process with wider institutional goals. Detailed information about payment options and cost comparisons are as follows:
Payment options explored
Digital is approximately 10% cheaper than the comparable analog item, based on the price offered the consumer. The range of the prices for digital and analog are shown in Figure 1. (The numbers on the Y axis of the graphs below refer to the responses received.)
Figure 2 shows the range of price differentials between analog and digital. In 82.5% of cases digital is either the same price or cheaper for the consumer than the analog equivalent.
It is worth noting that 15 of the 40 responses show a 0% difference in price. Therefore in 37.5% of comparable cases, the consumer was offered a choice of delivery medium without having to consider any economic factors for that choice.
Conclusions and Implications
The Business Case
Many respondents felt they were being pushed into making massive changes without proper consideration regarding the systems needed to support such changes. Very few institutions seemed to fully appreciate the overall institutional strategies for the move to digital; less than 30% of the institutions appeared to have done detailed planning or had implemented the significant organisational change required for the move to digital delivery and access. Although results of the study indicate a higher degree of maturity of business practice in national libraries, museums and galleries than in public or university libraries, there appeared to be a marked lack of clear commercially led business planning and control in most institutions surveyed. This is not to suggest they are badly managed, but rather that the financial exploitation of the medium is not the foremost institutional priority.
The statistical results of the survey indicate a definite pricing trend that suggests digital items will continue to become cheaper for the consumer to purchase than the analog equivalent. There are several reasons suggested by the study for this:
The Web Case
The fact that 72.5% of the surveyed institutions had a website offering cultural heritage artefacts for sale in some manner and that 25.5% are showing thumbnail views to aid consumer selection is an indication of the growing confidence in the Internet and digital means of delivering services. These services seem bound to expand and to mature, with better information for the consumer available online to aid their purchase decisions and possibly more e-commerce to speed the sale of items. Indeed, the provision of images on the Web does not seem to reduce the potential income of the institutions interviewed, but has been beneficial to the sale of usage rights and in promoting the cultural collections of the institution.
The cost study results clearly suggest that digital provides a better platform to promote the collection to a wider national and international audience than analog. Most institutions interviewed planned to increase the number of thumbnail or screen-sized images available at no cost to the user. The formation of co-operative strategies between institutions was also promoted as a way forward. All institutions were concerned about retaining the rights to their high quality, high-resolution images as well as asserting their rights in any items they make available on the Internet. Amongst the clearest conclusions it is possible to draw from this study is that for a service unit to operate at a surplus, it has to account for the sale of rights as part of its operation. Very few of the institutions interviewed made more money from the sale of the medium, whether analog or digital, than it cost them in creation, management or service provision. The only apparently profitable part of the transaction was the sale of the right to use the material in a commercial publication. All institutions sold rights, but only a few allowed the revenue from those sales to be directly linked to the actual service provision of creating, managing and delivering the media to the consumer. This suggests that, at least in financial terms, the message is more valuable than the medium.
The full report of this study is available at <http://heds.herts.ac.uk/mellon/charging_models.html>.
The Andrew W. Mellon Foundation (http://www.mellon.org> has provided an additional grant to HEDS for a continuation of the above study to consider how USA art museum policy and practice addresses the digital resource market.
The details of this continuation study may be found at <http://heds.herts.ac.uk/mellon/US_art_charging.html>.
(Corrected coding for one of the navigational links at the bottom of the page 8/31/05.)
Copyright © Simon Tanner and Marilyn Deegan