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Market overview
Growth slows, but new
for most leading suppliers. Companies
such as Elsevier, Springer and Wiley are all
establishing strong e-book programmes and
technology holds promise
are expecting good growth from their e-book
publishing activities in the next two years.
Workfl ow and content management
solutions, and added-value features such as
Annual growth in the European STM information market
data mining and analytics tools are increasingly
has dropped to 4.6 per cent. Market analyst David Mort
being developed by leading providers to gain
a competitive edge. By moving into these
looks at some of the trends over the past year
sectors, traditional STM publishers are
coming into competition with new players,
For many years, the scientifi c, technical and with an operating profi t margin of almost 32 primarily technology-based companies with
medical (STM) information market has per cent in 2007, followed by Informa with no traditional publishing experience.
been seen as a safe haven for investors: most an operating profi t margin of 31 per cent for With growing concerns over weaker sales
companies in this market have achieved its STM business. And profi t margins for in the maturing markets of North America
healthy annual increases in sales and most of the leading players have remained and the European Union, suppliers are
profi ts, and investors have been attracted to at high double-digit levels since 2002. increasingly targeting the Asia Pacifi c
this sector at a time when returns in other In a separate exercise, IRN tracks the market. Thomson Reuters, for example,
information markets have been more erratic. sales and pre-tax profi ts of around 50 UK is focusing on developing more specialist
The continued growth in research funding information and content companies. In localised STM content for the Asia Pacifi c
and scientifi c research output are overall 2007, the UK STM information suppliers in market.
trends that will have a positive impact on this group produced an average sales increase Mergers and acquisitions in the European
the market. However, the emergence of of 6.8 per cent and saw their average pre-tax STM sector have been limited over the last
new publishing models, the spread of Web profi t margin increase to 4.6 per cent from year and fewer deals have been completed
2.0 applications in the scientifi c community 3.9 per cent in 2006. compared with the previous two years.
and information budget weaknesses in Some of the major deals impacting on
some market segments could start to have a Trends and issues the European STM sector have been
stronger negative infl uence on information In the STM information market, online essentially USA-based – Thomson buying
company margins. So, are there any signs sales now take an estimated 66 per cent of Prous Science and Proquest’s purchase
from the recent market trends data and all sales compared to less than 50 per cent of Dialog, for example. There has been
corporate fi nancials that suggest an STM in 2003. more emphasis on purchases of individual
information market downturn? Feedback from key suppliers suggests titles and specialist publications, and
In 2007, sales in the European scientifi c, some common themes and issues. Firstly, partnerships with software and technology
technical and medical (STM) information healthcare continues to be the main companies rather than big deals. However,
segment increased by 4.6 per cent to reach driver of sales with clinical decision the current interest in Informa from a
€2.2bn. Measured by revenue growth, support solutions, particularly those at the number of venture-capital companies
2007 was a modest year for the larger STM point of care, leading sales growth. For suggests that another major deal may not
providers. Some, such as Springer, Thomson example, Informa, Thomson, and Wolters be far away.
Healthcare, and Informa, still posted double- Kluwer all reported strong sales in their
digit sales growth. However, this was often the clinical solutions services. In contrast, User perspective
result of acquired businesses being added to pharmaceutical information sales have At the time of writing this article, IRN
the revenue total. Organic growth for many of generally struggled. For example, Elsevier, is halfway through a survey of STM
the leading players was considerably lower at Springer and Wolters Kluwer all highlight information users and has preliminary
around 4 per cent (Elsevier, Springer) or just weaker sales in this sector. fi ndings from academic users. In the
1 per cent in the case of Wolters Kluwer. Suppliers also note that the development academic sector, most libraries and
However, while sales growth may of e-book packages for institutional users information centres are reporting year-on-
have dipped in the latest fi nancial year, has fi nally become a mainstream activity year budget increases at least in line with
profi t margins for the leading players are
strong, continuing a trend which began in Table 1: European STM Information Market (€ million at current prices and
2001/2002. Over the last fi ve or six years, percentage growth), 2005–2007
most of the leading STM information
2005 2006 2007
players in Europe have been able to post
year-on-year double-digit profi t growth for
STM Information Market 1,968 2,111 2,208
most of the time. % change year-on-year +5.0 +7.2 +4.6
In terms of profi t, Elsevier leads the way
Source: IRN Research
www.researchinformation.info Research Information December 2008/January 2009 27
RIdec08 pp26-29 Market.indd 27 17/11/08 16:56:11
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