Eugene, Oregon
May 13-15, 1998

The Future Network: Transforming Learning and Scholarship

Appendix I

ARL Business Meeting

President’s Report

MR. NEAL (Johns Hopkins University): I’d like to open up the business meeting and remind everyone that it is for member representatives only. As ARL president, I can report to you that the Association is in excellent health, fiscally sound, strategically active, and effectively networking in key communities.

I’m going to provide a brief report just to highlight some of the items that are being discussed within the Board. First, I want to remind everyone that we will be awarding the ARL Distinguished Service Award to K. Wayne Smith, the retiring CEO at OCLC, at the OCLC lunch during the ALA convention. If you are able to attend, it would be great to have a strong ARL presence at that meeting.

Secondly, the Board has reviewed the report from the George Washington University Membership Review Committee and will be bringing forward to the membership a recommendation for consideration at our fall meeting. The Board also spent significant time on the future, nature, and role of the ARL Membership Criteria Index within the Association—both its relationship to perceived measurements of quality and its relationship to membership.

We’re hoping we can wrap our arms around this issue in substantive ways this year, and we’re looking for ways to do that. There are members of the Association, however, who continue to tell us that this is a very important tool on the campus and local levels and that we need to approach it gingerly and not just simply toss it.

We are also looking at approaches to new member recruitment: One, whether this is something we’re interested in as an association; and two, what types of institutions we should be considering.

We had an excellent opportunity yesterday to get an update on copyright legislative developments. Those of you who saw the paper this morning will know that the WIPO Bill, as I understand it, was passed in the Senate 99 to 0. That means we are going to have to work very hard on the House. The database bill continues to be a very difficult area. Prue Adler is asking for letters to your House representatives. As you send letters to those individuals, please make sure that copies are given to Prue. They have an impact both from your sending them and by Prue being able to share and discuss them with the staff.

The Board is also looking at strategies for engaging federal funding agencies, those organizations that provide significant research grant dollars to our faculty researchers on our campuses. We are looking at these agencies in terms of what interest they might have and what guidelines they might have in place regarding the public domain status or the publicly accessible status of the products from those research grants. This is something we have kicked around for a long time as a community, and I think it’s time to roll our sleeves up and really get some solid conversation going on.

Finally, as you well know, we have filed a brief in support of the recent decision in the Gordon and Breach case, and we worked with ALA and SLA in funding that strategy.

Those are the few items I wanted to report. The Board has been very focused on the results of the 1997 fiscal year and the first quarter 1998 data, which Duane will highlight in his executive director report.

We are looking very aggressively at the Pew Roundtable follow-up strategies and had some good discussion of that here this morning, and obviously SPARC and the purchasing and negotiating concept have been very much a part of the Board’s agenda. So let’s move to those several items. We want to spend as much time as possible here at the meeting debating, reflecting on, and really building momentum behind the SPARC initiative. I’m going to ask Ken to come to the podium and lead our discussion.

Report of the SPARC Working Group

MR. FRAZIER (University of Wisconsin): Thanks, Jim. The idea of the Scholarly Publishing and Academic Resources Coalition (SPARC) began one year ago at the May 1997 ARL Membership Meeting. Though it might be said that many of the values and concerns that SPARC addresses were already present in earlier ARL initiatives and programs, I was grateful to Jim for referencing the presentation by Doug Bennett that ignited a very determined series of discussions both in the meeting and in the corridors last year at this time.

Today SPARC has 76 quality members. Some of the institutional founding members of SPARC include: The University of Alberta, the University of British Columbia, Laval University, McGill University, the University of Manitoba, the University of Saskatchewan, the University of Toronto, the University of Waterloo, and the University of Western Ontario. I tell you this to point out that, although all regions and the largest and smallest ARL members are backers and supporters of the SPARC concept, the Canadians are there in disproportionate numbers. I can’t help but observe they’re there despite the fact that, not for any reasonable measure, they are, of course, paying more. Canadian voices have always been leaders in addressing some of these issues. I don’t pretend to understand all the reasons why we have such a very high level of participation from this community. But it does demonstrate to my satisfaction that this is indeed at its origin an international movement. I therefore want to thank you all very much—not only for participating at this very early stage, but also for your thoughts.

It was never anticipated that there would be 100 percent ARL institutional participation in SPARC, but we have had an extraordinarily high level of participants in reviewing and discussing these ideas. SPARC has gained the valued endorsement of the American Association of University Presses (AAUP) and, as you heard from John Vaughn, an endorsement of the concept from the Association of American Universities (AAU).

Secondly, SPARC is already engaged in discussions and negotiations with potential partners. One public example is the negotiation with Robert Bovenschulte, who heads the publications division of the American Chemical Society. We’ll say a bit more about this later on.

In recent weeks we have moved very aggressively to recruit a SPARC enterprise director. This has provided us with another opportunity to define SPARC’s core objectives. That is to say, to focus on the areas of scholarly communication where competition is most urgently needed, to consider the critical importance of communication throughout all of our initiatives, and to recognize the necessity of teamwork within ARL and with the partnerships connecting us to the wider scholarly communities.

SPARC is also actively engaged in forging international alliances, especially with European organizations and also to some extent with Australian scholarly communication and educational organizations. This is all in a very early stage.

As a last major item, we agreed during the course of this meeting to extend the deadline for founding membership to August 1, 1998. During this time we will settle upon a membership dues amount for next year and during the same time frame we will also see if we can decide upon a strategy for including other institutions as affiliated members.

Looking ahead for the new term, we need to implement a very short-term communication plan. Even looking as close as the ALA conference in June, we need to evaluate near-term partnership opportunities with university presses and perhaps with other groups.

One last example of a near-term mandate is to consider whether we’re going to work with the publishing community and editorial boards and, if so, then we need to actively encourage editors to consider moving their journals from their current publisher to publishing agencies more sympathetic with the academic enterprise.

This has wonderful metaphors for me and brings to mind the underground railroads, the concept of creating safe havens, safe harbors, even sanctuaries for publications that are ready to move. This idea particularly resonates because really it’s the most transgressive of all of the concepts that are under current discussion; it’s most like coloring outside the lines because we know it to be not only possible but extremely provocative.

Well, I will now turn to Margo, who will summarize some of the feedback we have already gotten from you as a launching point for a brief discussion here. We have gained a lot from the discussion so far. But a few things we already know: 1) capable partners are waiting for us to start—the doors are open to us when we explain our goals clearly; 2) we are already benefitting from your input; and 3) there is a strong sense that something is about to happen.

MS. CRIST (University of Massachusetts): We thought it would be useful to just get us underway by sharing what we’ve been hearing already, both from the working group trying to get feedback as well from direct polling.

Some feedback has been regarding caution: Incrementalism won’t do it, don’t make us just another membership organization. People have a number of questions: Is SPARC going to be a publisher? We will talk about that more, but the working group sees SPARC as a catalyst, not as the actual publisher.

Other questions raised are: How can we create competition with just a few products? How will we address the archiving issue as this gets under way? How will this relate to the credentialing process, and how do we engage faculty so this is not just "a library issue"?

Then there is feedback that is more in the line of opportunities that have been identified to us. We heard yesterday we should break the mold, move quickly, be agile, show results early. Again the need to engage the faculty and the provost was identified, and we have some successes to talk about.

Yesterday we heard from you that we should use Internet2 as a option. We want to do this as well. Are we doing communication planning? Yes, we are. You have heard a lot about SPARC in the last couple days, but it would be interesting now if anybody wants to identify any other issues you think should be on the list for our working group to consider.

UNIDENTIFIED: This is in light of Ken Frazier's comment about the international, global aspect of this: Is this an opportunity to engage overseas partners? Certainly it could be if we saw there was a change in how the research and university libraries were looking at this issue.

UNIDENTIFIED: SPARC was fundamentally proposed to be competitive with high priced publishers, and to catalyze other projects with other publishers. An important piece that was explicitly captured in that formulation is introducing other non-conventional means of managing copyrights as a part of being competitive.

MS. CRIST: Are you suggesting that it should be part of a partnership?

UNIDENTIFIED: Yes.

MS. CRIST: Other questions to add to the list?

UNIDENTIFIED: Is SPARC a strategy of replacement or a strategy of influence?

UNIDENTIFIED: Will SPARC be just electronic or will it have a paper component as well?

MS. CRIST: Thank you. All of your questions will be put on the list for the working group to address. At this point, I think we might want to go to some reports from the floor from others in the working group. Paul, do you want to share a little of the flavor of the conversations you had with the American Chemical Society (ACS) and your chemistry faculty?

MR. KOBULNICKY (University of Connecticut): When talking with several of the science faculties on my campus I was struck by the difference in responses that I received, particularly the difference between physics and chemistry faculty. Talking to physics faculty I got an extremely lukewarm response about the SPARC project, and very strong concern about maintaining some of the more egregious publications—largely because of the international component, I might add.

But after I talked to the chemistry faculty I noticed a difference in attitudes. I think this was largely because there was a visible solution at hand, and a solution that had a lot of quality associated with it. The notion there that might be some engagement on the part of the chemistry discipline’s major society—who is also a publisher of a very reputable journal—made the chemistry faculty much more willing to engage with me in collaboration on the possible solutions.

Now, this is not to say that they will be ready to move forward or to be radicalized very quickly. But, in fact, they were willing to be engaged in the discussions. We need to keep that in mind.

A second thing I wanted to mention was my meeting Monday with Bob Bovenschute and the publications division of ACS at a management retreat they were holding with about 40 of Bob’s key managing editors and production managers. What I was struck by was that the same issue of cultural change is going on in that organization and as is going on on our campus over the same issues of scholarly communication and scholarly publishing. You may have a sense that Bob is somewhat unique right now among the leaders of the scholarly publishing field in trying to effect change, and I firmly believe that he is certainly at the very forefront. But I was equally struck by the very, very hard work he was undertaking not only to bring his staff along with the prospectus but to get them to own the same kind of values and therefore inculcate those values into their actions.

It is a very difficult process for all aspects of our cultures, and I think we have to be aware of the fact that we will have a hard time expecting our partners to immediately jump to the same level where many of us are. Certainly the leadership has been able to jump to the point where we, the leaders of the library profession, are. But you have to recognize that they also have to bring their staffs along.

I was struck, for example, by talking to the ACS director of copyright and to listen to that person’s views and recognize over what a long period of time that person’s views and position had been developed. Even given their willingness, think how hard it would be for them to move outside of their own box to begin to think of how things might work.

Again I was struck by the fact that they too need to be able to deal with some very concrete projects, concrete examples, and to work through the details of how such projects would play out. This is no more different than our faculty’s need to be presented with concrete examples of how their world will shift.

MS. CRIST: One of the things we heard about was engaging the provost. Bill, do you want to say more on this? Your provost keeps getting presented as a model. He states you’re now making him famous.

MR. CROWE (University of Kansas): It helps to have a provost who is an economist and who thinks like an economist. I think the thing he’s committed to do is influence the other chief academic officers as well as the state university system in Kansas—like securing support from the Kansas Board of Regents, which governs the universities. The Board has some trigger mechanisms for ways to unbundle copyright that gives faculty some assurance that they are not giving up rights but are rather sharing rights. The documents that we got from North Carolina State University were very helpful in that regard—sharing that kind of information is critical. But the championship aspect is that he has to find some presidents and chancellors to take this on with him because moving it up and getting the faculty will both be critical.

My boss is prepared to be a champion on these issues as one or two of the most important things he has to do in the rest of his career. And he’s young.

MS. CRIST: One of the things we’ve been hearing from some of you who wanted to be able to take something back to use on your campus is that it is necessary to have the material and the message clear, well presented, and ready to go. We have been working on that in the SPARC working group.

So I’ll ask Sarah Michalak to say a bit about that, because we are focusing on what other kinds of materials you think you will need that we might be able to help provide. Sarah.

MS. MICHALAK (University of Utah): It is clear that communication and education are everything with SPARC—in spite of the fact there are very specific core goals. Nothing can be accomplished without a good communication plan. So we’re envisioning a document that is actually a package of several documents.

The first task is to identify the audiences; we’ve done much of that in this meeting. I’ve been taking notes throughout the meeting of the different kinds of audiences people think need to be addressed: Faculty, chief academic officers, presidents, the next 100 university libraries, library consortia, university press directors, and of course, the international audience.

We are also looking to Europe. There are a number of groups that are very interested in SPARC. The Dutch librarians have issued a set of principles that parallel the SPARC principles and others have mentioned they are very interested, as well. We need to look at Europe and we need to look at Asia and see if there are other audiences there, too. So the idea is to continue to identify and keep the specific audiences and define and create messages that will be suitable for each one of those audiences. We need to create a set of time lines in which the next-year SPARC participants might be able to deliver those messages at the appropriate time and place, consider the proper vehicle for each message and for each audience, and then prepare paper and PowerPoint packages that can be distributed to those who wish to speak to SPARC according to the kind of audience that you wish to address. Hopefully we will soon be able to hire a communications professional to help polish the package and to help us get a graphic image for these presentations that will really work for us.

I want to thank Mary Case for the materials that she’s generated. I have relied on the OSC generated SPARC materials for a long time now, and they are so much help in getting the message out in the campus and to the broader community.

MS. CRIST: We are all in Mary’s debt. Are there issues that you’d like to address at this point?

UNIDENTIFIED: I think the key communication has to be something for faculty, who are now asking, "Why should we spend $15,000 a year on that?"

MS. CRIST: We’ve been trying to get the list of target audiences that we feel need to be clear on the priority. Faculty need to be top on the list.

UNIDENTIFIED: Because I think the administrators are already engaged in this.

UNIDENTIFIED: Related to what she just said, the accreditation issues are another good area to target.

MS. CRIST: To address the accreditation issues?

UNIDENTIFIED: Correct. And to talk to the accreditation groups.

MR. BILLINGS (University of Texas): As I think about it, I can’t help but think about what Emily Mobley did at Purdue. She did a remarkable job in getting to her faculty. A couple of comments over the last few minutes has made me think SPARC has come a long way from the original idea to the more fuller fresh initiative that we’re looking at now.

But I can’t help but think that we cannot create a more competitive market place—I’m sorry. We can influence a change in culture. We can start leveraging the directions our institutions need to turn. We can start leveraging the directions, but the information flow itself needs to turn.

We can’t compete with the dollars that the present publishers in the world have to ultimately persuade the faculty and the scholars from our institutions or from whatever other agencies and independent scholarly places exist at the present time.

Going back to Ken’s poetic imagery—he even talked about David and Goliath—is not nearly the kind of battle that we are looking at when you talk about the competition. We have to talk about influencing. We must to get to our faculty. Our faculty has to have some reasons to want to change the direction and the mechanism by which scholarship gets into the information flow that all of us scholarly people need so badly.

What kind of influence can we use on faculty? We talked about the decoupling of the various issues. In some ways, frankly, I think that issue is somewhat of a red herring. We are talking about the rights of publication; we are talking about rights and contracts.

It is interesting to reflect on the library press where we sign agreements to the effect giving the copyright to our work to our own library publishers. How silly can it be when we in our profession can’t even control the mechanisms in the present world. What kind of incentives can we provide our faculty?

At our institution we have a new series of actual monetary awards that we’re able to provide the faculty every year that come from an endowment that has been established for scholarly publication. One of the things I have already suggested is that we look at turning more and more of those awards towards the best original contribution first published in electronic format over the Internet. That is something we can control at our level.

What might lead our faculty to turn their publications and scholarly products towards a different scholarly information flow?

I think we have to look towards some fresh ideas that will help influence rather than directly compete. So I am in a quandary here. I realize you want to promote the kind of energy we have behind SPARC. I think it’s a good start, at least. We have a lot of good energy that’s clearly dedicated to helping solve the problem, and I want to get behind it and push it and promote it and even perhaps add a few more dollars.

But I’d like to look at some means of providing a stronger influence as opposed to pure competition.

MR. ATKINSON (Cornell University): I really agree with this. At the same time, I am also convinced by Paul Kobulnicky that there is value in the rhetoric of the consumers. This idea of being good shoppers assumes there are some relationships in place that will stay in place and the cultural changes that we are facing are so significant that the idea of really describing a totally new paradigm is probably not a wise approach tactically. Yet emphasizing it—putting it within the context of the consumerism and talking about competition—we have a better chance of moving it forward.

But as SPARC continues it is really important that the longer view is understood and what is put in place is something that will convince people there are alternatives instead of just moving in and competing with the old way of moving the information around. While on the one hand the idea of creating something that is competitive makes sense, on the other hand, I hope you are careful not to see that as an end itself but see it as a springboard to a new paradigm.

MR. NEAL: In that spirit, I heard here and I have heard on my campus a significant amount of interest in exporting the Los Alamos model and to begin to look more aggressively at what possibilities there might be under the umbrella of SPARC to create some pilot institutional or pilot discipline sites to test some new approaches to capturing and distributing access to the research papers.

So the question we raised in the SPARC working group meeting the other day was whether we viewed that type of strategy under the umbrella of SPARC.

UNIDENTIFIED: Yes, Los Alamos, but with an archive.

MR. NEAL: Yes.

UNIDENTIFIED: I think Harold Billings’ point about the incentives is important. I wonder if SPARC should consider some kind of informal way of inviting some of the titles—not necessarily the titles we are targeting—to give their advice on what kinds of incentives would make a difference.

MR KOBULNICKY: Along those lines, the piece of information that was passed on this morning that I found most valuable was Peter Givler’s comment that at the Pew Roundtable the faculty voice was not very evident. SPARC has been talking about a high-level advisory committee since its inception.

It might be important for us to move that up on our agenda so we can begin to get that advice and to gain a voice that would not only help us guide our direction but also help with the communications vehicles that we develop.

I’m constantly struck by the fact that when we talk about the movement forward in academic cultures it is very seldom the members of the academic cultures, but rather those of us on the peripheral, whether it is library issues or other areas, who are causing the movement.

MS. MICHALAK: One thing the SPARC working group wanted to distribute to each of our campuses was a list of editors of the key journals. I have not had a chance to start making calls on those editors, but I intend to call individually on all 20 of those editors who reside near the University of Utah.

As ARL member representatives get out and call on those leading editors on our campuses, if information could be sent to Mary Case about that process and what you learn from those editors, it would be a tremendous help. I don’t intend to try to persuade them to move the journals. I want to learn more about what they see as the climate for consolidation from their point of view.

MS. WERNER (University of California at Los Angeles): We’re about to embark on a project that I’m hopeful will be successful. If so, I’d be happy to share the results. We’ve been asked to prepare a list of editors of about 2,000 or 2,500 high-priced journals for all the universities in California. Our initial idea was to assemble these people on the UCLA campus—the ones that live near UCLA—and talk to them about the Pew report.

Obviously there’s overlap with SPARC and, having heard our discussions in the last few days, I won’t want to do that. We’ve been asked to kind of prepare a lot of materials for focus group sessions with these people that, if successful, can be exported to the rest of the UC campuses, and I’d be happy to share that with the rest of you.

MR. BRANIN (State University of New York at Stony Brook): We should remember that we do have a lot of control. I think we have more than influence. As collection managers, we have a good deal of control over our collections. We have to be aggressive on campuses; being smart consumers we can look at some studies that have been done in physics and in mathematics about the cost and the per-character impact factor.

I think we should start canceling, more aggressively, some of these journals that don’t measure up. We need to take control, and I think we can influence the publishing field very directly by our budgets.

MS. CRIST: Of course. Any other comments? Yes.

MR. ATKINSON: You can make a distinction between rhetoric and real purpose. That, of course, is important. I would only add to be equally clear about the difference between rhetoric and purpose among the publishing partners with whom SPARC works.

I don’t know if it’s true now, but it was certainly true and emphatically clear in February, when Bob Bovenschulte made his presentation to the SPARC group. He said that what motivated him was the wish to take the literature in chemistry back into ACS. He was very clear and very specific that what motivated him was the competitive idea. If our real purpose is not competing but is rather developing new paradigms, then we have to make sure that our partners share that purpose.

MR. FRAZIER: In order to do the business of the Association, we have to move on to other things, but I thank you all for your discussion and we will get this organized and share the results with you.

MR. NEAL: Thank you, Ken. I really would like to applaud the extraordinary work. It is not typical in our field to move a concept from the idea that we have to do something to a $380,000 budget moving forward. Congratulations.

Report on the Concept of a Research Libraries Purchasing and Negotiating Center

MR. NEAL: I want to move now to the discussion of the concept of a research libraries purchasing and negotiating center. I thought I would provide a brief introduction to facilitate the discussion.

Why is this issue being raised? First, members have been raising questions for several years now about whether we as a community can more productively negotiate terms and prices given our market power and our influence.

Second, it comes from an idea captured in the Pew Roundtable recommendation under the mantra of the smart shopper.

Third, members are reporting that their campus administrations are periodically raising the question as to why the ARL and the research library community are not more aggressively exercising their market influence and power.

So the Board decided to launch a conversation and a very preliminary concept paper was drafted and distributed to you (See Appendix II). At this meeting the various association committees and the Board have been debating the merits of the idea and considering what the next steps might be: Whether ARL should proceed to organize an outline of feasibility investigation or not.

Given the time constraints this morning, allow me to outline the feedback that we have received from the several committees that have talked about this issue. On the con side, individuals are saying this won’t work for many libraries because of state regulations on the nature and outlets for purchasing. Also, many consortia obviously are in place that are working very effectively and accomplishing this goal for many libraries.

There are political problems, as well, when research libraries withdraw and undermine local regional licensing arrangements that are in place. This would perhaps change the character and nature of ARL in inappropriate ways.

Further, the issue of negotiations would clearly have to factor in the Canadian members and reflect the important currency differences that would be part of any such negotiations.

On the pro side, individuals are saying things like: This could enable ARL members to influence new product development and the improvement of current products. It would enable ARL members to exercise their market clout. We have a large percentage of the market in many publishing and product areas.

Some members do not realize significant consortia benefits currently and could benefit from such an ARL arrangement. If it weren’t a mandatory program, it would offer ARL members another option for purchasing information and products.

We have heard many perspectives: This would be a great idea for electronic resource licensing but not for equipment and supplies. This would be a great idea for equipment and supplies but not for electronic resource licensing. It would be a great idea for dealing with licensing terms collaboratively but maybe not for price negotiation. As you can see, there is a range of responses to this idea. I would describe the sense of the Association membership at this point as one of skepticism, but with a heavy dose of "what if?"

Three options have been advanced for our consideration: One, conclude that this is not a viable idea and set it aside; two, speculate that this is not a viable idea but organize a feasibility study to demonstrate that; three, speculate that this is an idea with potential and organize a feasibility study to see if it would present a significant comparative advantage over the current methodologies for purchasing negotiations that are currently in place.

That in summary represents what I am hearing as a result of the discussions that have taken place here both in the formal meeting settings and in the hallway conversations about this idea.

I think the Board is looking for direction as to which of these strategies we should be moving forward with. So I open it up for your comments, your questions, and advice. Emily.

MS. MOBLEY (Purdue University): I’m a skeptic, but I think it has to go through a feasibility level.

I think a key area is the whole area of licensing, copyright, and rights management. Some of the other stuff in the concept paper is questionable. When you do the feasibility test, I would like to see you replace the term "cost savings" with the term "cost avoidance."

It’s not clear to me that you still have five percent savings after you pay for the cost of having the operation to do the business. And we’re not a book store. We’re not a warehousing operation.

So I think those are some key points in looking at the feasibility of such a service.

MR. NEAL: I think the issue of the cost of doing this type of business, the overhead elements, clearly need to be incorporated to any feasibility analysis. Ross.

MR. ATKINSON: I’d just to like to make a few points in favor of this. We’ve reached a time when it is more feasible than before. We are starting to save money through cooperative efforts. I have been doing this for 20 years, and I think last year was the first time we saved more money than we spent on travel going to consortia meetings.

Secondly, this has never been tried before. I’ve been assuming that it couldn’t be done because it was illegal. But if there are some legal actions we can take, I think for no other reasons than that we should give consideration into looking at it.

Third, while it’s important to talk about doing this for economic reasons, we need to look beyond that as well. We are constantly running into this difficulty, where on the one hand we need to cooperate with each other and on the other hand of being involved in a supply that demands constant competition.

Having something like this would provide us with the ability to cooperate more effectively, to define best practices, to define core services on the basis of these economic savings. For that reason also this would be something worth looking into.

MR. BOSSEAU (University of Miami): I have one specific reason for supporting the pursuit of this: We are members of more and more consortia, each one specializing in some kind of discount arrangement. And more and more often I realize that these other consortia set priorities on the basis of institutions that have different sets of ideas of what the consortia stand for.

Quite often we are trying to fit in with a piece of action in one consortia and a piece of action with another. Whereas with ARL I think we are on the same level and operate the same way.

MR. KOBULNICKY: Whether it’s SPARC or whether it’s the consortial buying arrangement, I am struck by one relentless thought—if we’re to make substantial progress it really depends on our willingness, but even more on our ability to say no. When you go to buy anything, and you’re looking for the deal that you really need, you need to be able to walk out, to turn your back and walk away.

This gets back to who owns the problem and our ability to actually manage that. Now, I think there are merits in looking at the consortial buying activity largely because of Don Bosseau’s point that we are a coherent buying group and we represent a particular point of view.

But if we are going to take Emily Mobley’s point and be able to realize savings that are beyond that which are necessary to manage the enterprise, whether it’s price or whether it’s terms and conditions of licenses, we need to have the understanding that we will say no, and that we have the backing of our local faculty to say no. If we can do that, we can be effective.

MS. NUTTER (North Carolina State University): Because I represent a state institution, I recognize there are many limitations on how this could work for us and also, if you look at the examples, the economies of scale, for what is really working and what is not in a large organization.

I also think that many of our consortia are programically based and it is very important that we stay a part of those. I would suggest a capability study to look at the collaborative approach that brings in all the consortia and the possible communities of interest—which may include community colleges or public libraries—because it’s very difficult the way we have been doing it.

We are all involved in statewide issues of collaboration. If we don’t have a large enough number of parties participating this will not be financially viable. Also, it would not be competitive then with some of these other organizations.

The second thing I’d like to assert is that this service not be membership-based; we should make this a consecutively-based project where a percentage of the savings would go to manage this so there will always be the competitiveness to make this work and to ensure that it doesn’t become a bureaucratic, costly organization. I think it could quickly become that.

MS. PRESSER (University of Manitoba): You have heard how we Canadians are very concerned about this because—and I won’t talk about the exchange rate of the Canadian dollar and how it really kills us to stay members of ARL—but we think it’s important. That’s also why we throw our money on the table for SPARC.

I have to admit, I am in Emily’s camp: I’m a skeptic in this. After spending I don’t know how many years in the Canadian group trying to get some commonality and a national approach to things, it fell down and it did so because there were so many political jurisdictions and each of us belonged to at least five consortia, and we knew that pulling out of any one of them, because we are so large, would kill those consortia.

So, on one hand I’m a big skeptic and say I am prepared to walk away from this because I can see more things we need to spend our money on. No one talked about where the money will come from for the feasibility study, and I’m sure I wouldn’t want to see my membership money going into this.

On the other hand, I would like to see the feasibility study if only to reiterate the fact that this isn’t the way to go. The fact that it came up at the Pew Roundtable discussion indicates perhaps that we are not doing a good enough job in our own jurisdictions in demonstrating that we are in fact smart shoppers and we have been for 20 years.

So, I guess if it came to a vote I would have to say no; I’m too big a skeptic and I have other things to worry about. Thank you.

MR. NEAL: Thanks.

UNIDENTIFIED: One of my basic concerns is the idea of one shoe fits all. We are not a large group, yet we are not all alike. I think sometimes the one shoe fits all concept may cause some of us who may have a competitive advantage to lose that advantage.

This goes back to an earlier point on the costs of the database. When you get a single model the price might be absolutely ideal for Purdue but not for Connecticut. For instance, the current Lexis/Nexis pricing of $1.82 per FTE may sound fantastic to Connecticut. But for me it’s terrible, because I’m not going to have 36,000 people using it. I would rather be able to cut a deal for $4 a user for 10,000 users, which is less money.

So I think we have to watch out that we not tie ourselves into one shoe fits all models.

MR. NEAL: That’s a very important point. I’d like to cite a conversation we had several weeks ago with representatives of the American Chemical Society talking with them about their web products.

We brought together Trisha Davis from Ohio State University library and Karen Hersey, the University Counsel at MIT, and we engaged them in a sort of prototype discussion on how this type of thing might go.

We put on the table four basic principles that we thought were relevant and important to the entire research library community; at that point we did not bring to the table the issue of price, although it would be a very important one.

But we did bring to the table the issue of archiving. They had not dealt with fair use within the ACS licensing agreement, particularly as it affected long-term activities. Pricing was based on the current print journal subscriptions at the university (not just in the library but in the university) and the number of sites and terminals rather than based on the broader appropriate uses across the university.

We started with the basic principle that said all members of the academic community—wherever they are—should have access and be able to conduct appropriate research and educational uses of the database. The discussion was very productive and achieved significant results in terms of moving ACS from the position where we found them to more openness and support of the types of terms that are relevant to the entire academic and research community.

Obviously, that’s not enough. Price needs to be a part of that discussion. But it was significant in that the academic research library community applied ARL’s influence to change thinking about how the research license should be written and applied. Other comments?

MS. ALEXANDER (University of Missouri): Jim, I was wondering if you could talk about the feasibility study. As I think about this, I think the validity of the feasibility study will be critical as to whether or not we proceed. The focus of the study will obviously need to take into account what the impact would be on the members if they went into the consortia.

So I wonder if you could give more information about how it would be conducted.

MR. NEAL: No, I cannot. I believe the issue is not proceeding with the feasibility study. To me the issue is moving forward to construct a feasibility study to really outline what it is we will be looking at and what the methodologies and the data collection aspects should be. But I think we’re not ready to move forward with the feasibility study.

UNIDENTIFIED: Then would it be appropriate for an outcome of this meeting to have a vote on whether or not to proceed with the construction of a forum and to have a proposal about the feasibility study come to us in October in Washington?

MR. NEAL: I think that that would be an appropriate next step—to construct what a feasibility study might look like and what it would accomplish and then on the basis of that discussion to take the next step to actually conduct a study.

I’m concerned about a vote, because of the numbers of the individuals who are not here. However I welcome an expression—is there a sufficient number of people interested in taking the next step, that is, to construct an outline of what the feasibility study might look like? (applause) Is there absolute opposition to taking the next step and saying this was an interesting discussion but let’s set it aside? There are a few people. We will take this sense to the Board.

MS. GATE: Cheryl Gate, Washington University. One last question. There seem to be a number of foundations and organizations that are very interested in looking at how we might be more cost effective; is it possible that one or more of those organizations might help fund such a feasibility study if we should decide to move forward?

MR. NEAL: Yes. I think there is definitely potential among several foundations for assisting with this type of feasibility investigation. We would begin to have such conversations with those foundations as a result of the Board agreeing to move forward.

Any other questions or comments on this? Thank you. I’d like to turn now to Duane Webster to provide the Executive Director’s report and give us an update on the financial side of the organization.

Report of the Executive Director

MR. WEBSTER: ARL is very much an agenda-driven organization, and in order to necessarily limit the number of issues we work on, we have an annual identification of priorities. They are developed by the Board of Directors, and are presented in the front of the ARL Program Plan.

The Program Plan is the road map that we use to guide our activities during the course of the year. It is also a reference tool for you to look at if you have a question about any of the activities in which the Association is currently involved.

We do, of course, also provide updates and current information on our progress on the priorities in the newsletter, the monthly E-news, and, increasingly, our web page http://www.arl.org, which is updated weekly. I might also say that a very important part of our statement of priorities is the fact that we’re pursuing these priorities in conjunction with a variety of other organizations.

I think you have seen during the course of the week the importance of our partnership with the Shared Legal Capability, the importance of ARL involvement in the Digital Future Coalition, the very long-term carefully developed relationship with AAU, and with Educom, CAUSE, the AAUP, and ACLS.

These partnerships are crucial to our success in advancing research library interest in these areas. I want to draw your attention to these partnerships in part because most of those partnerships are experiencing a change in leadership currently and thus the nature of our future relationship with these partners is one that deserves study and effort on our part.

Educom and CAUSE are merging into EDUCAUSE, with Brian Hawkins as the new president. We have made a particular effort to get John D’Arms, the new president of ACLS, here to this meeting in order to work with us and for him to learn more about ARL and for you to meet him. The same sort of circumstances is true for Peter Givler, AAUP’s new president.

A new president of AAU is also coming into play. As you know, Cornelius Pings is retiring and Nils Hasselmo, formerly chancellor at Minnesota, will be assuming the AAU presidency. We do have Nils scheduled to come meet with us at the July board meeting, and we would expect that there will be occasions in future ARL meetings to have him come join us.

Let me go on to the first chart on the ARL finances (Figure 1), a summary statement based on the 1997 audit that was presented to and accepted by the Board at their meeting earlier this week. The 1997 audit will also be available to you as part of the proceedings from this meeting (see Appendix III). This summary is to assure you that Jim’s comment about the sound financial condition of the Association is quite accurate.

Figure 1

The revenue for the general operating fund was 2.3 million in this last year, with expenditures somewhat less. An improvement in the general operating fund balance brought that figure to $286,300. That is as close to characterizing our surplus as is possible—that is the bottom-line number. But it’s not the complete picture, because we look at the Office of Leadership and Management Services as an entity that has both a dues base and a cost recovery sales base. Their revenue was $626,000, expenses $571,000, giving them a surplus of $55,000. This surplus was applied to a negative fund balance that has been existent for the OLMS for the last five years, reducing it to minus $28,000.

So what you then need to do is combine the fund balance from the general operating fund and the fund balance from the OLMS and you see that we had a net improvement of unrestricted assets of $64,000, bringing the unrestricted assets to $258,000, which is somewhat less than the fund balance for the general operating fund.

This next chart looks at where our revenue is coming from (Figure 2). This chart over the last ten years demonstrates, first, that the dues base, the core for our finances, and the base on which we operate, is roughly 60 percent of our revenue.

Figure 2

Cost recovery is included with the dues in the middle line of the chart. Cost recovery has extended and enhanced our dues base to allow us to do more with the investment that you’re making in the Association.

I might note that in 1995 the ARL Board encouraged us to stabilize the cost recovery growth so that we wouldn’t become too focused on that part of our effort to generate revenue. Since that point we have in fact stabilized cost recovery. The top line, then, includes restricted funds—which are always very cyclical—into the revenue sources. We are able to attract a few small grants from year to year to help us execute particular projects, but it’s not an element that we rely on extensively.

The next chart indicates the distribution of revenue from our different sources (Figure 3). Last year, the dues, which is the basis on which we operate, was 60 percent, publications is a significant portion (10%), training and conferences is a significant portion (12%), and then the rest of the elements are relatively minor, although, I would note that we’ve been fortunate to have a paying relationship with the Coalition for Networked Information that provided us support in the administrative arena.

Figure 3

Let me close by saying that so much of this activity is reflective of the very talented, hard working, and energetic staff that we’ve been fortunate to attract to ARL over the last several years. Would you join me in saluting the ARL staff for that effort and for the great talent?

(applause)

They are a joy to work with. Let me just mention some changes that are underway. Jaia Barrett will be taking a two-year leave to accompany her husband to lovely Kiev in Ukraine. Jaia has agreed—and I think it is a very important experiment on our part—to continue to work on a part-time basis to edit and produce the ARL newsletter. We’re hoping in that way to keep her enmeshed in the issues of the Association during the two years so that when she returns she’ll be running at full speed.

In the meantime, we’ve been very fortunate to attract Lee Anne George to ARL. Lee Anne is coming to us from Harvard College, where she was the librarian for information services and document delivery services. Her title with us will be ARL Program Planning Officer.

I also wanted to note there will be a change in the Office of Leadership and Management Services. We have been fortunate to recruit Trish Rosseel as Visiting Program Officer, to join the OLMS in August. Trish comes from Vancouver, Canada, where she has been working on a series of distance learning initiatives.

I think Ken Frazier also mentioned that we are moving to negotiate a contract for a SPARC enterprise director, and we expect to complete those negotiations within the next two weeks.

With the addition of Trish we will be fully staffed. I am very pleased with the way that the new category of folks has turned out. As you can see from Cliff Lynch’s leadership in the Coalition for Networked Information, his addition to the CNI has made a significant difference in assuring us the continuing growth and vitality of that organization. He is working very closely, regularly with us in the issues that we’re facing.

Finally, let me just say thank you for the acknowledgement of my ten years of service as ARL’s executive director. It was a bit of a surprise. But I appreciate the warm response and the celebration.

MR. BENNETT (Yale University): I wonder if I could ask you to put back on the chart showing sources of revenue (Figure 2)?

I understood Duane to say that the cost recovery line is money that leverages our ability to act on the basic mission of the Association, and I think that’s true. So I like seeing that line. I understood Duane also to say that the leveling off of that line in 1995 is evidence that we have achieved balance such that the cost recovery activities will not take over the identity of the Association.

I’d like to suggest that where that line falls doesn’t provide any evidence of that. If that lines goes way up and it’s still leveraging the mission of the Association, we have every reason to applaud that.

I think we need to take the first item of advice of the Pew Roundtable: Let’s not be transfixed by these numbers; let’s instead deal with the question of whether our cost recovery activities are biasing our values. As long as that is not happening, I suggest that we should do everything we can to aggressively drive that line up, because it’s all about leveraging.

MR. NEAL: I’d like to thank George Shipman and the University of Oregon staff for hosting us. It was a very good meeting, and we had a good time both here and at the University of Oregon campus last night. Thank you very much.

(applause)