Library software market faces more turmoil

I've just been putting together next month's sector update for IWR on the library automation and information management market. This is printed to coincide with the Library + information show at the Birmingham NEC next month.

This will be my last sector update for IWR, as I move on to pastures new at the end of the month, but it seems like quite an appropriate place to write a final market round-up.

The library software sector has been traumatised by the impact of the internet, and continuing to make itself relevant to customers has meant only the strong – the companies that could afford to invest heavily in R&D for long-term benefit – have been able to survive.

No wonder then that Reed Elsevier sold Endeavour to Ex Libris last year, or that OCLC Pica snapped up Fretwell-Downing, or Sirsi and Dynix merged into SirsiDynix.

Paul Miller, technology evangelist at Talis, says its still early days to see how customers respond to all this vendor turmoil. "It will be intriguing to see how much further this goes in 2007," he told me. "It remains to be seen exactly how customers will respond to forced migrations from one product to another, and to the consequent reduction in market choice."

Robin Murray, Director of Strategy and Marketing at OCLC Pica, thinks the big changes on the supplier side will continue for some time and have some profound effects on the market.

"If you look at the companies out there you see a lot of first-and second-generation organisations - either owner-managed or with initial venture capital backing. In the IT industry economies of scale are very significant so everyone is looking for growth, but there isn't much organic growth in this market. So the current market conditions and ownership structures are driving a spate of acquisitions and mergers."

With both Microsoft and Google engaged in book digitisation projects on an industrial scale, libraries will need to reinvent themselves quickly for the 21st century – and I think that global-facing libraries with unique, specialist collections who create internet infrastructure that caters to the specialist needs of their users will be the ones that win the day.

Several vendors seem to be going down that route, developing the platforms that will enable this.