Cengage: Time to Disengage?
March 25, 2013
Thomson Reuters in “Cengage Learning Hires Restructuring Advisers” reported that a former Thomson property is arranging a modest infusion of cash. “Modest” in this context is about $430 million, which is nothing when compared to the cost of a modern text book. (“See Textbook Prices Are Inflating Even Faster Than Tuition Prices: New Boston University Classifieds for Students Makes Buying Textbooks More Affordable.”)
Cengage used to be Thomson Learning, a sprawling collection of publishing companies. Some of the firms had traditional textbooks; others had combinations of traditional textbooks and electronic versions. My recollection is that the technical infrastructure of the original Thomson Learning was quite diverse. “Diverse” publishing infrastructures in the same organization add significantly to the costs of doing business. “Diverse” is also a stuck brake on innovation because repurposing content is time consuming and labor intensive. Prior to spinning off Thomson Learning to Apax Partners and Omers Capital Partners, Thomson’s senior management were focusing their considerable talents on cost efficiencies. . I assume that the technical infrastructure issues have been resolved.
Debt can be a burden as this illustration from Shape Home Loans suggests?i Does debt enhance agility or is it a financial play disconnected from structural changes such as those described in my “Gadzooks, It’s MOOCs: The Fuss over Open Source Learning” article?
One item in the Thomson Reuters news release caught my attention:
…the company said it had borrowed $430 million, almost all of its remaining credit facility to ensure its businesses have the cash they need. Stamford, Connecticut-based Cengage has a $1.5 billion term loan that matures next year and a total of $5.3 billion of debt as of Dec. 31.
Several observations:
First, this type of cash crunch in publishing is likely to become more common. I wrote a story for Online Searcher about the impact of online learning. There is also a chorus of “if you are smart, you can skip college” echoing around Kentucky. What if the online learning and the “you don’t have to go to college” blend? Companies depending upon the traditional purchasing patterns in education may find that new revenues are not sufficient to keep up with old revenue losses.
Second, the spillover from a Cengage-type of problem will have cascading effects. Examples which come to mind are revenues flowing to such organizations like Ebsco Electronic Publishing, ProQuest, and Wolters Kluwer. These companies are in the education food chain. If Cengage flu becomes contagious, these firms will face some additional financial challenges.
Third, the authors who provide content to the textbook giants have to be paid. With the shift to online courses, some of these authors may take their “fame” and their content and go a new direction. It is now possible for some textbook superstar authors to try to become celebrities. If Google needs knowledge, the company just hires the superstar. Won’t the same approach become possible in the online learning space? Maybe an existing textbook company will corner this market? I am not sure traditional textbook companies have the agility necessary to pull off a slam dunk.
Fourth, the online services like Thomson Reuters’ WestLaw and Reed Elsevier’s LexisNexis may also feel the impact of a shift. On one hand, these systems could gain new content from disaffected textbook publishers and, therefore, more revenue pulling information. On the other hand, traditional online services have been caught flatfooted by the surge in online educational content and may be too late to ride the new revenue train.
Net net: Is it time for customers of Cengage to disengage? A larger question is, “Will the professional publishing and professional online services be able to adjust to yet another sapping of their life blood?” Changes are coming. Many of these shifts will not be gentle, kind, or slow I fear.
Stephen E Arnold, March 25,2013
Search Technology at Funnelback Morphs Into Compliance Auditor
March 24, 2013
According to the new post on Funnelback’s Web page, the search engine technology and services system is morphing into a compliance auditor. The article, “Funnelback WCAG Compliance Auditor Version 2 Is Out Now,” shares that the newest release of the auditor technology includes the ability to configure checking runs, on-demand checking of HTML, and comprehensive reporting abilities.
The article comments on the additional features:
“Matthew Sheppard, Manager of Research and Development at Funnelback said, ‘Customers have been making amazing progress on their website accessibility with version 1.5, but we wanted version 2 of the tool to make the process easier than ever. WCAG Compliance Auditor version 2 is flexible, highly configurable and accommodates the last minute changes that web content editors often face whilst maintaining their website’s content accessibility at the same time.’”
I think the new capabilities are intriguing, but there is no information available on the Web page on which countries the auditor works for. However, the global company has a demo available at http://www.funnelback.com/our-products/demo. Definitely worth a look.
One question: “How can a single consulting firm know so much about so many search and retrieval systems?” Hyperbole, exceptional intelligence, or marketing?
Andrea Hayden, March 24, 2013
Sponsored by ArnoldIT.com, developer of Beyond Search
SLI Systems Brightens Online Shopping
March 21, 2013
Online shopping is designed to be a pleasant experience for shoppers and LEDHut wants to make sure that its customers get the most from their online shopping experience. According to the Econsultancy Digital Marketing Excellence article “LEDHut Brightens the Online Shopping Experience with Site Search from SLI Systems” LEDHut is switching to SLI’s Learning Search. They were previously using the open-source Magento e-commerce platform.
LEDHut wanted a site search that not only improved relevancy but also helped visitors learn more about LED technology and the lighting products that are readily available. More importantly Learning Search gives LEDHut the ability to provide more relevant and tailored results to their shoppers. Not only does the solution take into account misspellings but they also offer product suggestions and the users has done a few keystrokes. LEDHut is looking forward to adding a SLI powered mobile site. Keith Scott, Marketing Director of LEDHut made the following statement:
“The LED lighting industry is still in its infancy in the UK and Europe, which means our customers need to be presented with relevant items that match their searches. Now, instead of being overwhelmed by too many results, SLI’s Learning Search delivers precise results that are easier and faster for shoppers to browse through – which also helps them increase their knowledge of LED options to fit their home and lifestyle.”
Shaun Ryan CEO of SLI systems stated a very important fact.
“Fine-tuned, relevant results that are generated from the past behaviour of other visitors encouraging shoppers to browse and glean information about product choices – which in turn increases conversions.”
Online shopping should be a user-friendly and customer oriented experience so LEDHut definitely with the help of SLI Learning Search definitely has the right idea in mind.
April Holmes, March 21, 2012
Sponsored by ArnoldIT.com, developer of Augmentext
Google Is Not Evil
February 11, 2013
It is so easy to put a black cape, top hat, and dastardly mustache on Google, because nobody gets that successful without a few skeletons in their closet, right? Also the company has a “Don’t Be Evil” motto that gives them more flak than the average company. They must be evil, right? Or maybe it is the simple, natural process called change. Blind Five Year Old outlines“Google’s Evil Plan Is Simple (And Not So Evil)” by explaining the search engine is not evil, the users are. The article even details what Google’s “nefarious plan” is:
“Get people to use the Internet more. That’s it. The more time people spend on the Internet the more time they’ll engage in revenue generating activities such as viewing and clicking display ads and performing searches.
The way Google executes on this strategy is to improve speed and accessibility to the Internet. Google wants to shorten the distance between any activity and the Internet. Lets look at some of Google’s initiatives with this in mind.”
The article outlines a bevy of Google products and services meant to increase Internet accessibility and usage. More Internet usage means Google gets used more and Google makes more revenue. At the same time, Google is saying that this will improve people’s lives. Google is trying to find the best ways to make its products and services available everywhere at anytime. It sounds more like economics than world domination theory.
Whitney Grace, February 11, 2013
Sponsored by ArnoldIT.com, developer of Beyond Search
Commercial Professional Publishers: Aced Again?
February 8, 2013
In June 2012, an insular commercial database and professional publishing operation paid me to show up and share the trends my team had identified in online information. We were deep in the open source search study, which will be available to registered attendees of the Lucene Revolution in May 2013. I showed up, ran down a list of five areas which looked like potential investment areas. The group said, “We have these on our list already. What the heck did we hire you for anyway?”
Flash forward eight months. The insular outfit is still insular. And one of the opportunities I highlighted just became much more expensive. Navigate to “LinkedIn Eyes Future as Professional Publishing Hub.” The story points out that LinkedIn is profitable and growing organically. Here’s the passage I noted:
LinkedIn plans to hook you with business content you can’t get elsewhere — whitepapers, news articles, educated discussion threads, and so forth. When you come back more often and stick around longer — LinkedIn likes to use the term “engagement” to describe your attention — the professional social network can get clients to list more jobs and spend more on ads.
Oh, oh. Content marketing. I think the approach is a variation on Augmentext type content.
Most professional publishing and database companies do not grow organically because after years of trying to move into new markets and channels, the outfits just raise fees to lawyers, accountants, librarians, and financial analysts. When that stops working, the companies buy stuff and try to make the investments work. Whether it is medical fraud or crazy online encyclopedias, the path to the good old days of commercial professional and database publishing are harder and harder to recapture.
LinkedIn, like a couple of other outfits, is now heading into professional publishing land. If one of the big guys like Thomson Reuters or Ebsco try to hop on the train, the price of ticket has gone up a lot.
I don’t like to say, “I told you so.” I am more inclined to point to Williams James’ comment about “a certain blindness.” If you don’t see it, you cannot react. This is not Google or Facebook “arrogance” on the part of these traditional publishing companies’ management. The inability to spot an hot opportunity, overcome the friction of the “way it was,” and then act in a purposeful manner is the core problem in this business sector. Mark Logic can run conferences that cheerlead slice and dice as a strategy for growth. Outsell-type consultants can spin reports about innovations in publishing. The failed Web masters and unemployed journalists who bill themselves as mavens and poobahs can explain what’s happening in content created by and for professionals.
The problem is that making money means getting in before the CNet’s of the world report the obvious. So, no I told you so. Just a certain blindness. One can get run over crossing the street when blind. Stakeholders, are you listening? Some of the management in the companies in which you have invested may not be able to see the opportunities on the information superhighway.
Stephen E Arnold
Is Facebook a Rip Off of 16th Century Academics
January 28, 2013
To us, it seems Facebook has taken over the Internet. The giant social network that promotes sharing data and creating a web of relationships is a real innovation, rising above the crowd online and off. Or is it a ripoff of a 16th century monk? After reading “Facebook Concept Used by 16th Century Scholars, Researchers Discover” on Phys.org, we are not so sure.
The article states that our obsession with social networking is nothing new. Researchers say this idea of creating groups or networks and then exchanging information dates back to the 16th century where young scholars created nicknames and developed mottos and emblems to form groups where information was shared. We learn:
“Professor Jane Everson, Principal-investigator, said: ‘Just as we create user names for our profiles on Facebook and Twitter and create circles of friends on Google plus, these scholars created nicknames, shared – and commented on – topical ideas, the news of the day, and exchanged poems, plays and music.
‘It may have taken a little longer for this to be shared without the internet, but through the creation of yearbooks and volumes of letters and speeches, they shared the information of the day.’”
The discovery was made when a team of academics were cataloging the works of the Italian Academies. Too bad for the monks, this copycat system is alive and thriving with no thanks to these early scholars. We think the similarities between our societies is fascinating and salute these early monks for the innovation.
Andrea Hayden, January 28, 2013
Sponsored by ArnoldIT.com, developer of Beyond Search
Key Yahoo Traffic in Steady Decline
January 23, 2013
Yahoo’s CEO Marissa Mayer has a big hill to climb. Just as she is working to woo investors, recent statistics present some troublesome numbers, we learn from “Mayer’s 10X Challenge: Yahoo’s Homepage, Mail, and Search Traffic Show Significant Year-Over-Year Declines” at All Things D. Yes, that search thing is one of the issues; email and the customizable homepage are the other primary problem spots. The article informs us:
“Private stats from comScore show that those three areas have continued their longtime decline over the last year, in some cases dropping significantly. In November and December, for example, compared to the same two months a year ago, U.S. search was down 28 percent and 24 percent respectively, while mail was down 16 percent and 12 percent.
“This matters a great deal, since the troika of homepage, mail, and search have been the critical driver of the Yahoo value ecosystem for advertisers.
“The impact of those drops is felt all over Yahoo, whose music, movie, games and travel site have also seen massive drop-offs in traffic year over year in those same months.”
Though the drops in search and email were steep, the home page seemed to stabilize a bit, and Flickr has increased its users by a handsome 37 percent. That could have something to do increased support the CEO has been showing for that project.
Flickr, however, is not enough to save Yahoo, insists Swisher. She does give the company credit for other moves it has been making to refresh its offerings, like a new version of Yahoo Mail and a homepage redesign that emphasizes its mobile and social facets. Will it be enough to keep Yahoo near the top of the heap?
Cynthia Murrell, January 23, 2013
Sponsored by ArnoldIT.com, developer of Augmentext
Paid Links May Be the New Content Manipulation Game
January 8, 2013
With the New Year upon us, we can count on new tricks for content manipulation. Search Engine Land brings to our attention of the of the possible new tricks in “Will 2013 Bring a Paid Link Resurgence?” Not many people give credit to link builders, but the conjecture is that bad links for Web sites could potentially be as bad as negative SEO. Google has once more updated its Webmaster Guidelines and paid linkage is a way to manipulate Google’s search results. Google is punishing web sites for unnatural links. Webmasters will have to finally admit that content is the only way to get to the top of Google’s search results or control their marketing process. The later usually involves greenbacks that most do not want to spend. If business starts to suffer, however, guess where investments will need to be made?
Google is working overtime to control its search results:
“Google’s constant attempts to crack down serve only to spawn new and harder-to-catch ways to win. It sounds harsh but I know that no matter what methods they develop of controlling manipulation in one form, people will find ways to manipulate something else, until that gets smacked too, and they start over again.”
Paid links are part of everyday Web search and their impact is felt, we just do not realize it. However, one method of search results manipulation does not prove better than the other. It all depends on what is popular at the time and what can get past Google’s aggregators.
Whitney Grace, January 08, 2013
Sponsored by ArnoldIT.com, developer of Augmentext
Amazon Needs Content to Redeem Kindle Sales
October 24, 2012
Our beloved chief goose has commented about Amazon’s battle with its rising costs. Selling hardware at a loss in the hopes that the business model of Richard King Gillette will work is the sign of an optimist.
According to a recent admission from Amazon CEO Jeff Bezos, Amazon needs content, and it needs it to sell fast. The company stated that it makes virtually no money on its Kindle hardware and is counting on content to sell to make the ebook venture worthwhile. The reporting article, “No More Games: Amazon Admits it Needs Content Sales for Kindles to Fly” on Ars Technica, shares that the company is hoping that content purchases from Kindle users will redeem the profit margin on the ereader.
The article reveals more information about the pricing and the company’s game plan:
“The Kindle line has long seemed like it might be a loss leader for Amazon, though the company has been reticent about stating that outright. Bezos said at the press event announcing the new Kindle Fires and the Kindle Paperwhite that ‘We want to make money when our customers use our devices, not when they buy our devices,’ before unveiling their competitive (but not staggeringly low) prices.”
The revelation sounds particularly dreary for Amazon and its content providers. We wonder if the company will be able to control its costs at this time of tactical loss leaders in tablets and ebook readers? What happens if the costs exceed revenues? Interesting question.
Stephen E Arnold, October 24, 2012
Sponsored by ArnoldIT.com
Study Proves Students Not Enthused About Digital Classrooms
October 17, 2012
Numerous opportunities exist online to assist in the development of education, such as social networking, blogs, and even simple email. However, according to an article I spotted on Phys.org titled “Study Reveals Disparity Between Students’ and Professors’ Perceptions of the Digital Classroom,” the integration of education and information and communication tools (ICTs) is not exactly welcome by many students. A recent study from Concordia University shows that students actually prefer an engaging lecture to some wired supplement.
The article elaborates on the results:
“Instructors were more fluent with the use of emails than with social media, while the opposite was true for students.
‘Our analysis showed that teachers think that their students feel more positive about their classroom learning experience if there are more interactive, discussion-oriented activities. In reality, engaging and stimulating lectures, regardless of how technologies are used, are what really predict students’ appreciation of a given university course,” explains [Magda Fusaro from UQAM’s Department of Management and Technology.]”
The countless possibilities that exist online to expand learning and teaching methods could prove to be a mad rush to the Web for many learning establishments as they attempt to explore the options. However, if this study is accurate, students may not be willing to go along on the ride. It appears online information and services may not be able to fill student expectations.
Andrea Hayden, October 17, 2012
Sponsored by ArnoldIT.com, developer of Augmentext
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