Information Retrieval Services
SIC 7375
NAICS 518111
Information retrieval services supply textual, numeric, and graphic data, usually in the form of searchable databases, to their customers electronically via CD-ROM and online services. Internet-only access services are discussed separately under the title Internet Services, and firms that provide other services related to information technology are covered under Information Technology Services.
Information retrieval services make information easier to access, understand, and use. They allow individuals, with the press of a few keys on a keyboard or the click of a mouse, for example, to quickly explore archives of material that might otherwise take hours or days to search and locate using traditional cataloging systems. Furthermore, information services permit people and organizations to provide and access remote data, update information regularly, efficiently communicate and complete transactions with customers and service providers throughout the world, and reduce consumption of paper, among other benefits.
Commercial information retrieval services emerged in the 1970s and were barely recognized as an industry by the early 1980s. During the mid-1980s, though, the segment realized explosive growth. This growth was the result of technological advances related to personal computers, computer networks, modems, and improved data storage devices. However, due to the growth of the Internet in the mid-1990s, the information retrieval industry experienced a number of changes. News and newspaper and periodical web sites drove a number of small information retrieval services such as NewsNet out of business by the late 1990s. In addition, information retrieval services began to consolidate and change corporate owners. Leading services including Lexis-Nexis and Dialog were sold during this period. Nonetheless, by the mid-2000s demand remained strong and the outlook was positive for information retrieval services with large aggregated databases and strong name recognition such as Dow Jones News/Retrieval and Lexis-Nexis; expanding markets also exist for services that target specific information niches.
By the mid-2000s, the information retrieval industry continued to face the prospect of further consolidation. In addition, industry players competed in an environment characterized by leaner library budgets. However, information providers benefited from the fact that libraries were purchasing greater shares of electronic versus print content.
One trend heading into the second half of the 2000s was the convergence of databases, in that information seekers desired one simple point of access for searching. This was evident in the increased use of federated or meta-searching, in which technology allowed users to search across multiple databases at once for information. In addition, there were signs that popular Internet search engines such as Google would converge with premium databases in some form.
Most information providers were also expanding on their abilities to provide users with data in real time. This was being demanded more, particularly by corporate users. The financial industry, including online brokerages, were also providing an increasing amount of real time data to their clients.
The information retrieval industry encompasses a diverse mosaic of organizations offering a plethora of services. That extreme diversity stems from the fact that the industry, just beginning to mature in the 2000s, is influenced by rapid changes in technology, ease of entry, and an almost infinite array of unfilled market niches. Companies or individuals that can figure out how to fill or create a need in the market using existing technology can profit, often with only a minor capital investment. Creativity, knowledge of a market need, and technological expertise are the greatest limitations. Thus, industry participants range from large online services with millions of customers to individual entrepreneurs who compile and sell information to a small base of customers. Despite this diversity, a handful of large online service providers garner the bulk of industry revenues.
Most information service offerings can be categorized as either business/research or personal. Business/research information retrieval services primarily offer numeric and bibliographic data concerning both technical and topical information. Most companies in this segment compile data from primary sources and reconfigure it for electronic accessibility. Firms that generate proprietary data, such as mutual fund performance or electronic training manuals, are usually classified in their respective industries. Companies may offer abstracts and text from periodicals, books, and journals, or financial and trade data, press releases, news updates, and historical company/industry information. Some companies simply obtain unwieldy, publicly available government data and repackage it into an easily accessible, understandable electronic format.
The largest business/research segments are legal and investment data. Marketing, scientific, and library information services also comprise a large portion of this market. The remainder of the sector serves a variety of niche markets. For instance, services can be tailored specifically to one industry or profession, such as chemical, healthcare, civil engineering, agricultural, banking, insurance, or food service. In addition, many niche services are managed by nonprofit organizations. Major players on the business side of the industry 2005 included North American firms Thomson, Dun ↦ Bradstreet, Bloomberg L.P., ProQuest and Dow Jones. Major players outside of North America included Reuters (United Kingdom), Wolters Kluwer (Netherlands), and Deutsche Presse-Agentur (Germany).
Like business/research information offerings, electronic information services targeting the consumer market may provide current news and financial information. In addition, they typically offer features such as electronic shopping, recreational bulletin boards and other interpersonal communication domains, weather and sports data, encyclopedias, games, travel information, home and garden advice, and thousands of other offerings. In comparison to business information services, most personal systems are inexpensive, primarily because of the number of users in the market. For instance, many consumer-oriented online services allow subscribers unlimited access for less than US$20 per month. In contrast, the effective rate for many business-oriented information databases can exceed several thousand dollars per month.
Market emphasis is reflected by the number of databases offered for each segment. The 2002 edition of the Gale Directory of Databases, which provides a listing of 14,250 databases from around the world, showed that in 2001 some 3,075, or 24 percent, were targeted at business consumers. Some 2,340, or 18 percent, were categorized in the science/technology/engineering sector, which was followed by general information databases at 1,578, or 12 percent. Following general databases, in descending order, were law, health/life sciences, humanities, social sciences, multidisciplinary academic, and finally news. In 2002 Gale alone maintained more than 600 databases, according to the company corporate web site.
The primary means of delivering electronic information services are online systems and CD-ROM. Other media include magnetic diskette, magnetic tape, and audiotext. Consumers access online systems with a modem, a device that allows a computer to send and receive information. Customers usually access a central data bank of information by calling a local telephone number. In addition to the central data bank, most online service providers also supply access to other services and data sources, including communications networks (e.g., bulletin boards where users can communicate with each other). The service provider may charge the customer a flat monthly rate for unlimited access or for the length of time they use the database, the amount of information that they access and print, or the type of information they use. Lexis-Nexis in the 2000s began offering a service to the general public that enabled a potential customer to purchase a single article on demand for a small fee.
One advantage that online systems have is that the medium is especially appropriate for consumers who require up-to-the-minute information. Database managers can continually update information related to stock quotes and other financial data, legal rulings and court proceedings, sporting events, world news, and other variable subjects. Online systems are also advantageous because they allow access to massive amounts of information that would be difficult or impossible for customers to maintain in-house. In fact, the most popular online services offer a conglomeration of individual databases, communication services, and products that can be searched simultaneously. The disadvantage of online services in the late 1990s through 2000s was high cost. Expenses related to collecting timely information, accessing phone lines, and supporting sophisticated data storage and networking equipment can require immense overhead. Customers who access large amounts of tax and legal information, for example, may pay as much as tens of thousands of...
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